A move this week by six regional mainland carriers to join forces has been seen as a bid to take on the might of the Civil Aviation Administration of China (CAAC). Under the terms of an agreement unveiled this week, Hainan Airlines, Shandong Airlines, Shenzhen Airlines, Sichuan Airlines, Wuhan Airlines and Zhongyuan Airlines formed the New Star Alliance. The grouping - which will see a sharing of resources, such as employees, aircrafts and check-in counters - will take effect from January 1 next year. Airline industry sources have seen the move as an attempt by the airlines to protect themselves against CAAC plans to force consolidation in the mainland aviation industry through a series of mergers. These plans have been perceived as a threat to the survival of a number of smaller regional carriers, who risk being merged into much larger mainland airlines such as China Southern or China Eastern. A senior figure at one of the airlines - who spoke on condition of anonymity - said the move represented a 'defensive strategy' on the part of some of the airlines to help them avoid any moves by the CAAC to force mergers. Despite this, he did not believe there would be any reason for CAAC to be 'unhappy' with the alliance, although he said it could 'push some major airlines to provide better services'. In one sense, the formation of the alliance was in line with the CAAC's stated policy of hoping to form a smaller number of bigger airlines on the mainland, the executive said. 'These six airlines are independently quite small,' he said. 'This alliance effectively can be the start of a big company.' The sharing of resources would allow them to provide better services, he said. Other sources said the move would allow the smaller airlines a 'buffer zone' against any moves to force them to merge. The political clout of the airlines that makes up the new alliance is believed to vary significantly. While Hainan, Sichuan and Wuhan airlines are seen as being well-connected in Beijing, Shandong, Shenzhen and Zhongyuan airlines are regarded as not having the same political clout and are possible takeover candidates, according to the Air Transport Intelligence news agency. The alliance is seen as giving the smaller three carriers a chance to stay in the air, amid an atmosphere of rationalisation permeating the mainland. The CAAC's plans to rationalise the mainland's aviation industry have been prompted by safety concerns, as the number of domestic carriers grew to more than 30 by the end of last year.
