American Airlines has committed to make a $200m equity investment in China Southern Airlines, creating what it calls “a strong foundation for a long-term relationship between two of the world’s biggest carriers”. The U.S. carrier, one of the founding members of the oneworld alliance, will hold a 2.68% stake in the Chinese airline, which is a member of SkyTeam.
The two carriers underline the complementary nature of their respective networks. China Southern’s primary hub is located in Guangzhou with the majority of its transpacific flights positioned there, while American flies to Beijing and Shanghai from its hubs in Chicago, Dallas Fort Worth and Los Angeles. Later this year, the two carriers expect to begin codeshare and interline agreements that will give customers access to many more destinations in China, as well as North and South America. American customers will be able to access nearly 40 destinations beyond Beijing and more than 30 destinations beyond Shanghai. China Southern customers will gain access to almost 80 destinations beyond LAX, San Francisco and New York’s Kennedy Airport in North and South America.
The expected codeshare routes are anticipated to include the ability to earn and redeem AAdvantage Miles, through-bag checking and the ability to book travel on a single ticket. The planned routes operating under the interline agreement are anticipated to include through-bag checking to the traveler’s final destination.
The deal cements a third link between U.S. and Chinese major carriers. Delta acquired a 3.55% stake in China Eastern in 2015, while United Airlines has a multi-year strategic partnership with Air China.