The agreement with SkyTeam opens the carrier up to a due diligence check to see that everything in terms of service, safety, fleet quality and so on is up to the standards of the alliance, which links Delta, Air France, Korean Air and KLM amongst other airlines. Joining would make Guangzhou's new Baiyun International Airport SkyTeam's first China hub. No date was given for China Southern to formally join. SkyTeam said the carrier still had to satisfy member airlines that it could meet the alliance's quality standards.
Codeshare could deliver a lot of new feeder business from SkyTeam's member carriers at a crucial time. Travel volumes to China are exploding and, equally, China's interest in the world is correspondingly growing as Beijing busily loosens travel restrictions – no longer restricting foreign travel to group tours, for example. With China's heightened international outlook, who knows? It is not inconceivable that the next time a stake in a foreign carrier comes up for grabs, as it did when British Airways sold its stake in Qantas last month, a Chinese carrier like China Southern might just be the first in the queue.
The Guangzhou-based carrier has been having a good run of late. In August, passenger traffic was reported up 16.7% on the same month a year earlier, though the airline like many others was still recovering from the Severe Acute Respiratory Syndrome (SARS) disaster that hit Asia's whole travel industry. China Southern reported carrying 2.68 million people for August, slightly less than the 2.7 million passengers it carried in July. International traffic soared 92.8% on an annualized basis; domestic passenger traffic increased 12.7%. Cargo was also up 6.8%.