Virgin Atlantic’s US shareholder Delta Air Lines is taking a $450 million minority stake in China Eastern Airlines.
The deal for a 3.55% shareholding strengthens an existing code share partnership between the two carriers.
Delta described the move as a “significant step” in the airlines’ collaboration that will allow them to compete more effectively on routes between the US and China.
China Eastern, with its wholly-owned subsidiary Shanghai Airlines, and Delta currently operates codeshare flights on 30 domestic routes in the US, 43 routes in China and seven trans-Pacific routes.
China Eastern serves the three largest US markets with four non-stop flights from Shanghai and Delta serves the three largest cities in China with six daily non-stop flights from the US.
Vinay Dube, Delta’s senior vice president – Asia-Pacific, said: “Our long-running alliance with Air France–KLM has been quite successful in the transatlantic and our newer alliance with Virgin Atlantic continues to exceed all expectations.
“Looking at Latin America, we have thriving partnerships with GOL and AeroMexico. As we continue to grow our footprint in China, our partnership with China Eastern will be another win for our customers, employees and shareholders.”
Shaoyong Liu, chief excutive of China Eastern, said: “The co-operation of the parties is based on a global vision and joint strategic blueprint.
“The parties will take advantage of their respective route networks, flight services, relevant businesses and advantageous resources to fully connect the world’s two top economies as well as two top air transportation markets.
“The parties wish, through excellent operation and international co-operation, to optimise customer experience, enhance the parties’ global competitiveness and promotes the development and revenue growth of both parties.”
Delta chief executive Richard Anderson said: “Delta’s relationship with China Eastern is long-standing. We share a vision that will create the most profitable, enduring franchise between the US and China, with world-class customer service.
“For the past three years, Delta has welcomed members of the China Eastern team at our headquarters for sharing best practices and work study opportunities. We have learned much from one another already and look forward to deepening our already effective partnership.”