China airline to seek listing
China Northwest Airlines, one of the mainland's Big Six carriers, is seeking foreign investment to help it stem its losses and plans to float its shares on a foreign stock market in three years.
The carrier, notorious for its history of accidents, has vowed to improve its safety record, upgrade its outdated fleet, and increase efficiency.
Airline president Nie Shengli declined to give any loss figures but said he would turn the carrier around in two years.
The airline has been losing money for a number of years.
'We will restructure the airline into a shareholding company to accept Chinese and foreign shareholders first before we seek an overseas listing in 1998 or 1999,' Mr Nie said.
He said the airline talked to several foreign investors late last year about possible investment.
The Civil Aviation Administration of China (CAAC) and the State Commission for Restructuring the Economic System were helping the state-owned airline restructure and transform into a shareholding company, he said.
On Tuesday the CAAC said foreign investors would be encouraged to invest in Northwest Airlines and other eligible Chinese airlines.
CAAC's move has been hailed by analysts as significant because Beijing has always considered airlines a sensitive industry and largely prohibited foreign investment.
China Northwest Airlines is to take delivery of 10 Airbus 320-300 aircraft from next year, part of a US$2 billion order for 30 Airbus aircraft placed by Premier Li Peng during his trip to France in April.
The aircraft will replace Russian-made Tupolev-154s.
Mr Nie, formerly president of Xinjiang Airlines, was put in charge of the much bigger China Northwest Airlines about two years ago after the latter suffered a spate of air disasters in the 1980s due to poor management.
China Northwest Airlines, together with Air China, Southern, Eastern, Southwest, and Northern airlines, are the Big Six carriers, accounting for 76 per cent of the domestic available seat kilometres and 74 per cent of the flight frequencies.
Based in Xian, Shaanxi Province, it operates about 100 domestic routes and four foreign routes to two Japanese cities and Hong Kong and Macau.
