Following a request from the Wuhan Municipal Government, the South Central regional branch of the Civil Aviation Administration of China has ordered East Star Airlines to suspend its operations with effect from March 15, 2009.
On March 15, the 18 domestic routes and two regional routes operated by East Star were canceled, and ticket holders on these routes were transferred to flights on other carriers.
As yet there is no comment from the top management of East Star, with the exception of Wan Yijian, the president of East Star Asia Pacific, who believes that the authority has taken a drastic measure against East Star as the company's passengers were already assigned to other airlines.
East Star, which was affected by the market decline, had hoped to solve its funding problems in cooperation with the Air China Group, but their negotiations failed as East Star thought Air China was trying to acquire it through a hostile takeover.
Established in May 2005 in Wuhan, East Star is one of the four private airline companies in China. With a total of ten leased Airbus aircraft, East Star operated more than 20 routes and had three bases which were located in Guangzhou, Zhengzhou, and Wuhan.
(China Hospitality News March 18, 2009)
