China Southern Airlines, moving to catch up with several Chinese cargo startups that are backed by established airlines, is in talks with Air France-KLM about a cargo joint venture.
The airlines released no details about the proposed joint venture, but such agreements among carriers generally are aimed at building new flight operations with dedicated freighters.
Guangzho-based China Southern, one of China's three main international carriers, gets about 8 percent of its revenue from cargo and expanded its freight and mail revenue nearly 15 percent in 2006.
But the airline also faces growing competition in the burgeoning China export market from new freight operators that have launched in the past year with backing from major carriers looking for more China business.
Funded partly by Lufthansa Cargo, Jade Cargo International is operating 747 freighters to Europe and North American out of Shenzhen. And Great Wall Airlines, partly owned by Singapore Airlines, is flying 747 freighters to Europe.