Sichuan Airlines Group is reportedly investing US$4 million to acquire a 40 percent stake in new airline Kunming Airlines Co Ltd.

Kunming Airlines will be based in Kunming Wujiaba International Airport and will offer passenger and cargo services. Pilots will be provided by Sichuan Airlines. Private investors Wang Qingmin and Wang Hui will invest the remaining 40 and 20 percent shares, respectively.

Kunming Airlines is the third Chinese airline to be based in Kunming, joining China Eastern Airlines' Yunnan subsidiary and Xiangpeng Airlines, owned by Hainan Airlines. Hopefully this new entry into the Yunnan aviation market will spur airlines here to improve service quality and offer more competitive ticket prices.

Last week while in Shanghai, we were speaking with a contact in the Asian travel industry who was saying that one of Kunming's major obstacles to becoming a regional travel and business hub was the lack of a strong Kunming airline to serve the market and connect it with outside destinations as Xiamen Airlines does for Xiamen. We'll see if Kunming Airlines is up for the task, but it appears that Sichuan Airlines is willing to throw its lot in with this new airline.