Lufthansa and Cathay Pacific announced today a code share agreement that will allow them to sell tickets on some of each other’s routes. The announcement expands an existing partnership in which the two airlines already cooperate on freight flights.

This comes at a time of heightened competition for both airlines. Lufthansa is battling Gulf carriers in Asia and Cathay just posted its first full-year loss since 2008 mostly due to increased competition from Chinese carriers.

The deal is the first code share agreement for Lufthansa with an airline that is part of a rival alliance. Lufthansa is a founding member of the Star Alliance while Cathay is part of Oneworld.

The new partnership, which takes effect April 26th, will make it easier for Lufthansa, Swiss and Austrian Airlines passengers to travel to Australia and New Zealand while Cathay Pacific passengers will be able to buy tickets for Lufthansa, Swiss and Austrian flights from Frankfurt, Duesseldorf and Zurich, reaching 14 new European destinations.

Lufthansa Chief Executive Carsten Spohr said that “there are no plans to set up a full joint venture with Cathay Pacific”. But this is still good news that opens up new possibilities on both sides.

Read more at Reuters.