Calls have been made for a shake-up in both Taiwan's aviation bureaucracy and in China Airlines' (CAL) management team following a crash in Hong Kong in August.

So far, the carrier's relatively new management team, installed following an Airbus A300 crash at Taipei in February last year, has emerged intact, to the relief of those who say the team is working hard to improve flight safety. The country's top regulators have also kept their jobs - many of them were also replaced only last year.

But CAL's operations are affected. At the end of August, Taiwan's civil aviation authority ordered the airline to cut frequencies on four routes for at least a month and to put its 700 pilots through re-training in the wake of the 22 August crash involving a Boeing MP-11.

While observers say the flight cancellations will have little financial impact as business is traditionally down at this time of year, other sanctions may hurt. Soon after the accident, the CAA said that, as a penalty, CAL would be barred from adding any new services for a year.

CAL has suffered four hull losses since November 1993 and its Hong Kong accident could not have come at a worse time. The airline had just announced a return to profitability in the first half of the year and was forecasting strong profits for the full year - a turnaround following hefty losses last year caused in part by the A300 crash that killed three and injured more than 200.

Home-based rival EVA Airways has been a beneficiary of CAL's woes. EVA has not only stolen passengers, but CAL's airline partners as well. Early in September, EVA announced a sweeping tie-up with American Airlines, due to take effect from 31 October and cover code-sharing on both transpacific and US domestic routes. In May, American severed established links with CAL.

But, despite all the negative news surrounding CAL, the carrier's government-linked owner, the China Aviation Development Foundation (CADF), says sale plans are still on.

CADF holds a 71% stake and intends to cut its shareholding by half by the end of this year, says a senior official.

Source: Airline Business