Official: China Southern Leaving SkyTeam

There have been rumors of China Southern leaving SkyTeam and joining oneworld for years. In ways this is logical, as oneworld doesn’t have an airline based in mainland China, while China Southern has second-rate status in SkyTeam, given Delta’s close partnership with China Eastern.

There is, however, the matter of Cathay Pacific. Cathay Pacific has veto power in oneworld, and many think that they wouldn’t want another airline to join that’s based so close to Hong Kong. This has also lead to rumors of Cathay Pacific leaving oneworld and joining Star Alliance, though that seems less likely.

Still, the way this situation has unfolded has been interesting.

In early 2017, American Airlines bought a $200 million stake in Guangzhou-based China Southern Airlines. On some level this was surprising, given that prior to this the two airlines didn’t cooperate in any way. They had no codeshare agreements, and American doesn’t even fly to to Guangzhou. American said that this investment “creates a strong foundation for a long-term relationship between two of the world’s biggest carriers.”

It’s not necessarily uncommon for airlines to have partnership and relationships outside of their main alliances, though SkyTeam has more restrictive rules for their members, and specifically limits the number of codeshare routes that airlines can have with airlines not belonging to the alliance. Earlier this year American and China Southern were forced to nearly halve their codeshared operations due to this restriction.

With all that as background, China Southern just posted the following notice to shareholders and investors, confirming that they will not be renewing their SkyTeam association for 2019:

In ways, this isn’t surprising, as tensions have obviously been building for some time, but this does seem like a fast departure.

At this point transition details are unknown, and there are a lot of factors to consider. Beyond the loyalty arrangements and reciprocal benefits with other SkyTeam members, there are agreements surrounding codeshares, ticketing, interlining, and so forth that will need to be renegotiated (or possibly terminated).

In general, if you have an existing ticket on China Southern for next year this doesn’t change anything about your actual flight, and operations will continue as normal. Depending on the timing of your trip, however, you may not be able to enjoy SkyTeam Elite benefits such as increased baggage allowances, and your options for crediting miles may change.

We’ll update as we know more.

What do you make of China Southern leaving SkyTeam?

(H/T HKTravelBlog)

Comments

  1. as someone who lives in Sydney, with familes in Guangzhou and often go to Japan for work (holds JAL Emerald), this is the best news ever!

  2. As a skyteam flyer the past few years, it doesn’t really affect me since I prefer to fly Korean Air when going to Asia rather than China Southern.
    I do remember China Southern normally has really good award availability on their F class seats so if they do go to oneworld, it’ll be another way to use AAdvantage miles!

  3. Honestly, this has been discsussed for ages and never seemed that it would come to be. So yes, i’m extremely surprised.
    They might choose to stay unaligned and just team up with different airlines. Skyteam still has China Eastern.

    At this point, Cathay could actually move to Star Alliance.

  4. It should not affect (award) tickets issued by Delta for China Southern flights, should it? I have a trip coming up in January on such a ticket.

  5. Personally I can’t see Cathay Pacific leaving oneworld (where they have veto power) to join star alliance (where they’ll be a small fish in a big pond.) Quite frankly, star alliance is saturated with Asian carriers (Thai, Singapore, ANA, Air China, EVA, Asiana, Air India, etc.) and doesn’t need Cathay Pacific. Not sure if star alliance even has veto rights for its founding members but if they do, I highly doubt they’d give it to CX if CX joins the alliance.

  6. @Joey
    If they do, then Thai has veto rights, and I know they’ll want to keep Cathay out.

    And don’t forget about Shenzhen Airlines, a small regional airline that’s closer to Cathay and HKG than China Southern.

  7. Awful airline so SkyTeam will be glad to see the back of them.
    I had the pleasure to be booked on them from Los Angeles to Bangkok via Guangzhou on a delta ticket. The flight was delayed due to an engine issue and I missed my connection. They refused to rebook me claiming as it was not their ticket it was not their responsibility? Go figure. It is but they wouldn’t. I called delta in the USA who were happy to assist however I missed your one flight and then had to take another. I refused to fly back in them. Delta rerouted me on Korean without any issue. Wrote to China southern and they finally responded in awful English explaining that they were not responsible as it’s not their ticket !!!
    Some research shows me they are not aware of skyteam policy and it’s a breach of iata regulations So good luck American they probably match your service expections

  8. @Joey : u know the saying “keep your friends close but keep your enemies even closer” ?

    From Star’s perspective, significantly weakening oneworld could have even better effects on the rest of the alliance than just gaining a member. Snatching CX over to Star won’t do much for Star, but it’ll put oneworld in a REALLY weak position in east Asia. (no, CZ is not a substitute for CX no matter what one thinks)

  9. This move underpins the limited value of airline alliances in this day and age where metal neutral joint ventures have superseded the Lufthansa model of draconian alliance loyalties. China Southern’s JV with AF-KLM should not be impacted unless of course they decide to partner with China Eastern. I suspect this may be a possibility given that Shanghai is a far more viable hub for China connections verus Guangzhou whose geographic location entails back-tracking.

    Ultimately, China Southern May well decide to forgo an alliance with Oneworld. There is little to gain from it given their limited coverage in Europe. It may well decide to pursue its own idependent partnership strategy with American. It’s really a question of who needs the other more.

    Then again Oneworld is one of the most progressive carriers in terms of allowing airlines to pursue their own network strategies- Qantas being a prime example. They would go out of their way to woo CZ given their Beijing hub and the fact that CX is not exactly the most cooperative of members. Qantas in turn may see CZ as an ideal partner to counteract CX.

  10. Skyteam is trash!

    CX will fall in line and open up to the benefits, and there are many. The HK/Mainland China Delta Pearl area is home to over 120 million people, its fine.

    CX will not go to Star which has too many Asian carriers.

    It’s time for a reshuffle of ALL the alliance, or perhaps a fourth needs to emerge.

  11. I guess Ill be cancelling the China Southern flight i booked for my status challenge for DL plat. Their extremely low fares were going to be good for keeping status with little spend.

  12. The founder members of Star do have veto rights – Lufthansa have used them more than most – remember Qatar?

    I’m not sure if later members have them though I know SQ do as they set it as a condition of their joining but it would be unlikely if the likes of A3, OU and so on have the same rights as the bigger players.

  13. @icarus sorry to hear about your experience, but I fly CZ often to China from New Zealand/ Australia and internally in China. Over the two years I have been flying them I have noticed marked improvements in cabin crew (English proficiency and professionalism), seat quality (I had the pleasure of flying their new 787-9 with new 1-2-1 J seating last week) and ground services (the new terminal and lounge in CAN has seamless connections international to domestic and vice versa, and their new international lounge is the best I’ve been to in China and better than many other lounges overseas).
    They also have very competitive J fares, often priced less than Y+ fares from this part of the world to China than QF and NZ.
    Back on topic, if they join OW that would be great. if they stay unaligned it would be a shame and make me reconsider flying them.

  14. @Aman
    China Eastern owns almost 10% of Air France-KLM same as Delta. It wouldn’t be surprising even they aligned abit closer. It’s clear to see why China Southern felt as an outsider considering these investments. Given that CZ and AF/KLM renewed their JV in July, one could assume they’ll keep it going but really who knows?

    The new airport in Beijing (Daxing) is only months away from opening and will be CZ’s other major hub. It was meant to be a Skyteam hub so it now remains to be seen what will become of that.

  15. No interest in flying to China PRC, much less fly on these sh*tty airlines – no great loss, terrible airline, terrible alliance…

  16. (Its also funny how they pot fake reviews frequently on Skytrax, which is obviously the company as you now have to verify with a boarding card)

  17. @aman I can’t see Qantas aligning with China southern, they have a strong arrangement with China Eastern and a number of code shares and even changed terminals in shanghai to be closer to China Eastern.

  18. *A requires all members to unanimously vote in a new member, whereas OW only has the founding members with veto rights. UA had used their veto before for Air India’s first attempt at joining *A.

    Not to mention NZ’s disdain for VA in Australia since the infamous breakup (and the subsequent mention of NZ using their veto) should part-owner SQ try to get VA into *A. Which is unlikely due to to other shareholders and partners (EY, HNA, DL, etc).

    I can see TG, SQ and BR using their veto to block CX from joining *A if that ever happens.

  19. I have a business class China Southern Flight from Phnom Phen to Boston that I got with my Delta FF miles. The flight is scheduled for June 2019. Will my flight be canceled/down graded etc. Any info would be greatly appreciated.

  20. Chinese govt might egg China Southern to join oneworld, just to coopt CX and shift influence over to Guangzhou amd further deligitimize HK autonomy?

    They already stop atamping passports in HK and are shoving the high speed rail to CAN and SZX.

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