They are going to have to rationalise as they merge

Tom Ballantyne, Orient Aviation magazine

Job cuts are thought to be inevitable from the combined workforce of 79,000 people.

The mergers - to be completed by the end of the year - should create Chinese airlines capable of competing internationally.

Scramble to merge

They should bring fresh competition for Asian airlines, including Cathay Pacific, Singapore Airlines and Japan Airlines, analysts have said.

Air China is to merge with China Southwest Airlines and China National Aviation Corp.

China Eastern will link up with Northwest Airlines and Yunnan Airlines.

China Southern will tie up with China Northern and Xinjiang Airlines to create the group with the biggest fleet.

These airlines are already significant regional carriers and many of the country's smaller regional players are also scrambling to merge.

"There are going to be job cuts, they simply can't take all these carriers, mould them into three groups and employ the same number of people, they are going to have to rationalise as they merge," Tom Ballantyne of Orient Aviation magazine told the BBC's World Business Report.

WTO pressures

The aviation industry is just one sector considering how it can take advantage of China's membership of the World Trade Organsiation (WTO).

Other moves are afoot to shake up the Chinese aviation market.

The government has reduced the tax on airport fuel, which currently accounts for about 24% of Chinese airline costs.

They are also allowing ticket discounting, where the Chinese government totally controls ticket prices.