Beijing (XFN-ASIA) - Kunpeng Airlines Co Ltd, a regional carrier
jointly set up by US-based Mesa Air Group and China's Shenzhen Airlines Co Ltd,
has officially started operations, said the General Administration of Civil
The aviation regulator said in a statement on its website that Kunpeng Airlines will be based in Xi'an, the capital city of northwestern Shaanxi province, operating three CRJ-200 aircraft initially.
The carrier plans to expand its fleet to 20 aircraft prior to the Beijing Olympics in August next year and then add 20 aircraft annually.
China has recently launched polices to subsidize its largely loss-making small and medium-sized airports as well as short-hop air routes with passenger load factors lower than 80 pct, to boost the development of the country's fledgling regional aviation market.
Regional air passenger traffic accounts for less than three pct of the nation's total, far lower than the usual 30 pct level in developed international countries, according to the CAAC.
Shenzhen Airlines, which also has a cargo joint venture -- Jade Cargo International -- with Lufthansa AG, holds a controlling 51 pct stake in Kunpeng while Mesa Air's units Ping Shan SRL and Shan Yue SRL own the remainder.