Airline Alliance Review

On October 8, Qatar Airways announced that the airline is going to join Oneworld alliance which is led by International Airlines Group, the parent company of British Airways and Iberia, American Airlines, Cathay Pacific Airways and Qantas Airways. Qatar Airways is the first airline of the “Big Three” Middle East carrier to join an alliance. We will now take a look at the three major airline alliances: Oneworld, Star Alliance and Skyteam.

Oneworld

The smallest of the three alliances currently has 12 full members. The alliance was set up by 5 carriers from 4 continents-American Airlines, British Airways, Canadian Airlines, Cathay Pacific and Qantas Airways on 1998. The alliance currently has 11.6% of the global capacity according to CAPA. Three new Asian airlines: Malaysia Airlines, Sri Lankan Airlines and Qatar Airways are in line to join the alliance. With its headquarters at New York City, the alliance currently operates to 810 destinations in 149 countries across the world with a fleet of 2381 aircrafts. Members of Oneworld have contributed up to 8627 departures per day, estimate to carry 324 million passengers per year with an average load factor of 79.1%. 

Malaysia Airlines and Sri Lankan Airlines are expected to join the alliance ahead of the high-profile entrance of Qatar Airways in 2013. Kingfisher Airlines, the troubled Indian airline that was expected to join at the beginning of the year is facing serious financial difficulties as the airline is now facing a battle with financial difficulties. Apart from that, a few member airlines have left the alliance since its establishment in 1999. Malev Hungarian Airline left the alliance last year after facing financial difficulties that forces the airline to stop operations. The alliance former members include Aer Lingus which left the alliance voluntarily in 2007 and Canadian Airlines which is acquired by national carrier-Air Canada in 2000. Currently, Mexicana is still a part of the alliance despite not operating. The carrier is expected to commence operation during the year end as the airline was bought by Med Atlantic for $300 million. Oneworld alliance is more towards having corporations between member airlines. IAG and American Airlines have revenue sharing agreements on transatlantic routes. Likewise, Japan Airlines and British Airways have a similar agreement on Japan-UK routes.

Member Airline:	Country:	Member Affilates:
American Airlines	USA	American Connection, American Eagle
British Airways	UK	BA CityFlyer, Comair, Sun-air
Cathay Pacific	Hong Kong	Dragonair
Qantas Airways	Australia	Jetconnect, QantasLink
Finnair	Finland	---
Iberia	Spain	Iberia Regional, Iberia Express
LAN	Chile	LAN Argentina, LAN Ecuador, LAN Peru, LAN Express
Japan Airlines	Japan	JAL Express, J-Air, Japan Transocean Air
Royal Jordanian	Jordan	---
Mexicana	Mexico	---
Air Berlin	Germany	NIKI
S7 Airlines	Russia	Globus Airlines
Future Member Airline:	Country:	Member Affilates:
Malaysia Airlines	Malaysia	Firefly, MAS Wings
Sri Lankan Airlines	Sri Lanka	Mihin Lanka
Qatar Airways	Qatar	---

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Star Alliance

The largest airline alliance in the world currently has 28 full members. Lufthansa, the largest airline group in Europe together with SAS, Thai Airways International, Air Canada and United Airlines formed Star Alliance back in 1997. The alliance’s headquarters is situated at Lufthansa’s main hub-Frankfurt. According to CAPA, Star Alliance has 24.8% of the world’s passenger traffic. Currently, Star Alliance has a total of 4386 aircrafts, serving 678 million passengers per year. The alliance now serves 1356 airports in 193 countries. The alliance has the most destinations and countries served compared to Oneworld and Skyteam. Two airlines from Asia are in lined to join the alliance: Shenzhen Airlines, the sister company of Air China and Taiwan’s second largest carrier-EVA Air will join the alliance in the future.

Some of the previous members of the alliance include bmi, the former sister company of Lufthansa which is sold to IAG. While Spanish carrier-Spanair was left the alliance after the company fails and stopped their operations in January 2012. Ansett Australia was a high profile exit from the alliance in 2001 after the company was placed into administration. The alliance is currently at risk of losing TAM, the largest carrier in Brazil and South America because of the merger with LAN (in Oneworld) to form LATAM. Star Alliance has a particular strong presence in Europe and Africa. The alliance has the most members compared to the other two alliance in the both the continent. Star Alliance is more towards expanding its network. The alliance is planning to expand its members from the current 28 to 50 members in the future.

Member Airline:	Country:	Member Affilates:
Lufthansa	Germany	Lufthansa Regional
Scandinavian Airlines (SAS)	Denmark, Norway, Sweeden	---
Thai Airways International	Thailand	Thai Smile
Air Canada	Canada	Air Canada Express, Air Canada Jetz
United Airlines	USA	United Express
Air New Zealand	New Zealand	Air New Zealand Link
All Nippon Airways	Japan	Air Japan, ANA Wings
Austrian Airlines	Austria	Austrian Arrows, Lauda Air
Singapore Airlines	Singapore	---
Asiana Airlines	Korea	---
Adria Airways	Slovenia	---
Blue1	Finland	---
US Airways	USA	US Airways Express, US Airways Shuttle
TAP Portugal	Portugal	Portugalia, PGA Express
South African Airways	South Africa	Airlink, South African Express
Aegean Airlines	Greece	---
Air China	China	---
Avianca	Colombia	Avianca Brazil, Helicol
Brussels Airlines	Belgium	---
Copa Airlines	Panama	Copa Airlines Colombia
Croatia Airlines	Croatia	---
EgyptAir	Egypt	EgyptAir Express
Ethiopian Airlines	Ethiopia	---
LOT Polish Airlines	Poland	---
Swiss International Airlines	Switzerland	Swiss European Air Lines
TACA Airlines	El Salvador	TACA Regional, Lacsa, TACA Peru
TAM Airlines	Brazil	TAM Airlines(Paraguay), Pantanal Linhas Aereas
Turkish Airlines	Turkey	---
Future Member Airline:	Country:	Member Affilates:
Shenzhen Airlines	China	---
EVA Air	Taiwan	---

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Skyteam

The alliance was established by Air France, Delta Airlines, Korean Air, Aeroflot and Aeromexico in 2000. The second largest alliance in the world has 18.3% of the world’s total capacity. The alliance served up to 993 destinations across 186 countries with a fleet up to 2,644 aircraft. Despite being the youngest alliance of the three, the alliance has a very strong presence in both China and Taiwan. Having two of the largest Chinese carrier in the alliance and the national carrier of Taiwan, the alliance is the dominant alliance in the high-growth Chinese market. The alliance dominance in China will likely to increase with the arrival of Xiamen Airlines which is expected to join the alliance next month. Indonesia’s Garuda Indonesia is also on sight to join the alliance in 2014.

The two most high-profile former members of the alliance is Continental Airlines and Northwest Airlines. Northwest Airlines as we all know formed a merger with Delta Airlines in 2010. While Continental Airlines leave the alliance to join Star Alliance that follows with a merger with United Airlines in 2012. Copa Airlines also follows the footsteps of Continental to leave Skyteam and join Star Alliance. The only region in the world that Skyteam doesn’t really have a presence is the Oceania (Australasia) market. All the major airlines in the region are members of other alliance. Besides, Skyteam has a relatively small presence in Africa and South America with Kenya Airways and Aerolineas Argentina as the only members in the region.

Member Airline:	Country:	Member Affilates:
Aeromexico	Mexico	Aeromexico Connect
Air France	France	Brit Air, CityJet, Regional
Aeroflot	Russia	Donavia
Delta Airlines	USA	Delta Connection, Delta Shuttle
KLM	Netherlands	KLM Cityhopper
Korean Air	Korea	---
Vietnam Airlines	Vietnam	---
TAROM	Romania	---
Aerolineas Argentinas	Argentina	Austral Lineas Aereas
Air Europa	Spain	---
Alitalia	Italy	Alitalia CityLiner
China Airlines	Taiwan	Mandarin Airlines
China Eastern Airlines	China	Shanghai Airlines
China Southern Airlines	China	---
Saudia	Saudi Arabia	---
Middle East Airlines	Lebanon	---
Kenya Airways	Kenya	---
Czech Airlines	Czech Republic	---
Future Member Airline:	Country:	Member Affilates:
Garuda Indonesia	Indonesia	---
Xiamen Airlines	China	---

By,
Rafanited39
(The Editor)
sunnaero@gmail.com
22/10/2012