By Wang Zhenghua (China Daily)
Updated: 2007-12-05 09:55

Regional carrier Shanghai Airlines will officially join the Star Alliance group of airlines on December 12 in a solid move to expand its global reach and quickly raise its standard of management and service to international levels, its chairman Zhou Chi said yesterday.

The Shanghai-based player has served as an observer of Star Alliance, one of the largest and most awarded airline alliances in the world, for more than one year, and is expected to become a full member along with the much larger Air China.

Major Chinese airline companies are rushing to join the three global airline alliances in an effort to better participate in international competition, with China Southern Airlines becoming the 11th full member of SkyTeam last month, the first Chinese carrier to join the elite club.

"The matter is of great significance because it will help us become a global, advanced airline company," Zhou said yesterday during a news conference.

"The membership gains us access to the international market and makes us raise our service to an international level."

Joining the alliance will also bring about a fundamental change from destination-to-destination service to a hub airlines player for Shanghai Airlines, gaining an opportunity to generate long-term profit beyond its own ability, he added.

"They choose us and Air China because the alliance views Shanghai and Beijing as hub portals to the Chinese mainland," Zhou said.

Shanghai is one of the three largest aviation centers in China, as all airline companies put a premium on the financial hub in their future development strategies.

China Eastern Airlines takes the leading position in the Shanghai market with 35 percent of the market share, followed by Shanghai Airlines with 18 percent and Air China with 12 percent.

But as its two major rivals China Eastern and Air China have teamed up with foreign strategic partners, the company so far has no plan to team up with either domestic or foreign aviation companies.

"We will definitely invite strategic investors in the future, but before that we will become bigger and stronger," Fan Hongxi, the Shanghai-listed company's president, said.

The company plans to grow its fleet to 100 aircraft in 2010, and has gained approval to open new routes to Seattle in the US and Hamburg in Germany.