CHINA: China South, AF-KLM cargo JV on hold

China Southern Airlines and Air France-KLM have postponed their cargo joint venture, according to China Southern chairman Si Xianmin. “Based on the original plan, our cargo JV with AF-KLM should have been launched in the first quarter. But we have to reconsider this plan after taking the current marketsituation into account,” Si said. China Southern […]


China Southern Airlines and Air France-KLM have postponed their cargo joint venture, according to China Southern chairman Si Xianmin. “Based on the original plan, our cargo JV with AF-KLM should have been launched in the first quarter. But we have to reconsider this plan after taking the current marketsituation into account,” Si said.

China Southern signed a framework agreement with AF-KLM in the middle of last year to launch a cargo joint venture in which the Guangzhou-based carrier would hold a 75 per cent stake. AE Cargo (Asia-Europe Cargo) was to develop a 10-aircraft fleet over the next two years with a hub based in either Guangzhou or Shenzhen.

The new cargo airline would have taken delivery of four 777 freighters and one converted A300 by now, but has decided to push back two of the 777s until year end and the remaining aircraft to 2010. The two partners gave no indication of when the JV will get off the ground.