Airline alliance: Difference between revisions
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== History == |
== History == |
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The first airline alliance started in the 1930s, Air New Zealand and parent company [[Pan American World Airways]] agreed to exchange routes to [[Latin America]]. The first large alliance started in 1989, when Northwest and KLM Royal Dutch Airlines 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 others' 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 and KLM. Other alliances would struggle for years to overcome transnational barriers or still do so. |
The first airline alliance started in the 1930s, Air New Zealand 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 Royal Dutch Airlines]] 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 others' 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 and KLM. Other alliances would struggle for years to overcome transnational barriers or still do so. |
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The [[Star Alliance]] was founded in 1997 which forced competing airlines to form [[Oneworld]] in 1999 and [[SkyTeam]] in 2000. [[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).<ref>Perman, Stacy. (2010-09-05) [http://www.time.com/time/magazine/article/0,9171,2015353-1,00.html Virgin's Richard Branson Circles His Wagons]. TIME. Retrieved on 2011-03-04.</ref> |
The [[Star Alliance]] was founded in 1997 which forced competing airlines to form [[Oneworld]] in 1999 and [[SkyTeam]] in 2000. [[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).<ref>Perman, Stacy. (2010-09-05) [http://www.time.com/time/magazine/article/0,9171,2015353-1,00.html Virgin's Richard Branson Circles His Wagons]. TIME. Retrieved on 2011-03-04.</ref> |
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Revision as of 19:25, 25 January 2012
 | This article's tone or style may not reflect the encyclopedic tone used on Wikipedia. (January 2010) |
An airline alliance is an agreement between two or more airlines to cooperate on a substantial level. The three largest passenger alliances are the 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.
Rationale
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
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.
Landing rights may not be owned by the airlines themselves but by the nation in which their head office resides. If an airline loses its national identity by merging to a large extent with a foreign company, existing agreements may be declared void by a country which objects to the merger. In 2010 Swiss lost overflight rights after being bought by Lufthansa.[1]
History
The first airline alliance started in the 1930s, Air New Zealand 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 Royal Dutch Airlines 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 others' 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 and KLM. Other alliances would struggle for years to overcome transnational barriers or still do so.
The Star Alliance was founded in 1997 which forced competing airlines to form Oneworld in 1999 and SkyTeam in 2000. 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).[2]
Alliances
Membership and market data for the largest airline alliances (as of January 2012) [3] [4] [5]
| Star Alliance 27 members Founded 1997 |
SkyTeam 15 members Founded 2000 |
Oneworld 12 members Founded 1999 |
Rest of Industry (selected major non-aligned carriers) | |
|---|---|---|---|---|
| Passengers per year | 603.8 million | 474 million | 303 million | Unavailable |
| Countries | 185 | 173 | 147 | Unavailable |
| Destinations | 1185 | 916 | 766 | Unavailable |
| Revenue Billion US$ (€) | 156.8 (145) | 97.9 (90) | 89.875 (85) | Unavailable |
| Market share | 29.3% | 24.6% | 23.2% | Unavailable |
| Participants¹ | Members (JP) Adria Airways 2004 (A3) Aegean Airlines 2010 (AC) Air Canada founder (CA) Air China 2007 (NZ) Air New Zealand 1999 (NH) ANA 1999 (OZ) Asiana Airlines 2003 (OS) Austrian Airlines 2000 (KF) Blue1 2004 (BD) BMI 2000 (SN) Brussels Airlines 2009 (OU) Croatia Airlines 2004 (MS) EgyptAir 2008 (ET) Ethiopian Airlines 2011 (LO) LOT Polish Airlines 2003 (LH) Lufthansa founder (SK) SAS founder (SQ) Singapore Airlines 2000 (SA) South African Airways 2006 (JK) Spanair 2003 (LX) Swiss International Air Lines 2006 (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 Future Members (AV) Avianca 2012 (TA) TACA 2012 (CM) Copa Airlines 2012 (ZH) Shenzhen Airlines 2012 Former Members (AN) Ansett Airlines 1999–2001, defunct (CO) Continental Airlines 2009–2011, merged with United Airlines (MX) Mexicana 2000–2004, joined Oneworld 2009 (RG) Varig founder, 1997–2007, ejected (FM) Shanghai Airlines 2007–2010, merged with China Eastern and joined SkyTeam in 2011 |
Members (SU) Aeroflot 2006 (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 (RO) TAROM 2010 (VN) Vietnam Airlines 2010 Future Members (AR) Aerolineas Argentinas 2012 (GA) Garuda Indonesia 2012 (ME) Middle East Airlines 2012 (SV) Saudi Arabian Airlines 2012 (MF) Xiamen Airlines 2012 Former Members (CO) Continental Airlines 2004–2009, joined Star Alliance 2009 (CM) Copa Airlines 2007–2009, will join Star Alliance 2012 (NW) Northwest 2004–2009, merged with Delta |
Members (AA) American Airlines founder (BA) British Airways founder (CX) Cathay Pacific founder (AY) Finnair 1999 (IB) Iberia 1999 (JL) Japan Airlines 2007 (LA) LAN 2000 (MA) Malév 2007 (MX) Mexicana 2009 (ceased operations in 2010 but still a member) (QF) Qantas founder (RJ) Royal Jordanian 2007 (S7) S7 Airlines 2010 Future Members (AB) Air Berlin 2012 (IT) Kingfisher Airlines 2012 (MH) Malaysia Airlines 2012 Former Members (EI) Aer Lingus 2000–2007, left voluntarily (CP) Canadian Airlines founder, 1999–2000, acquired by Air Canada |
Americas (FL) AirTran Airways (AS) Alaska Airlines (CU) Cubana (F9) Frontier (G3) Gol Transportes Aéreos (HA) Hawaiian Airlines (B6) JetBlue (WN) Southwest (VX) Virgin America (WS) Westjet (NK) Spirit Airlines Europe / C.I.S (EI) Aer Lingus (VV) Aerosvit (KM) Air Malta (CY) Cyprus Airways (FI) Icelandair (JU) Jat Airways (DY) Norwegian Air Shuttle (DY) Olympic Air (FV) Rossiya (UN) Transaero (DY) Uzbekistan Airways (VS) Virgin Atlantic Africa & Middle East (AH) Air Algérie (W3) Arik Air (LY) El Al (EK) Emirates (EY) Etihad Airways (GF) Gulf Air (IR) Iran Air (QR) Qatar Airways (AT) Royal Air Maroc (TU) Tunisair Asia (AI) Air India (BG) Biman Bangladesh Airlines (BR) EVA Airways (HU) Hainan Airlines (9W) Jet Airways (PK) Pakistan International Airlines (PR) Philippine Airlines (UL) SriLankan Airlines |
| Network Capacity | ||||
| Within North America | 23% | 28% | 15% | 34% |
| Within South America | 1% | 2% | 14% | 83% |
| Within Europe | 20% | 16% | 11% | 53% |
| Within Middle East | 2% | 0% | 3% | 95% |
| Within Africa | 23% | 10% | 4% | 63% |
| Within Asia | 35% | 11% | 9% | 45% |
| Within Oceania | 11% | 0% | 32% | 57% |
| Between N. America and Europe | 27% | 34% | 21% | 18% |
| Between N. America and S. America | 9% | 29% | 40% | 22% |
| Between Europe and S. America | 20% | 28% | 22% | 30% |
| Between N. America and Asia | 41% | 29% | 10% | 20% |
| Between Europe and Asia | 36% | 22% | 19% | 23% |
| Quality | ||||
| Average Star Rating | 3.29 | 3.19 | 3.73 | 2.87 |
| 5-Star Airlines | 40% | 0% | 20% | 40% |
| 4-Star Airlines | 29.03% | 12.9% | 12.9% | 45.17% |
| 3-Star Airlines | 13.93% | 9.01% | 4.91% | 72.15% |
| 2-Star Airlines | 0% | 0% | 0% | 100% |
| 1-Star Airlines | 0% | 0% | 0% | 100% |
| 0-Star Airlines | 0% | 0% | 1,06% | 98,94% |
Notes
- In 2005, SkyTeam launched its Associate Program, whereby existing codeshare alliances (such as Continental and Copa) can be integrated into SkyTeam's marketing (shared loyalty programs, etc.) Template:PDFlink.
- 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 announced that it would be leaving SkyTeam on October 24, 2009 and began participating in Star Alliance on October 27, 2009 as part of a codesharing agreement with Star Alliance charter member United Airlines (Continental cut its codeshare ties to Delta and Northwest).[6][7] United and Continental merged in 2010.
- As the table shows, the three alliances combined fly 60.8% of all passengers.
References
- ^ Moscow's muscle flexing about overflight rights aims beyond Switzerland | World | Deutsche Welle | 12.06.2010. Dw-world.de (2010-02-22). Retrieved on 2011-03-04.
- ^ Perman, Stacy. (2010-09-05) Virgin's Richard Branson Circles His Wagons. TIME. Retrieved on 2011-03-04.
- ^ [1]
- ^ [http://www.skyteam.com/en/General-information/FAQ/
- ^ [2]
- ^ Continental Airlines – Proud member of Star Alliance. Continental.com (2009-10-27). Retrieved on 2011-03-04.
- ^ [3][dead link]
External links
- oneworld: http://www.oneworld.com
- SkyTeam: http://www.skyteam.com
- Star Alliance: http://www.staralliance.com