Hainan Airlines is planning to set up a new airline based in Fuzhou, in southeast China’s Fujian province.
A statement on the Civil Aviation Administration of China’s (CAAC) website revealed last week that Hainan Airlines – China’s fourth largest carrier – has received the permission to create Fuzhou Airlines, in a joint venture with three other companies including a state-run investment firm.
Hainan Airlines will hold a 60% stake in the venture, providing initial capital of CNY1.2 billion (US$197 million) to launch the carrier, out of a total investment of CNY2bn.
According to CAAC, Fuzhou Airlines will be based at Fuzhou’s Changle International Airport and will operate under the full-service model. It will initially operate a fleet of Boeing 737-series aircraft on domestic routes.
The launch of Fuzhou Airlines marks the latest stage in Hainan Airlines’ expansion. Part of the HNA Group, it operates a range of domestic subsidiaries in China, including Chongqing-based West Air, Kunming-based Lucky Air, Tianjin Airlines and Hong Kong Airlines. It also recently announced plans to create Urumqi Airlines, based in the northwest region of Xinjiang.
The new Fuzhou Airlines will challenge China Southern Airlines’ subsidiary, Xiamen Airlines, for dominance at Fuzhou Airport.
HNA Group currently operates more than 400 aircraft on over 570 domestic and international routes, carrying 42m passengers to 190 cities. In 2012, HNA Group handled approximately 13% of the air passenger traffic in China.