More Chinese deregulation

The Civil Aviation Administration of China is aiming to fully deregulate domestic air routes by 2010, giving smaller players more opportunity to challenge major airlines. By 2010 airlines will no longer be required to get approval to operate on domestic routes and instead will only have to report their intentions to the regulator. Some parts of China can already be served by domestic airlines on this basis, but strict controls are in place on several high-volume airports including Beijing and Shanghai. Some smaller Chinese carriers have complained that current regulations have prevented them from growing and challenging the bigger airlines in key markets.

ANA strengthens Asiana tie

Japan's All Nippon Airways and South Korea's Asiana Airlines are to strengthen their bilateral ties through more operational links and a cross-shareholding arrangement. The equity ties are symbolic, as each will be buying only $12 million worth of shares in the other, amounting to stakes well below 1%. But the Star Alliance partners have agreed to codeshare on more routes, co-operate at airports, strengthen sales and marketing ties, consider joint purchasing and exchange personnel.

Biman plans job cuts

Bangladesh's caretaker government is looking to convert troubled Biman Bangladesh Airlines into a public limited company in a move that it hopes will help lead to a cut in the size of its workforce. The government says corporatising the ailing carrier will enable it to make decisions with less government interference and, most importantly, cut jobs through a voluntary redundancy scheme.

Sydney backs down on fees

Virgin Blue has convinced Sydney airport to revert to its old method of basing fees on take-off weight rather than number of passengers. Sydney switched to a passenger charge at the suggestion of Qantas, which thought it would disadvantage Virgin Blue. Virgin sued and a court agreed that Sydney had abused its monopoly. Under threat that Virgin would next go to the competition commission, the airport in late May retreated to its old system.

Source: Airline Business