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Business

China Southern Airlines seeking pact with American

China's top carrier joins industry trend

China Southern Airlines is teaming up with a leading U.S. carrier.

HONG KONG -- China's leading air carrier, China Southern Airlines, announced Monday that it is negotiating a strategic partnership with American Airlines.

The details still need ironing out, but if the deal goes through, one proposal has the U.S. carrier investing $200 million in China Southern by purchasing newly issued shares. The two airlines would deepen their business relationship in the increasingly competitive market.

Based out of Guangzhou, China Southern is the largest of China's big three carriers, with sales in 2015 totaling 111.6 billion yuan ($16.24 billion). It is a member of the SkyTeam global airline alliance, while American Airlines is a member of the Oneworld group.

China's other two leading airlines, Air China and China Eastern Airlines, are already in strategic partnerships.

Hong Kong-based Cathay Pacific Airways bought a portion of Air China in 2006, and the U.S. carrier Delta Air Lines agreed in 2015 to invest $450 million to acquire a 3.5% stake in China Eastern Airlines. Delta and China Eastern are both part of the SkyTeam alliance, and the investment is part of their continuing efforts to deepen their relationship.

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