Many partnerships have been formed between international carriers and mainland airlines. China Southern Airlines last week started a code-sharing arrangement with KLM Royal Dutch Airlines on cargo services.

Air China, the No2 carrier in China, is tipped to be a candidate for Star Alliance membership.

Not only does it have a long-established relationship with founding partner Lufthansa on China-Europe operations, it also signed an agreement with United Airlines last month to code-share on transatlantic routes.

A top-executive from Lufthansa said earlier that it was a logical step for Air China to join the team. President of the mainland carrier, Li Jiaxiang, said management was deciding whether to join the group - the world's biggest airline team, with a capacity share of 28 per cent.

In the post-September 11 era, alliances not only grouped members for a stretched international network, but joining forces could also help carriers trim costs, Mr Albrecht said. Joint fuel purchases helped its members save at least US$10 million a year, he said.

Four of its members, Air Canada, Austrian Airlines, Lufthansa and Scandinavian Airlines, also joined forces to ask aircraft manufacturers to build regional aircraft with 70 to 100 seats. The collective order, including 100 firm orders and 100 options, would help the carriers save about US$10 million, said Mr Albrecht.

The standardisation of aircraft models will also allow airlines to trim costs on training and inventory.

The alliance is also asking information technology suppliers to build a standardised platform for ticket bookings and reservations for its members, which will also save another several million dollars. However, no timeline has been provided for this.

'Maintaining a global presence while reducing your cost base is the name of the game - and we are successful at playing it,' Mr Albrecht said.