(Bloomberg) -- China Southern Airlines Co. will invest 10 billion yuan ($1.5 billion) in Xiongan, the new city spearheaded by Chinese president Xi Jinping that aspires to be a model for China's future urban development.
The airline operator will allocate 2.5 billion yuan in cash and 7.5 billion yuan in tangible assets to set up a subsidiary called China Southern Airline Xiongan Co. in the city, to provide flight services and sales of aviation materials, according to a stock exchange filing Friday.
Xiongan, which President Xi Jinping designated just over a year ago, wants to be a high-tech city teeming with leading-edge companies and world-class transportation. The city has attracted investment -- both for business opportunities and political reasons -- from some of China's largest companies.
E-commerce giant Alibaba Group Holding Ltd. will connect the city's transportation, energy and water supply to its cloud. Search engine Baidu Inc.'s Apollo autonomous driving system will also play a role in Xiongan's transport network.
A high-speed train between the capital Beijing and Xiongan is expected to be operational by the end of 2020, cutting the commute to about 30 minutes.
To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net
To contact the editors responsible for this story: Stanley James at sjames8@bloomberg.net, Cormac Mullen, Bruce Grant
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