Wed, Dec 08, 2004 - Page 3 News List

Airline, other firms resistant to name change proposal

EXPENSIVE IDEA China Airlines said the plan would create contractual and diplomatic problems; China Steel has talked about the costs involved


China Airlines (CAL), the nation's largest carrier reiterated yesterday that it has no plan to change its name, company officials said.

For years, the airline, in which the government holds a 69 percent stake, has been asked by a grassroots alliance to replace the "China" with "Taiwan." But this time, it's President Chen Shui-bian (陳水扁) who has taken the initiative. Chen said on Dec. 5 that he planned to remove the word ``China'' from the names of all state-owned enterprises (SOEs) within two years.

"We'll have problems in aviation rights once we change our name ? that is, our planes may be barred from flying to their current destinations because we used the name to sign bilateral flight agreements," CAL chair-man Chiang Yao-chung (江耀宗), told reporters before an aircraft delivery banquet with Boeing Co on Monday in Seattle.

The second problem is contracts with the airline's lenders and code-share partners, which would trigger legal issues, he said.

"These are problems that are very difficult to resolve, so we'll maintain the status quo at this point," Chiang said.

He said it would need time to make a thorough evaluation before coming up with a solution.

The airline's name has been considered one of the company's biggest assets in the aviation industry for the past 45 years. Local media reported that CAL had commissioned a foreign consultant to evaluate the value of its brand name and the consulate valued it at US$1 billion.

Chiang denied the report. He said CAL had never conducted such evaluation, adding "We'd be very flattered if this was the value of our name."

Were the airline to change its its name to Taiwan Airlines, it would likely lose business in the face of China's pressure. In 1994, CAL removed the flag from its fuselages in a bid to avoid political pressure from Beijing. The change allowed it to rapidly increase its market share. But if it were to paint "Taiwan" on its planes, Bei-jing might retaliate.

CAL is just one of the SOEs facing the name dilemma. Others include Chinese Petroleum Corp, China Steel Corp and Chunghwa Telecom Co.

On Monday, China Steel said it has no plans to change its name. China Shipbuilding has estimated that making such a change would require it to amend more than 100 contracts, with the accompanying expense.

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