China Eastern Airlines and Delta Air Lines this morning signed an agreement to expand their partnership and better connect Delta's global network with China Eastern, as the Atlanta-based carrier looks to create more routes in the lucrative Asian market.
The agreement will include a $450 million investment by Delta to acquire a 3.55 percent stake in China Eastern.
"Delta's equity investment in China Eastern is an investment in the future success of the partnership," Delta CEO Richard Anderson said in a statement.
China is the second largest travel market from the U.S. and is projected to grow more than twice the global average, becoming the largest market from the U.S. in the next few years.
"The execution of the Subscription Agreement and the launching of commercial cooperation plan by China Eastern and Delta indicate significant strategic moves of China Eastern to comprehensively reform further, actively explore and develop mixed ownership economy, and actively promote globalized development," Shaoyong Liu, China Eastern CEO, said in a statement. "The cooperation 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."
China Eastern, with its wholly owned subsidiary Shanghai Airlines, and Delta currently operate codeshare flights on 30 domestic routes in the U.S., 43 domestic routes in China and seven trans-Pacific routes between China and the U.S. China Eastern serves the three largest U.S. markets with four nonstop flights from Shanghai, and Delta serves the three largest cities in China with six daily non-stop flights from the U.S.
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