China Airlines acquires Shares in Yangtze River Express Airlines

China Airlines has secured a 25% stake in Yangtze River Express Airlines, becoming the largest overseas shareholder in the company. The investment is aimed at the air cargo market expansion in China. Out of the 49% share transfer, other partners except China Airlines include Yang Ming Marine Transport Corporation (which holds a 12% stake), Wan Hai Lines (with a 6% stake) and China Container Express Lines (with a 6% stake).

"The Eastern region is the epicenter of the economic development of China, and Shanghai is in the center of this region," said China Airlines Chairman, Mr. Philip Wei. "The booming economy has boosted the potential of the air cargo market. In the future, with the assistance of China Airlines, Yang Ming Marine Transport Corporation and Wan Hai Lines, Yangtze River Express Airlines can build a complete and successful sea and air cargo service network."

Established near Shanghai Hongqiao International Airport in 2002, Yangtze River Express provides regional and domestic air cargo services originating from Shanghai, with six B737-300 freighters. It now operates regional services to Korea, the Philippines, Thailand, Bangladesh and Singapore, and has secured traffic rights to Los Angeles and Frankfurt. It will introduce one or two Boeing 747 freighters in 2006.

According to Boeing estimates, mainland China will take a leading role in global air traffic growth with a projected annual growth rate of 10% for the next 20 years. Eastern China is a major source of this air cargo traffic growth, and Shanghai, as the region's gateway, accounts for more than 45% of China's air cargo traffic.

China Airlines will appoint Mr. Yung-hsiang Liu, currently its Vice President, Europe, to be the new CEO of the company, in charge of management, operations and fleet planning.

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