Airline Alliances: What they are, how they work and why they work

One World, Star Alliance & SkyTeam - The three major airline alliances

An Airline Alliance is an arrangement amongst airlines under which airlines agree to"ally" with each other by substantially cooperating with each other in the delivery of  services. Airlines in an alliance come together to create additional value for passengers by combining their networks to create larger and denser networks and thus enabling quicker and more flexible connections for passengers passing through their hubs. Airline alliances allow airlines to harmonise branding and peripheral services offered and thereby project a stronger and more enhanced brand.
The first Airline alliance was created in the 1930s when Panair do Brasil and its parent company Pan American World Airways commenced cooperating on services to Latin America.Alliance Air was also created by the governments of Tanzania, Uganda and Zambia in 1994 after the signing of an African Joint Air Services Accord.
However, the first Airline Alliance in its current form was created after the Netherlands signed the first open skies agreement with the US in 1992, enabling American carrier Northwest Airlines and Dutch carrier KLM to commence code - sharing on a large scale as the open skies agreement permitted unrestricted landing rights on both countries' soil. The large scale code sharing and the successful dominance on certain lucrative routes by the Northwest - KLM alliance, prompted the creation of the Star Alliance in 1997, One World in 1999 and Sky Team (of which KLM is a founding member) in 2000.

By being part of an Airline Alliance, airlines derive numerous benefits which can be passed on to passengers such as

• Joint ownership of sales offices, operational facilities, airport lounges, ground staff and baggage handling personnel.  

  

   Airport Check-In Counter jointly used by SkyTeam alliance members Airfrance - KLM & Delta Airlines

• Airlines in an alliance usually operate from a single terminal (co-location) enhancing their ability to maximize economies of scale and offer a smoother and more seamless travel experience to passengers. For example, at London's Heathrow Airport where its home carrier British Airways is a founding member of the One World Alliance, Terminal 3 is exclusively by One World member airlines; similarly at Cairo International Airport which is home to Egyptian flag carrier Egypt Air(Star Alliance), Terminal 3 is dedicated for use by Egypt Air as well as all other Star Alliance airlines serving the airport.

  

  Cairo international Airport Terminal 3 used by Egyptair & other Star Alliance Airlines

• Alliance member airlines often opt to paint their aircraft in unified liveries; this boosts their brand appeal.

  

  Kenya Airway Jet sporting SkyTeam livery

  
  

  

  Ethiopian Airlines Jet in Star Alliance Livery

By harmonising schedules and services, alliance members can offer more choice and flexibility as well as an overall enhanced offfering

• Availability of a wider array of destinations provided to passengers.  
•  

• Harmonisation of mileage reward schemes which further serves to boost passenger loyalty as well as passenger retention rates.

  

  Various aircraft in alliance livery

Some concerns have been raised that Airline alliances have a tendency to stifle competition on certain routes by enabling dominant carriers to squeeze out competition and thus create a monopoly which is ultimately not in the interest of passengers.

There are three major airline alliances:

1. Star Alliance

Star Alliance and member airlines

This is the world's largest airline alliance,founded in 1997. Its membership comprises major carriers from all  parts of the world. Founding members are Air Canada, Lufthansa, Scandinavian Airlines, United Airlines and Thai Airways International. African carriers Ethiopian Airlines, Egyptair and South African Airway belong to this mega alliance. Star Alliance currently comprises 27 airlines serving 1330 cities across the world with a combined fleet size of 4657 aircraft operating on approximately 18,500 flights on a daily basis and employing roughly 432,600 individuals.

SkyTeam and member airlines

2. SkyTeam
Founded in 2000,SkyTeam  also comprises carriers from all over the world. Founding members are Aeromexico, Air France, Delta Airlines & Korean Air. Kenyan flag carrier, Kenya Airways has since 2007 been the sole African member of SkyTeam. The alliance comprises 20 airlines serving 1062 cities across the globe with a combined fleet size of 3937 aircraft operating on 17343 daily flights and employing approximately 482,000 persons.














3. Oneworld
founded in 1999, Oneworld has 15 member airlines from across the world. Founding airlines are American Airlines, British Airways, Cathay Pacific and Qantas. Oneworld has no African Airline membership. This alliance comprises 15 Airlines serving 1016 cities across the world with a combined fleet size of 3560 aircraft operating on 13,814 daily flights and employing approximately 383,000 persons.


Much smaller alliances also exist - ValueAlliance, U- Fly Alliance and Vanilla Alliance.

No West African Airline is a member of an airline alliance.
Gulf Mega carriers Emirates and Etihad Airways also belong to none of the Airline Alliances. Emirates does however have a strong partnership with Oneworld member and Australian flag carrier Qantas (more here ).

Emirates & Qantas Airbus A380s

While Etihad Airways operates a strategy of acquiring substantial stakes in air carriers across the world; (more on that here ).


.

As mentioned earlier, African carriers Ethiopian Airlines,  Egyptair, South African Airways (Star Alliance) and Kenya Airways (Skyteam) all belong to airline alliances. Membership of these alliances offers considerable benefits to these airlines , a key benefit is access to other alliance members hubs; for example South African airways operates regular scheduled services to two German cities where Star Alliance founding member Lufthansa operates mega hubs; Frankfurt and Munich. This means that South African Airways passengers are assured of smoother connections to other cities on Lufthansa's wider network out of those hubs as well as access to airport lounges and other facilities dedicated for Star Alliance member airlines. Kenya Airways also obtains similar benefits on its services to Amsterdam Schiphol Airport where Dutch Carrier KLM maintains its mega hub; through obtaining access to KLM's extensive European and North American route network. Contrast this with West Africa's largest Airline Arik Airlines who's sole European destination is to London Heathrow Airport; by not being part of an alliance, Arik is unable to offer its passengers any onward connections to other destinations from London Heathrow Airport. Its passenger feed is therefore limited solely to passengers ending their journeys at London Heathrow.

Ethiopian Airlines is a star alliance member and operates scheduled flights to Newark Liberty International Airport (EWR); where its fellow Star Alliance member United Airlines has one of its biggest hubs; as a member of Star Alliance, Ethiopian is able to gain access to United Airline's wider North American Network and can therefore carry passengers who's final destinations are points beyond EWR. Again, constrast this with West Africa's largest airline, Arik Airlines which serves New York City's nearby airport JFK where Skyteam member Delta Airlines operates its mega hub; by not being a member of Skyteam, passengers aboad Arik aircraft are unable to access Delta's extensive network out of JFK and consequently Arik is unable to carry passengers who wish to connect to points beyond JFK.

In future we'll examine major West and Central African airports which are served by airlines in various alliances as well as the options offered by these services. We'd love to hear your thoughts on all this, please hop into the comments section and sound off! Do you have further insights or perspectives on this, We'd love to hear! If you;d also like for us to feature any topics or posts, kindly let us know via email.

If you wish to experience the services of any of the airlines in these alliances, please get in touch with us at Quebix Travels, our team of travel consultants is waiting to offer you top notch services. We can't wait to surpass your highest expectations!!

+234 80 5617 6729. quebixtravels@gmail.com
Twitter: @quebixtravels