Airline alliance
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An airline alliance is an agreement between two or more airlines to cooperate on a substantial level. The three largest passenger airline alliances are Star Alliance, SkyTeam, and Oneworld. Alliances also form between cargo airlines, such as that of WOW Alliance, SkyTeam Cargo, and ANA/UPS Alliance. Alliances provide a network of connectivity and convenience for international passengers and international packages. Alliances also provide convenient marketing branding to facilitate travelers making inter-airline codeshare connections within countries. This branding goes as far as to even include unified aircraft liveries among member airlines.
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Rationale [edit]
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This section does not cite any references or sources. (January 2013) |
Benefits can consist of:
- An extended network: this is often realised through code sharing agreements. Many alliances started as only a code sharing network.
- Cost reduction from sharing of:
- Sales offices
- Maintenance facilities
- Operational facilities, e.g. catering or computer systems.
- Operational staff, e.g. ground handling personnel, at check-in and boarding desks.
- Investments and purchases, e.g. in order to negotiate extra volume discounts.
- Traveler benefits can include:
- Lower prices due to lowered operational costs for a given route.
- More departure times to choose from on a given route.
- More destinations within easy reach.
- Shorter travel times as a result of optimised transfers.
- A wider range of airport lounges shared with alliance members
- Faster mileage rewards by earning miles for a single account on several different carriers.
- Round-the-world tickets, enabling travelers to fly over the world for a relatively low price.
Airline alliances may also create disadvantages for the traveler, such as:
- Higher prices when all competition is erased on a certain route.
- Less frequent flights: for instance, if two airlines separately fly three and two times a day respectively on a shared route, their alliance might fly less than 5(3+2) times a day on the same route. This might be especially true between hub cities for each airline. e.g., flights between Detroit (a Delta Air Lines fortress hub) and Amsterdam (a KLM fortress hub).
Issues [edit]
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This section does not cite any references or sources. (January 2013) |
The ability of an airline to join an alliance is often restricted by laws and regulations or subject to approval by authorities. Antitrust laws play a large role.
History [edit]
The first airline alliance started in the 1930s, as Panair do Brasil and parent company Pan American World Airways agreed to exchange routes to Latin America. The first large alliance started in 1989, when Northwest Airlines and KLM agreed to code sharing on a large scale. A huge step was taken in 1992 when the Netherlands signed the first open skies agreement with the United States, in spite of objections from the European Union authorities. This gave both countries unrestricted landing rights on each other's soil. Normally landing rights are granted for a fixed number of flights per week to a fixed destination. Each adjustment takes negotiating, often between governments rather than between the companies involved. The United States was so pleased with the independent position that the Dutch took versus the E.U. that it granted antitrust immunity to the alliance between Northwest Airlines and KLM. Other alliances would struggle for years to overcome transnational barriers or still do so.
The Star Alliance was founded in 1997, which urged competing airlines to form Oneworld in 1999 and SkyTeam in 2000.
In 2010 Richard Branson, chairman of the Virgin Group, announced his intention to form a fourth alliance among Virgin branded airlines (Virgin Atlantic; Virgin America; and the Virgin Australia Holdings group of airlines).[1] Then in September 2011, Branson said that Virgin would join one of the existing alliances;[2] this idea was repeated in October 2012.[3] In December 2012, Delta Air Lines purchased Singapore Airlines' 49% stake in Virgin Atlantic for £224 million. This led to speculation that the Virgin group might join SkyTeam.
On February 14, 2013, it was announced that American Airlines and US Airways would merge, retaining the American Airlines name and would remain in the Oneworld alliance; US Airways will be leaving the Star Alliance group, but no date has been announced yet.
Alliances [edit]
Membership and market data for the largest airline alliances (as of March 2013) [4][5][6]
| Star Alliance 28 members Founded 1997 |
SkyTeam 19 members Founded 2000 |
Oneworld 13 members Founded 1999 |
Rest of Industry (selected major nonaligned carriers) |
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|---|---|---|---|---|
| Passengers per year | 649 million | 506 million | 303 million | 1,223 million [7] |
| Countries | 194 | 187 | 155 | 204 (total countries) [8] |
| Destinations | 1,329 | 1,000 | 850 | 4,000 (total destinations) [9] |
| Fleet size | 4,570 | 4,150 | 2,382 | 13,082 [10] |
| Revenue Billion US$ (€) | 160.9 (124) | 97.9 (90) | 89.875 (85) | 4651,325 (3550) [11] |
| Market share | 29.30% | 24.6% | 23.2% | 22.9% |
| Current Participants¹ | Members (JP) Adria Airways 2004 (A3) Aegean Airlines 2010 (AC) Air Canada Founder (CA) Air China 2007 (NZ) Air New Zealand 1999 (NH) All Nippon Airways 1999 (OZ) Asiana Airlines 2003 (OS) Austrian Airlines 2000 (AV) Avianca 2012 (SN) Brussels Airlines 2009 (CM) Copa Airlines 2012 (OU) Croatia Airlines 2004 (MS) EgyptAir 2008 (ET) Ethiopian Airlines 2011 (LO) LOT Polish Airlines 2003 (LH) Lufthansa Founder (SK) Scandinavian Airlines Founder (ZH) Shenzhen Airlines 2012 (SQ) Singapore Airlines 2000 (SA) South African Airways 2006 (LX) Swiss International Air Lines 2006 (TA) TACA 2012 (JJ) TAM Airlines 2010 (TP) TAP Portugal 2005 (TG) Thai Airways International Founder (TK) Turkish Airlines 2008 (UA) United Airlines Founder (US) US Airways 2004 |
Members (SU) Aeroflot 2006 (AR) Aerolíneas Argentinas 2012 (AM) Aeroméxico Founder (UX) Air Europa 2007 (AF) Air France Founder (AZ) Alitalia 2001–2009 as Alitalia-Linee Aeree Italiane, rejoined 2009 (CI) China Airlines 2011 (MU) China Eastern Airlines 2011 (CZ) China Southern Airlines 2007 (OK) Czech Airlines 2001 (DL) Delta Air Lines Founder (KQ) Kenya Airways 2007 (KL) KLM 2004 (KE) Korean Air Founder (ME) Middle East Airlines 2012 (SV) Saudia 2012 (RO) TAROM 2010 (VN) Vietnam Airlines 2011 (MF) Xiamen Airlines 2012 |
Members (AB) Air Berlin 2012 (AA) American Airlines Founder (BA) British Airways Founder (CX) Cathay Pacific Founder (AY) Finnair 1999 (IB) Iberia Airlines 1999 (JL) Japan Airlines 2007 (LA) LAN Airlines 2000 (MH) Malaysia Airlines 2013 (QF) Qantas Founder (RJ) Royal Jordanian 2007 (S7) S7 Airlines 2010 (MX) Mexicana 2009 (ceased operations in 2010, but is considered an inactive member) |
Africa (AH) Air Algérie (W3) Arik Air (AT) Royal Air Maroc Asia (KC) Air Astana (AI) Air India (HU) Hainan Airlines (EK) Emirates (EY) Etihad Airways (GF) Gulf Air (IR) Iran Air (9W) Jet Airways (PK) Pakistan International Airlines (PR) Philippine Airlines (HY) Uzbekistan Airways Europe (EI) Aer Lingus (KM) Air Malta (BT) airBaltic (CA) Carpatair (CY) Cyprus Airways (LY) El Al (OV) Estonian Air (FI) Icelandair (JU) Jat Airways (DY) Norwegian Air Shuttle (UN) Transaero (AUI) Ukraine International Airlines (UT) UTair Aviation (VS) Virgin Atlantic North America (FL) AirTran Airways (AS) Alaska Airlines (BW) Caribbean Airlines (CU) Cubana (F9) Frontier Airlines (HA) Hawaiian Airlines (B6) JetBlue (WN) Southwest Airlines (NK) Spirit Airlines (VX) Virgin America (WS) WestJet Oceania (DJ) Virgin Australia South America (G3) Gol Transportes Aéreos |
| Future Members | (BR) EVA Air June 18, 2013 (OA) Olympic Air 2013 |
(GA) Garuda Indonesia 2014 |
(UL) SriLankan Airlines Late 2013 (QR) Qatar Airways Late 2013 (JJ) TAM Airlines Mid-2014 |
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| Former Members | (AN) Ansett Airlines 1999–2001, defunct (KF) Blue1 2004-2012, now a member affiliate (BD) BMI 2000-2012, absorbed into British Airways[12] (CO) Continental Airlines 2009–2011, merged with United Airlines (MX) Mexicana de Aviación 2000–2004, joined Oneworld in 2009 (FM) Shanghai Airlines 2007–2010, merged with China Eastern Airlines and joined SkyTeam in 2011 (JK) Spanair 2003-2012, defunct (RG) Varig Founder, 1997–2007, ejected |
(CO) Continental Airlines 2004–2009, joined Star Alliance in 2009 (CM) Copa Airlines 2007–2009, joined Star Alliance in 2012 (NW) Northwest Airlines 2004–2009, merged with Delta Air Lines |
(EI) Aer Lingus 2000–2007, left voluntarily (CP) Canadian Airlines Founder, 1999–2000, acquired by Air Canada (MA) Malév Hungarian Airlines 2007-2012, defunct |
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| Quality | ||||
| Average Star Rating | 3.47 | 3.24 | 3.69 | 2.85 |
| 5-Star Airlines | 42.86% | 0.00% | 42.86% | 14.28% |
| 4-Star Airlines | 31.25% | 15.625% | 15.625% | 37.50% |
| 3-Star Airlines | 15.52% | 13.79% | 6.90% | 63.79% |
| 2-Star Airlines | 0% | 0% | 0% | 100% |
| 1-Star Airlines | 0% | 0% | 0% | 100% |
Notes [edit]
- In 2005, SkyTeam launched its Associate Program, whereby existing codeshare agreements (such as with Continental Airlines and Copa Airlines) can be integrated into SkyTeam's marketing (shared loyalty programs, etc.) [2] PDF.
- Network strengths are continents or regions where listed airlines have one or more hubs or a major presence in several destinations.
- Network weaknesses are continents or regions with no hubs and few (if any) flights for any airline in the alliance.
- On June 19, 2008, Continental Airlines announced that it would be leaving SkyTeam on October 24, 2009. It began to participate in Star Alliance on October 27, 2009 as part of a codesharing agreement with Star Alliance charter member United Airlines (Continental Airlines cut its codeshare ties to Delta Air Lines and Northwest Airlines).[13][14] United Airlines and Continental Airlines merged in 2010.
- As the table shows, the three alliances combined fly 60.8% of all passengers.
- Avianca and TACA, listed as separate airlines, are considered as one member of Star Alliance.[15]
References [edit]
- ^ Perman, Stacy (2010-09-05). "Virgin's Richard Branson Circles His Wagons". TIME. Retrieved 2011-03-04.
- ^ Bruner, Jon (2011-09-14). "Virgin Atlantic Will Join an Alliance Soon, Says Richard Branson". Forbes.
- ^ Quinn, James (2012-10-26). "Virgin Atlantic to join global airline alliance, says Branson". Telegraph.
- ^ "Member airline". Star Alliance. Retrieved 2012-10-15.
- ^ "FAQ". Skyteam.com. 2000-06-22. Retrieved 2012-10-15.
- ^ http://www.oneworld.com/content/factsheet/W1_2011-09-18%20oneworld%20at-a-glance%20table.pdf
- ^ http://www.aviationbenefitsbeyondborders.org/sites/default/files/pdfs/ABBB_Medium%20Res.pdf
- ^ http://www.aviationbenefitsbeyondborders.org/sites/default/files/pdfs/ABBB_Medium%20Res.pdf
- ^ http://www.aviationbenefitsbeyondborders.org/sites/default/files/pdfs/ABBB_Medium%20Res.pdf
- ^ http://www.aviationbenefitsbeyondborders.org/sites/default/files/pdfs/ABBB_Medium%20Res.pdf
- ^ http://www.aviationbenefitsbeyondborders.org/sites/default/files/pdfs/ABBB_Medium%20Res.pdf
- ^ "Bmi Formally Leaves". Star Alliance. 2012-05-31. Retrieved 2012-10-15.
- ^ Continental Airlines – Proud member of Star Alliance. Continental.com (2009-10-27). Retrieved on 2011-03-04.
- ^ [1][dead link]
- ^ "Avianca Taca Airlines - Star Alliance". Star Alliance. Retrieved 30 November 2012.
External links [edit]
- Oneworld: http://www.oneworld.com
- SkyTeam: http://www.skyteam.com
- Star Alliance: http://www.staralliance.com
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