ABSTRACT
Yet, more and more, cross-border acquisitions and even mergers have begun to replace the more traditional alliance agreements as the industry moves from an era of concentration to a period of consolidation, in which dominant airlines seek increased control over and not merely cooperation with their foreign alliance partners.13 Most recently, consolidation can be seen on the national level in China, where, in September 2000, the Civil Aviation Administration of China (CAAC) demanded drastic consolidation of the country's more than 30 carriers, and by February 2001 a consolidation was in place. 14 Of course, consolidation extends to the international scene as well, but it is limited due to national requirements for carriers to be substantially owned and effectively controlled by national interests. In the face of these impediments, airlines of differing nationalities needing to consolidate are forced to enter into strategic alliances rather than merge, thereby 'keeping their national identities, at least formally, intact.,ls Accordingly, full international consolidation will not be possible as long as national restrictions on ownership are maintained.
