Air China will accelerate talks with Cathay Pacific Airways regarding the formation of an air cargo joint venture based in Shanghai, South China Morning Post reported. The venture is meant to pose a stronger challenge to China Eastern Airlines and Shanghai Airlines, which are set to merge later this year.

Air China posted a net profit of US$424m in the first half of 2009, up 155 per cent year-on-year thanks to higher domestic demand and lower fuel costs. Board secretary Huang Bin said that international demand had recovered on most routes, apart from those involving North America. However, despite large price cuts for business class tickets, this market has yet to show any signs of recovery.