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ONW-2005-09-B LHR LAX
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ONW-2012-03 BER MEMBER
ONW-2013-02 - NEW ONEWORLD MEMBER
Oneworld (ONW) was established in 1999. It is an airline alliance. The alliance management company is based in Vancouver, British Columbia, Canada. In the middle of 2011, the OneWorld (ANW) alliance headquarters will move to Manhatten New York 46,200 sq ft facility:
Address (in Mid-2011):
2 Park Avenue
Manhattan, New York
The (ONW) Management Company had its head office in Vancouver, Canada, ideally located to support its member airlines across the world. A small team covered positions in the areas Commercial, Airports & Customer Experience, Membership and Information Technology (IT)/E-Commerce. Vancouver staff were usually on local contracts. Additionally, some commercial positions existed in the market and on secondment basis.
Oneworld (Oneworld Management Company Ltd) (ONW) is the third largest airline alliance after Star Alliance (SAL) and SkyTeam (STM). Alliance member airlines and affiliates co-operate to provide an integrated service, usually around the use of common passenger terminals and standardization of frequent flier schemes.
The alliance had a Managing Partner, reporting to the alliance board, which was made up of the Chief Executives of each of the member airlines. The Chairman of the board is held on a rotating basis. Reporting to the Managing Partner were function heads for Commercial, Information Technology (IT), Public Relations, Airports & Customer Experience, and a Global Project Director. Member airlines have developed common specifications across their engineering and maintenance activities, reducing costs through bulk buying and parts sharing.
The alliance expanded rapidly in 2007 when Japan Airlines (JAL)/(JAS), Royal Jordanian (RJA) and Malév Hungarian Airlines (HGA) joined as member airlines, while three subsidiaries of (LAN) Airlines, Dragonair (DRG) and four subsidiaries of Japan Airlines (JAL)/(JAS) joined as affiliate airlines. The Oneworld (ONW) alliance now reaches roughly 700 destinations in nearly 140 countries. It operates almost 9,000 daily flights, carrying over >330 million passengers on a combined fleet of over >2,200 airplanes. It is the only alliance that has a full network in Australia with Qantas (QAN) and the only alliance with a member based in South America with (LAN) Airlines . In 2007, alliance members earned a combined profit of +US$7.8 billion, against combined losses by Star Alliance (SAL) carriers totaling more than >-US$2.2 billion and an overall deficit by SkyTeam (STM) members in excess of >-US$7 billion.
February 1999: Oneworld Alliance (ONW) is launched.
January 2004: Oneworld (ONW) was voted the "World's Best Airline Alliance" in the 2004 Business Traveller Awards.
May 2006: Aer Lingus (ARL) and the Oneworld (ONW) alliance confirmed that Ireland's flag carrier is leaving the alliance. The decision was approved at the airline's board meeting, concluding a process that began when former (ARL) boss, Willie Walsh toyed with leaving the partnership as he began the transformation of the state-owned carrier from a network operator into a point-to-point Low Cost Carrier (LCC). "(ONW) alliance membership has inevitably become less relevant for the airline over time, with an increasing number of customers availing of our new direct services at low fares," current Chief Executive, Dermot Mannion said. "(ARL)'s strategy has changed fundamentally since it joined the alliance six years ago and is no longer convergent with (ONW)'s," the (ONW) said in a statement.
(ARL) joined (ONW) on June 1, 2000. (ARL) did not provide a time frame for departure, but is required to give its partners one year's notice. (ONW) said the timing and terms for the withdrawal will be considered at the next meeting of its governing board, but that it likely will occur early next year, when Japan Airlines (JAL), Malev Hungarian Airlines (HGA), and Royal Jordanian (RJA) are expected to join.
(ONW) also noted that (ARL) is its smallest member, with about 2% of total capacity (ASK)s offered in 2005, whereas its three new members will increase capacity by more than +20%. "Talks are progressing between (ONW) and other airlines interested in joining," it stressed in a statement.
September 2006: Oneworld (ONW) has the following members:
Aer Lingus (ARL)------------JUN-2000------12,563------8-----1,093---
American Airlines (AAL)---SEP-1998----222,412-----98----20,712----
British Airways (BAB)------SEP-1998------111,859-----36---15,122---
Cathay Air Pacific (CAT)---SEP-1998-------65,110-----15-----6,548----
Iberia Airlines (IBE)---------SEP-2000------49,060-------28-----6,073
Qantas Airways (QAN)-------SEP-1998-----86,986-----33-----9,524--
Japan Airlines (JAL)---------------------------100,345-----58---19,346
Malev Hungarian Airlines (HGA)---------------4,406------3------603
Royal Jordanian Airlines (RJA)----------------5,504------2------772
February 2007: Oneworld (ONW) confirmed that Royal Jordanian (RJA), Japan Airlines (JAL)/(JAS), and Malev Hungarian Airlines (HGA) will join (ONW) as full members on April 1. Five additional subsidiaries of (JAL)/(JAS) will join the same day as affiliates: JALways (JAI), Japan Asia Airways (JAA), JAL Express (JEX), J-AIR and Japan Transocean Air (SWL). At the same time, Aer Lingus (ARL) will withdraw from (ONW). Three other airlines are lining up to join as affiliates in 2007: Dragonair (DRG), LAN Argentina (LNR), and LAN Ecuador (LNE). The membership changes will expand Oneworld's reach to almost 700 airports, nearly 150 countries and 9,000 daily departures by around 2,500 airplanes.
June 2007: Buoyed by its membership in Oneworld (ONW) and its recent privatization, Malev Hungarian Airlines (HGA) expects to report a -HUF7.5 billion/-$40.1 million pre-tax loss this year compared to -HUF10.5 billion in 2006, along with an operating loss of -HUF5.3 billion that will represent considerable improvement from the -HUF10.8 billion deficit suffered last year. (HGA) said its gains will be based on "increasing passenger traffic, an even greater market share and the impact on growth in traffic deriving from membership [in (ONW)]," which it said will benefit its bottom line by +HUF3 billion, in addition to "extremely rigorous cost management."
(ONW)'s original seven member (less (HGA), (JAL)/(JAS) & (RJA)) carriers enjoyed a +10% increase in revenues from (ONW) fares and sales activities to $675 million last year, two-thirds of which was classified as money the airlines earned thanks to their membership, (ONW) said. Revenue from corporate sales climbed nearly +66% while approximately 8 million passengers - - one in every 30 - - transferred between member carrier flights. Revenue generated from those transfers rose +5% to around $2 billion, or 3.5% of members' total passenger turnover. Savings generated by joint procurement totaled nearly -$300 million.
July 2007: Moscow Domodedovo (DME) Director Sergey Rudakov said the airport landscape in the Russian capital, which features three international gateways, is on the verge of significant change. The day after Lufthansa (DLH) announced it would join six Star Alliance (SAL) partners by shifting its operations south from Sheremetyevo (SVO) to (DME), Rudakov said that (DME) is working to bring all Oneworld (ONW) airlines to the airport as well. "We believe that is possible," he said. British Airways (BAB), Royal Jordanian (RJA) and Iberia (IBE) currently operate from (DME), while Cathay Pacific Airways (CAT), Japan Airlines (JAL), and Finnair (FIN) are at (SVO).
Rudakov said (DLH)'s shift, and its new partnership with AiRUnion (ZXD)/(DOD)/(OMK)/(SMR), will make it the dominant foreign carrier in Russia and will effect "a big change in Moscow." (DLH) will be (DME)'s 28th foreign airline. He claimed there will be enough business for (SVO) and Vnukovo (VKO) as well: "In the next three years, Moscow airports can expect to generate up to +15 million new passengers." Roughly 80% of Russian passengers come from Moscow, he said, and angling for airline alliances and customers wanting to transfer easily, will be a key component of future airport competition.
Currently, (SVO) processes around 14 million passengers annually, (VKO) has 7 million, and (DME) expects +21% year-over-year passenger growth to 18 million. "By 2015, we estimate 40 million passengers. Then we could be one of the top five airports in Europe," he said.
The airport has invested $240 million of its own money in improvements over the past three years, but Rudakov said that "to keep our position, we need [third-party] investment." At the same time, he has no interest in investing in other airports. "Why should we spend money in, let's say, Vladivostok, where we can add maybe 100,000 extra passengers, when with same money we can get 2 million more guests at (DME)," he asked. Part of that investment has gone toward increased cargo handling capacity. (DME) will build a cargo village and will shortly welcome a new twice-weekly Asiana Airlines (AAR) 747F service from Seoul.
Russia's S7 Airlines (SBR) said it has been negotiating a potential (ONW) membership with British Airways (BAB). "Members of (ONW) alliance are interested in having a reliable partner in the Russian aviation market, which today is one of the most promising and rapid-growing markets," S7 (SBR) said. "(SBR) can become such a partner, as it possesses a unique and the most developed route network in Russia." Aeroflot (ARO) is a member of SkyTeam (SKT) and AiRUnion (ZXD)/(DOD)/(OMK)/SMR), which said it intends to join an alliance by 2015, recently has forged strategic partnerships with Star Alliance (SAL) members Lufthansa (DLH) and Austrian Airlines (AUL).
(ONW) partners American Airlines (AAL), Iberia (IBE), Finnair (FIN), Malev Hungarian Airlines (HGA), and Royal Jordanian (RJA) filed a request for antitrust immunity with the USA Department of Transportation (DOT), effective March 30, 2008, the day the USA-(EU) "open skies" agreement becomes active. The five carriers said they wish to cooperate on code sharing, loyalty programs, route and schedule planning, advertising and marketing, pricing and yield management, revenue allocation, ground handling, cargo, Information Technology (IT) and distribution, and other areas. "We believe that an alliance with antitrust immunity is of vital strategic importance and will help us remain competitive with other transatlantic alliances, that already have such immunity," (AAL) Senior VP Planning, Henry Joyner said. Six SkyTeam (SKT) carriers filed a similar request last month.
September 2007: Talking to delegates at the Congress, John McCulloch, managing partner at Oneworld (ONW) Alliance, announced that Dragonair (DRG) will become a full member of (ONW) from November 1, 2007. In December last year, (DRG) was elected as a (ONW) affiliate, after becoming a wholly owned part of the Cathay Pacific (CAT) group. “It will have taken us just 11 months to implement (DRG) – and we expect it to join (ONW) before Star Alliance (SAL) or SkyTeam (SKT) can bring on board their new Chinese recruits,” said McCulloch. McCulloch added the decision to take on (DRG) was due to its ability to match the best of its existing members’ standards, which includes (CAT), (BAB), American Airlines (AAL), and (JAL). “This has been recognized with its outstanding success in the various airline industry award schemes. Just recently, (DRG) was named "Best Airline in China" by SkyTrax for the sixth straight year running,” said McCulloch. The deal increases (ONW)’s coverage considerably, as it serves a total of 19 mainland China airports with some 400 flights a week. (DRG) operates to 12 Chinese destinations that will be new to the (ONW) network: Chongqing, Changsha, Chengdu, Fuzhou, Haikou, Kunming, Guilin, Ningbo, Nanjing, Shenyang, Sanya, and Wuhan. In addition, (ONW) will expand to Cambodia via (DRG)'s flights to Phnom Penh. “With the 10 points already served by other members of (ONW), this adds up to an impressive network - more than doubling the number of airports our alliance offers there to 22.”
October 2007: Barcelona International Airport's new Sur terminal will be used by 42 airlines, including Oneworld (ONW) members and "associates" Clickair (CLK) plus Air Nostrum, and Star Alliance (SAL) members plus affiliates Air Comet (APZ) and Aerolineas Argentinas (ARG), Spanish airports operator (Aena) announced. Vueling Airlines (VUZ) also will operate from the new terminal. SkyTeam (STM) carriers, which requested to operate out of T Sur, instead will have exclusive use of the existing Terminal A, while other low-cost operators and airlines without intercontinental flights, will operate out of the B and C terminals.
Finnair (FIN) said it has approved a new long-term plan that focuses on developing Europe - Asia services, with a future goal of also boosting North America - Asia service by turning Helsinki Vantaa into a significant connecting hub. "We will take advantage of Helsinki's geographical location even more extensively," President & CEO, Jukka Hienonen said. "In years to come, the airspace and terminal facilities of large European airports are likely to become increasingly congested while Helsinki-Vantaa Airport has plenty of room for construction and possibilities for development."
Finnair (FIN) said total annual passengers carried are expected to rise from 9 million currently, to more than >20 million by 2017. "If the demand in air traffic continues to increase, within 10 years, we expect to carry well over 3 million passengers annually in our intercontinental traffic between Europe, Asia and North America," Hienonen said. Focus in the near term will be on Europe - Asia growth, he stated, adding that the most "interesting future cooperation candidates are to be found among the Asian Oneworld (ONW) airline partners."
November 2007: Dragonair (DRG) officially joined Oneworld (ONW), becoming the alliance's 11th member carrier. Its affiliation will add 15 new destinations to the Oneworld (ONW) network, including 12 in mainland China. "Our strong market presence in the mainland will give passengers greater access to this fast-growing market, and at the same time, we can help people connect with our growing network of niche destinations around the region," CEO, Kenny Tang said. Dragonair (DRG), now part of the Cathay Pacific (CAT) Group, operates 31 passenger airplanes and seven freighters to 33 destinations, including 21 in mainland China.
Oneworld (ONW) members (CAT), British Airways (BAB), and Qantas (QAN) opened the first airport lounge developed as an "alliance project" in Los Angeles International Airport's international terminal. Passengers flying Japan Airlines (JAL) or (LAN) Airlines (which operate from that terminal), and elite members of other alliance carriers, will have access to the 1,360-sq-m facility. American Airlines (AAL) maintains its own lounge in Terminal 4.
January 2008: Japan Airlines (JAL) will link its loyalty program to those of China Eastern Airlines (CEA) and Mexicana (CMA) from February 1. (JAL) has similar agreements with Air France (AFA), Emirates (EAD), and its oneworld (ONW) partners.
February 2008: Oneworld (ONW) airlines will begin bringing all operations together at Beijing International in the airport's vast new passenger terminal. British Airways (BAB) and Qantas (QAN) will move on February 29, while the alliance's other members serving Beijing (Cathay Pacific (CAT), Dragonair (DRG), Finnair (FIN), and Japan Airlines (JAL)) will transfer into Terminal 3 on March 26. The six Oneworld (ONW) carriers will use check-in desks in the terminal's Area C.
March 2008: The USA Dept of Transportation (DOT) and the European Commission (EC) announced a "joint research project" to determine the impact of airline alliances on competition and the potential impact of transatlantic "open skies." The bodies will interview airlines, travel agents, analysts and consumer groups, in addition to performing data analysis. A report will be published in mid-2009.
Oneworld (ONW) airlines serving Shanghai Pudong will begin colocating in Terminal 2, when British Airways (BAB) and Qantas (QAN) transfer to the new facility. Finnair (FIN), Cathay Pacific Airways (CAT), and Dragonair (DRG) will follow on April 29, and American Airlines (AAL) will move at an unspecified date. It currently operates out of T1, where Japan Airlines (JAL) will remain.
April 2008: Mexicana (CMA) accepted the formal invitation to join the Oneworld (ONW) alliance, giving the group 11 members and a second Latin American foothold; (LAN) Airlines joined in 2000.
Iberia (IBE) will be the sponsor carrier for Mexicana (CMA) and its Click Mexicana (AEB) subsidiary as it targets 2009 membership. "For Mexicana (CMA), joining Oneworld (ONW) will strengthen its competitive offering and its financial position. For Oneworld (ONW), adding Mexicana (CMA) will expand the alliance's network in Mexico and Central America, and enable it to build further on its positions as the leading airline grouping, serving Latin America and the leading Spanish-speaking alliance," the parties said in a joint statement.
Mexicana (CMA) and Click (AEB) will add 26 new destinations to the Oneworld (ONW) network: 24 in Mexico, Bakersfield, and Edmonton. It also is the largest non-USA airline at Los Angeles International. Oneworld (ONW) then will serve more than >130 airports in Latin America and nearly 700 destinations globally with a combined fleet of 2,350 airplanes.
"In the three years that Iberia (IBE) and Mexicana (CMA) have been working closely together as bilateral partners, we have come to know that in Mexicana (CMA), we have colleagues with whom we can really do business - - partners who can add real value to one another," (IBE) Chairman & CEO, Fernando Conte said. American Airlines (AAL) will assist (IBE) in bringing Mexicana (CMA) into Oneworld (ONW) compliance.
Mexicana (CMA) (46) and Click (AEB) (22) serve 63 destinations in 11 countries. The mainline operates a fleet of 30 A320s, 20 A319s, 10 A318s, and two 767s, while (AEB) flies 18 F 100s on 115 daily flights. In 2007, privately held Mexicana (CMA) transported 9 million passengers and Click (AEB) 2.2 million.
Last year, Oneworld (ONW) added Japan Airlines (JAL), Malev Hungarian Airlines (HGA), Royal Jordanian (RJA), and Dragonair (DRG), following the latter's acquisition by Cathay Pacific Airways (CAT).
June 2008: Oneworld (ONW) airlines generated "record" revenues from the alliance's sales activities in 2007, Managing Partner, John McCulloch said. Eight million passengers transferred between the members' flights during the year, +6% more than in 2006, producing interline revenues within the alliance of $2.2 billion, up +19%. Revenue generated by Oneworld (ONW) fares and sales activity exceeded $725 million, a +10% increase. A key driver was membership expansion, with Japan Airlines (JAL), Malev Hungarian Airlines (HGA), and Royal Jordanian (RJA) joining as full members and (LAN( Argentina, (LAN) Ecuador, and Dragonair (DRG) as affiliates.
"We never claimed to be the biggest [alliance] networkwise, but we claim to be the only true global alliance," McCulloch said, a judgment he qualified by adding, "If you exclude Turkey," which straddles Europe and the Middle East, from the Middle East region. Moreover, he said, "we are the airline grouping with collectively the best financial track record, even if some members individually posted losses." Oneworld (ONW) claims its members averaged an operating margin of 6.4% based on the latest full-year results against 5.8% for Star Alliance (SAL), and 5.6% for SkyTeam (STM).
McCulloch revealed that Oneworld (ONW) is keen on adding British Airways (BAB)'s new "OpenSkies" subsidiary, which launches its first flight this month between Paris Orly and New York (JFK). "OpenSkies is still doing the assessment. Adding a member is a two-way process. For an alliance, it is important to get them in, but they have to want to be in and carry the cost." He reiterated that Oneworld (ONW) hopes to add members in mainland China and India. "Yes, we are talking to China Eastern, again . . . I don't think we'll see any announcement this year," he said. Regarding Continental Airlines (CAL), which has confirmed it is talking with (BAB) and American Airlines (AAL) about a partnership, McCulloch said "There is nothing to add. We have to wait to see how it evolves." He admitted that the increasing trend to unbundle services by network carriers is an issue for the alliance, which sets certain service levels as a condition to membership. (AAL) last month started charging most domestic passengers for the first checked bag to offset its rising fuel costs. "Oneworld (ONW) interline customers are not affected by this decision, but if they would have been it would have been a problem for us," he said. "We as an alliance will have to draw a line."
July 2008: American Airlines (AAL), British Airways (BAB), and Iberia (IBE) are close to applying for antitrust immunity (ATI) to form a transatlantic revenue- and profit-sharing joint venture, the "Financial Times" reported, citing executives at the carriers. (BAB) and (AAL) tried to gain antitrust immunity twice in the past, but they abandoned those efforts because they considered the concessions required to gain approval, specifically the surrender of a large number of slots at London Heathrow, to be out of balance. Earlier this year, (AAL) Senior VP International Craigh Kreeger indicated that the new (EU)-USA "open skies" agreement might spur the pair to consider another transatlantic (ATI) application. "(BAB) has been in talks with American Airlines (AAL) and Iberia (IBE) for some time, but no decisions have been reached," (BAB) said. The European Commission (EC) said it had not been approached by the Oneworld (ONW) trio about the reported alliance. (BAB) and (AAL) are the only major transatlantic codesharing pair that does not benefit from (ATI).
Virgin Atlantic Airways (VAA) reacted promptly and negatively to the reports. "We would oppose this attempt to create an anticompetitive alliance," Director Communications, Paul Charles said. "It would form a dominant mega-power on transatlantic air routes from two of the largest (EU) members, forcing up ticket prices for passengers and restricting choice."
An alliance of six SkyTeam (STM) airlines won antitrust immunity from USA authorities in May, while Continental Airlines (CAL) said a transatlantic joint venture with United Airlines (UAL) was one of its incentives to leave SkyTeam (STM) and join the Star Alliance (SAL).
Oneworld (ONW) named SITA VP Airport Hubs and former El Al (ELA) CIO, Moshe Levertov as VP Information Technology (IT) & Cost Reduction, succeeding the retiring Bob McNair.
August 2008: Oneworld (ONW) partners, American Airlines (AAL), British Airways (BAB), Iberia (IBE), Finnair (FIN), and Royal Jordanian (RJA) confirmed that they filed for worldwide antitrust immunity (ATI) from the USA Department of Transportation and notified the appropriate regulatory authorities in the European Union (EU). The (ATI) application follows the signing of a "joint business agreement" among (AAL), (BAB), and (IBE), under which the trio will cooperate commercially on flights between North America and the (EU), Switzerland and Norway. Their combined network will serve 443 destinations in 106 countries with 6,200 daily departures. The carriers stressed they will share revenue but not profit and will continue to operate as separate legal entities. However, (BAB) and (IBE) are discussing a potential merger. "We believe our proposed cooperation is an important step towards ensuring that we can compete effectively with rival alliances and manage through the challenges of record fuel prices and growing economic concerns," (AAL) parent, AMR Chairman & CEO, Gerard Arpey said. At present, Oneworld (ONW) is the only alliance not operating with some level of transatlantic (ATI), whereas six SkyTeam (STM) airlines and nine Star Alliance (SAL) carriers enjoy such immunity. "This has put Oneworld (ONW) at a considerable disadvantage," (ONW) Managing Partner, John McCulloch claimed. (BAB) and (AAL) have applied twice for transatlantic (ATI), in 1997 and 2001, but believe they now have a greater chance of success because the industry and competitive landscape have changed so fundamentally. "We are applying for (EU)-USA antitrust immunity in a changed regulatory world, where London Heathrow is open to any USA or (EU) airline that wants to fly to the USA and where rival alliances have immunity," (BAB) CEO, Willie Walsh stressed. "It will increase competition as the three global airline alliances will play under the same rules. We are taking a very important step towards consolidation , which is necessary in today's aviation industry," (IBE) Chairman & CEO, Fernando Conte said.
Virgin Atlantic Airways (VAA), which earlier stepped up its lobbying against the anticipated application of its main competitors at (LHR), described the deal as a "monster monopoly," claiming it would "be bad for passengers, bad for competition, and bad for the UK and USA aviation industry."
(BAB) noted coolly that there "is nothing to stop Virgin (VAA) applying for (ATI) if it found a suitable partner" and "nothing to stop Virgin (VAA) increasing competition on any transatlantic route if it thinks consumers would welcome it."
Finnair (FIN) is the first European Oneworld (ONW) member to operate airplanes with alliance livery, following Japan Airlines (JAL) and LAN Argentina (LNR). One A340 and one A319 feature the Oneworld (ONW) script along the front of the fuselage with the tails of the group's member carriers toward the rear.
British Airways (BAB) and Qantas (QAN) are exploring a potential merger "via a dual-listed company structure," both carriers confirmed in a brief statement responding to recent speculation. The Oneworld (ONW) partners warned that there is "no guarantee that any transaction will be forthcoming" and did not offer any timeline for a possible transaction. Revelation of the merger discussions coincided with the publication of a proposal by the Australian government to relax the rules of foreign ownership in (QAN). The plans will not permit a full takeover of the flag carrier but will allow a single foreign entity to own up to 49%. Currently, a single foreign entity can own only 25% and a group of foreign entities or airlines can hold up to 35%.
(BAB) bought a 25% stake in (QAN) in early 1993, for A$665 million/$429.7 million, two years before (QAN) floated. A 2002 rights issue subsequently diluted (BAB)'s stake to 18.25%. It sold its shareholding in 2004, and used the gross proceeds of A$1.1 billion to pay off part of its debt.
The pair operates a revenue-sharing joint venture on the so-called 'kangaroo route' between the UK and Australia, under which they jointly organize capacity, schedules, sales, and operations.
(BAB) said merger discussions with Iberia (IBE) are continuing.
The proposed merger of (BAB) and (QAN) already is generating controversy in Australia, some 19 months after similar sentiments helped derail a leveraged buyout of (QAN) by a multinational consortium. The Australian government issued a new aviation policy proposal raising the amount a single overseas interest could take in Qantas (QAN) to 49% from 25%, but the governing Labor party remained concerned that (BAB)'s tie-up with (QAN) could be a de-facto takeover. "Were that to be the case, the government would certainly not support it," Minister for Infrastructure, Transport, Regional Development & Local Government, Anthony Albanese told "ABC Radio." "Whilst (QAN) and (BAB) have put out a statement confirming these talks, they're far from reaching a conclusion and the outcome [is] far from certain," he added, stressing that it has been "made clear" to (QAN), that its arrangement with (BAB) must adhere to national law. The Treasurer of Australia, Wayne Swan said, "Our bottom line is the 'Flying Kangaroo' remains majority Australian-owned and based," "Reuters" reported.
Warren Truss, leader of the opposition National Party, told ABC's "The World Today" that "if one company owns up to 49% of (QAN), then they would have effective control. Indeed, they would achieve effective control at a level much lower than that, and Australians would want to be certain that they still had an airline that would put the interests of this country first and that their capacity to serve Australia was not compromised." Local editorials and public opinion polls also suggested opposition to the merger.
January 2009: Oneworld (ONW) was named the "World's Leading Airline Alliance" for the sixth consecutive year at the 2008 World Travel Awards.
British Airways (BAB) CEO, Willie Walsh reiterated that he is confident (BAB)'s application for anti-trust immunity (ATI) with American Airlines (AAL) and three other (ONW) carriers will be approved and that the planned merger with Iberia (IBE) will go ahead. Even if those initiatives fail, he said plenty of options remain, "Bloomberg News" reported. "There is no shortage of airlines for acquisition. I get phone calls from CEOs all the time saying, 'Please buy us.' We have to be picky."
Meanwhile, Chairman, Martin Broughton said that receiving regulatory approval for (ATI) with (AAL) is a higher priority than an all-share merger with (IBE). He told "The Daily Telegraph" that the tie-up with (AAL) is "the most important deal" and that "it's worth a lot of money - - hundreds of millions - - and prevents the breakup of (ONW)." Broughton said (BAB) shareholders would expect at least 60% of any combination with (IBE). "There is no magic number but below <60% it would be a struggle to sell it," he revealed.
(ONW) announced the following London Heathrow relocations: Finnair (FIN) will transfer to Terminal 3 from T1 on January 27; Iberia (IBE) will switch to T3 from T2 on February 25; (BAB) will transfer remaining flights at T1 to T3 on FebRUARY 25. (AAL), (CAT), Japan Airlines (JAL) and Royal Jordanian (RJA) all are based in T3. Qantas (QAN) will switch over from T4 later this year.
February 2009: Oneworld (ONW) has no plans to change its strategy and remains interested in adding new members only in Brazil, Russia, India and mainland China, Governing Board Chairman & American Airlines (AAL) Chairman & CEO, Gerard Arpey said at Madrid marking (ONW)'s 10th anniversary. Since its 1999 launch, (ONW)'s membership has doubled to 10 airlines plus 20 affiliate members. Mexicana (CMA) will become the 11th later this year. But it remains the smallest of the three global groupings.
"Quite frankly, our approach differs from that of other alliances," Arpey said. "Our focus has always been on quality rather than quantity, on service rather than size. This is what makes (ONW) stand out as an alliance and that will not change."
Beyond the aforementioned countries, Arpey said there is "relatively little opportunity for expanding our roster without diluting the quality we offer our customers, or the value the alliance creates for its existing members." Brazil's TAM (TPR) and Air-India (AIN) already have been claimed by the Star Alliance (SAL).
Arpey stressed that (ONW) has achieved the "best collective profitability of any alliance." He said members earned $11.3 billion in the past decade compared to $9.3 billion for (SAL) and a -$19.5 billion loss by SkyTeam (STM) carriers.
Revenue from alliance fares and sales activities surpassed $850 million in 2008, compared to about $200 million in the first year of operation, and totaled $5 billion in the alliance's first decade. Around two-thirds of this is considered incremental. Interline revenue generated within (ONW) has grown from less than <$1 billion in 1999 to an estimated $2.5 billion in 2008. The 10 current members boarded nearly 330 million people last year, whereas the founding five carried 177 million in 1999. Savings from identifiable joint procurement activities reached $320 million in the first 10 years.
(ONW) member carriers will adopt an alliance livery on a portion of their fleets "as a symbol of their renewed commitment to the alliance," Governing Board Chairman & (AAL) Chairman & CEO, Gerard Arpey announced. The Star Alliance (SAL) runs a similar program. Around 40 airplanes will bear the new livery, which features the (ONW) name and logo on the fuselage against a white or a polished metal background. Each carrier will retain its own standard tail fin design.
To celebrate (ONW)'s 10th anniversary, a special alliance livery was applied onto airplanes in each member airline's fleet. It first appeared on a British Airways (BAB) 747-400 (G-CIVP), Cathay Pacific (CAT)'s A340-300 (B-HXG), followed by a brand new A330-300 in August, and a 777-300ER by December. Royal Jordanian (RJA) presented its special color scheme on a brand new A319-132 delivered in mid February.
(ONW) HAS 673 airport destinations in 134 countries, had 328.63 million passengers in 2008, with 2,226 airplanes.
Robert Antoniuk has rejoined (ONW)'s central alliance team as VP Customer Experience & Airports, succeeding Ken Gilbert who has returned to alliance founder member American Airlines (AAL) after an extended four-year secondment. Robert returns to the (ONW) Management Company after four years with alliance founder member Cathay Pacific (CAT), where he served as Airport Services Manager Vancouver. Reporting to (ONW) Managing Partner, John McCulloch and based at the alliance's Vancouver head office, he will work with the group's member airlines to lead the development and delivery of (ONW)'s customer experience products and proposition as well as overseeing the centralized co-ordination of alliance airport co-location projects. He originally joined (ONW) in 2001, working initially as Manager, Brand Performance & Development and then as Director Customer Experience & Airports.
March 2008: Oneworld (ONW) carriers American Airlines (AAL), British Airways (BAB), Finnair (FIN), Iberia (IBE), and Royal Jordanian (RJA) jointly filed answers to the USA Department of Transportation (DOT)'s request for additional information regarding their transatlantic antitrust application and expressed confidence that a decision will be made by the (DOT) in the second half of 2009.
"Antitrust immunity will benefit the public by allowing (ONW) to compete more effectively against the SkyTeam (STM) and the Star (SAL) alliances, both of which already enjoy broad antitrust immunity (ATI)," the airlines said. In the portions of the heavily redacted filing that were made public, the carriers argued that slots at London Heathrow (LHR) are not overly restricted and that granting (ATI) for (ONW) would still allow competition across the Atlantic. "In fact, there has been so much new capacity added to USA - London routes that it is not at all clear that there is even a current need for more new entry," they wrote.
They noted that "almost any departure slot is a viable time for a North American service" and insisted that a good number are available or held by unaligned carriers. They did concede that arrival slots at (LHR) are more limited owing to the small "window" of suitable timings because "overnight services from North America have to depart before airports close for the night and arrive after (LHR) opens."
Nevertheless, the carriers pointed out, not all slots are being utilized. "Despite campaigning for USA-(EU) "open skies," and having nearly four score of suitable (LHR) slots, bmi (BMA) has still chosen not to launch new USA - (LHR) service a full year after the agreement went into effect," they noted.
April 2009: The European Commission (EC) confirmed that it has opened antitrust investigations against four Star Alliance (SAL) members and three Oneworld (ONW) carriers regarding concerns that their current or planned agreements to coordinate commercial, marketing and operational activities on transatlantic routes might breach European Union (EU) rules. One inquiry relates to the proposed cooperation among American Airlines (AAL), British Airways (BAB) and Iberia (IBE). The other covers the existing transatlantic cooperation between Lufthansa (DLH) and United Airlines (UAL), as well as between (DLH) and Air Canada (ACN), plus the proposed four-party agreement that adds Continental Airlines (CAL), which is slated to join the (SAL) in October (Atlantic Plus-Plus).
The (EC) said the level of cooperation in question appears far more extensive than the general cooperation among the aforementioned airlines and others in their respective alliances. "In particular, the parties to each agreement intend to jointly manage schedules, capacity, pricing and revenue management on transatlantic routes, as well as share revenues and sell tickets on these routes without preference between these carriers," it said, noting it is assessing whether the joint activities "may lead to restrictions of competition on certain transatlantic routes." It added it will take "any demonstrated consumer benefits which may arise from the parties' cooperation" into consideration. The (SAL) and (CAL) won antitrust immunity from the the USA Department of Transportation this month.
Oneworld (ONW) VP Communications, Michael Blunt confirmed that (ONW) anticipated the inquiry into the planned cooperation of (AAL), (BAB) and (IBE). "It is no surprise, he said. "It is the normal European process for addressing any agreement of this kind. It also confirms it is Brussels which [is] investigating the planned cooperation rather than a national competition authority." Last August, the three carriers formally informed the (EC) of their intent to conclude a joint business agreement covering flights between North America and Europe and to apply for (ATI) together with Finnair (FIN) and Royal Jordanian (RJA). The latter two do not appear to be involved in the investigation.
The opening of proceedings does not imply that the (EC) has conclusive proof of an infringement. There is no strict deadline for it to complete inquiries into potentially anti-competitive conduct.
The (EC)'s Directorate General Competition has been reviewing the SkyTeam (STM) alliance for nearly a decade and in 2006 sent a so-called statement of objections to several member carriers after concluding that their cooperation on a number of routes, including some between the (EU) and the USA, would reduce competition. The (STM) carriers offered remedies in October 2007, but the inquiry is ongoing.
Royal Jordanian (RJA) transferred its operations at Frankfurt from Terminal 1 to T2, joining other Oneworld (ONW) member carriers.
American Airlines (AAL) said the USA Department of Transportation issued a scheduling order establishing a six-month timeframe for its decision on the application for antitrust immunity from (AAL) and Oneworld (ONW) partners British Airways (BAB), Iberia (IBE), Finnair (FIN) and Royal Jordanian (RJA). A decision now is expected by November.
May 2009: S7 Airlines (SBR) will join Oneworld (ONW) next year, the 10-member group announced, adding 54 new destinations and eight new countries (Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan) to the alliance's network.
(SBR) will be the second Russian carrier in an alliance. Aeroflot (ARO) joined SkyTeam (STM) three years ago. (SBR)'s first step toward integration will be its June 1 addition to (ONW)'s Global Explorer round-the-world fare. British Airways (BAB) will be its sponsor and adviser during the 18-month alliance implementation program.
(SBR) carried 6 million passengers in 2008 and operates 26 A320 family airplanes, seven A310s and two 767s. It earned a +$3 million net profit in 2008 on revenue of $1.7 billion and is 25% state owned. (ONW) members (BAB), American Airlines (AAL), Iberia (IBE), Japan Airlines (JAL) and Royal Jordanian (RJA) serve (SBR)'s Moscow Domodedovo hub. Mexicana (CMA) is set to join the alliance this year.
"(SBR) fills one of (ONW)'s few remaining membership white spaces with a carrier that matches our alliance's demanding quality requirements. It will expand (ONW)'s presence substantially in Russia and the [CIS]," (ONW) Managing Partner, John McCulloch said. (SBR) CEO, Vladimir Obyedkov said membership "will also strengthen us financially, through revenues from passengers transferring to our network from our (ONW) partners and the cost reduction opportunities the alliance offers."
Meanwhile, in Athens, Star Alliance (SAL) CEO, Jaan Albrecht said he was not bothered by the fact that his group will be the only one of the three global alliances to lack a Russian member. He stressed there is no "rush for Russia" and that the (SAL) talked to (SBR), the defunct AiRUnion alliance and Transaero Airlines (TRX) in the past as part of its strategy to recruit members in Russia, Brazil, India, and China. It has secured commitments from major carriers in the latter three nations. "The Russian airline industry is still very unsettled," he said at the Aegean Airlines (CRM) joining event in Athens. "There are still too many airlines in Russia and it's still a very uncertain environment. Look at what happened to AiRUnion. Two years ago they were the upcoming airline group in the (CIS), but they folded. We have time. We will not rush into announcing a member because others do so."
June 2009: Oneworld (ONW) members American Airlines (AAL), British Airways (BAB), Finnair (FIN), Iberia (IBE), and Royal Jordanian (RJA) expect to receive antitrust immunity (ATI) to cooperate on transatlantic services from the USA and (EU) regulators and (AAL), (BAB) and (IBE) also expect (ATI) for their transatlantic joint venture (JV) within the broader partnership, they told media. "We are very confident the application will be received favorably in the USA and Europe," (BAB) CEO, Willie Walsh said, adding that (AAL), (BAB) and (IBE) have asked the European Commission (EC) to move forward with its so-called "Statement of Objections" to their three-way partnership. The (EC) statement is expected by the end of July and the (JV) "will respond quickly," Walsh said. (AAL) Chairman & CEO, Gerard Arpey shared Walsh's confidence in the final outcome. The USA Department of Transportation has said it will render its decision by late October and the (EU) review is expected to be completed by year end.
The Oneworld (ONW) alliance, which turned 10 this year, is "ramping up its cost reduction activities," Managing Partner, John McCulloch said. It has saved -$310 million over 10 years through joint procurement but aims to do more in what Cathay Pacific Airways (CAT) CEO, Tony Tyler described as "perhaps the most difficult trading conditions any of us can remember." He said (CAT) has been particularly hard hit by fears among Asian travelers of the H1N1 virus. Arpey said the swine flu scare has devastated the carrier's traffic to Mexico. With the addition of Mexicana (CMA) later this year and Russia's S7 Airlines (SBR) in 2010, (ONW) largely will be complete, Arpey said. (ONW) sees little opportunity for further expansion without diluting the revenue and traffic base of existing members. It said interline revenue rose +10% in 2008 to $2.4 billion as 8 million passengers transferred between members' flights. Turnover from alliance fares and sales activity increased +25% to $850 million. (ONW) said members lost a combined -$1.7 billion last year.
September 2009: British Airways (BAB) said that it has gotten involved in American Airlines (AAL)'s talks with Japan Airlines (JAL) as part of an effort to keep (JAL) in the Oneworld (ONW) fold, while Japan's new government indicated it may not be fully supportive of the carrier's restructuring plan. (JAL) confirmed that it was in talks with both American Airlines (AAL) and Delta Air Lines (DAL) regarding one of those carriers potentially taking a stake, and said it hoped to reach accord on a tie-up by mid-October. (BAB) confirmed to "The Wall Street Journal" that it also is engaged in talks with (JAL), which a spokesperson said is "valuable to us as part of (ONW)." The paper reported that other (ONW) carriers are involved in talks about possible further cooperation, driven by fear that a (JAL)/(DAL) deal could lead it to jump to the SkyTeam (STM) alliance, which lacks a Japanese affiliate.
Meanwhile, (JAL)'s restructuring plan may have to be revised in the wake of the Democratic Party of Japan (DPJ)'s decisive defeat of the long-entrenched Liberal Democratic Party (LDP) in national elections. The new government is reviewing (LDP) policies and financial help for (JAL) appears to be part of the examination.
While (JAL) is a private carrier, it has been receiving loans from the Development Bank of Japan to mitigate its steep losses, including a ¥99 billion/$1.09 billion deficit for its fiscal first quarter ended June 30. The former government established a panel to which (JAL) is required to report regarding its restructuring as a condition for receiving the aid and the panel signaled support for a planned -14% workforce reduction.
But Seiji Maehara, in his first press conference as Transport Minister, said that the (DPJ) government "would like to go back to the drawing board" on the (JAL) oversight panel. "I would like to hear advice from a variety of viewpoints regarding Japan's aviation policy," he told reporters, adding that he wants to "take a thorough look at whether the plan to restructure (JAL) can realistically be implemented."
(JAL) reportedly is planning to seek an additional ¥100 billion in government-backed loans in coming months. (DPJ) swept to victory in part by promising voters to be less business-friendly and more consumer/worker-oriented, leading to speculation that it may be wary of (JAL)'s planned job cuts.
Mexicana (CMA) and its MexicanaClick (AEB) and MexicanaLink subsidiaries officially will become part of Oneworld (ONW) on November 10, the alliance announced. Mexicana (CMA)'s network spans 67 destinations in 14 countries (including 37 in Mexico). Addition of the mainline and the two subsidiaries, which will join as affiliate members, will add 26 destinations to the Oneworld (ONW) map - - 24 in Mexico along with Oakland and Edmonton. (ONW) airlines currently serve 13 Mexican destinations. Iberia (IBE) has sponsored (CMA) during its membership process. (CMA) operates 26 A320s, 21 A319s, 10 A318s, two A330s, two 767-200s and two 767-300s. MexicanaClick (AEB) operates 24 F 100s and six 717s, while MexicanaLink flies 12 CRJ-200s. (ONW) said S7 Airlines (SBR) is "on track" to join next year.
October 2009: Oneworld (ONW) airlines operating to/from London Heathrow will be concentrated in Terminal 3 and Terminal 5, finalizing the (ONW) alliance's biggest co-location project to date. T3 is the closest existing terminal to T5. T3 is nearing completion of an upgrade designed to bring customer facilities up to a similar standard to those offered at T5. The eight (ONW) carriers operated from five different terminals in the past.
The European Commission (EC) confirmed that it sent a "statement of objections" to American Airlines (AAL), British Airways (BAB) and Iberia (IBE) in September, warning the carriers that their proposed cooperation on transatlantic services "may be in breach of European rules on restrictive business practices." The (EC) in April opened an antitrust inquiry into the proposal, which would see the Oneworld (ONW) partners deepen their cooperation across the Atlantic by coordinating commercial, operational and marketing activities, in particular by jointly managing schedules, capacity and pricing as well as sharing revenue on transatlantic routes. The (EC)'s specific objections were not made public. It emphasized that issuance of the document to the carriers "is a formal step in Commission antitrust investigations" that does "not prejudge the final outcome." The carriers can respond in writing or request an oral hearing.
"We have received the (EU)'s statement of objections and look forward to the opportunity to address and overcome the (EU)'s concerns, especially given the substantial benefits for consumers," (BAB) said in a statement. "The (EU)'s thorough review of our plans and supporting evidence was anticipated."
Virgin Atlantic Airways (VAA), a vocal critic of the proposed transatlantic pact, "welcomed" the (EC)'s issuance of objections, stating, "(VAA) would expect the (EC) to find that the proposed alliance would damage competition and consumer interests on all six of the routes from [London] Heathrow to the USA on which (BAB) and (AAL) both operate currently. These include Heathrow to New York (JFK) on which (BAB) and (AAL) together would control 62% of all capacity and would have an unassailable grip on time-sensitive premium passengers."
The European Commission (EC) will require Oneworld (ONW) partners British Airways (BAB), American Airlines (AAL) and Iberia (IBE) to surrender slots in order to gain clearance for their transatlantic alliance, the "Financial Times (FT)" reported, citing documents saying the joint venture is "likely to result in appreciable competitive harm" on seven Europe - USA routes. European authorities reportedly are concerned about competition on flights from London to New York, Dallas, Boston, Miami, and Chicago O'Hare (ORD), as well as from Madrid to both Miami and (ORD). The (EC)'s concerns were outlined in a confidential statement sent to the airlines three weeks ago. It said it "envisages issuing a decision finding that the series of agreements signed have been in breach" of competition laws and that "remedies may include . . . the transfer of airport slots" to competing carriers, the (FT) reported from Madrid.
The airlines had one month to respond to the (EC) notice. (BAB) CEO, Willie Walsh has vowed on several occasions that the carrier will not relinquish any slots at London Heathrow. The trio, along with (ONW) alliance partners, Royal Jordanian (RJA) and Finnair (FIN), also are seeking antitrust immunity from the USA Department of Transportation (DOT).
The (FT) reported that (IBE) said the airlines were "satisfied that they could address the concern of the [EC]," while (AAl) said, "We look forward to the opportunity to address and overcome the European Union (EU)'s concerns." In a statement to "Bloomberg News," (BAB) said, "On the issue of giving up slots at Heathrow, we don't believe that this is necessary given the number of airlines flying between the (EU) and (USA)."
November 2009: Mexicana (CMA) and its affiliates officially became the Oneworld (ONW) alliance's 11th member, adding 24 Mexican destinations, Edmonton and Oakland to the (ONW) alliance's map.
Iberia (IBE) Chairman & CEO, Antonio Vazquez, whose airline sponsored (CMA)'s entry, said the (ONW) alliance's newest member "will considerably strengthen (ONW)'s long-established position as the leading airline alliance in the Spanish-speaking world and in Latin America." (LAN) Airlines is the (ONW) alliance's other Latin American member.
All alliance benefits and services are available to (CMA) passengers on the mainline and MexicanaClick (AEB) and MexicanaLink subsidiaries. (CMA) serves 67 destinations in 14 countries. Other (ONW) members currently serve 13 Mexican airports.
"Work is well advanced in linking up Mexicana (CMA)'s Information Technology (IT) systems to those of (ONW)'s established members. This has been eased by (CMA) switching its main platform earlier this year to Amadeus Altea, which is already used by seven other (ONW) airlines," (CMA) said.
The (CMA) mainline operates 26 A320s, 21 A319s, 10 A318s, two A330s, two 767-200s and two 767-300s. MexicanaClick (AEB) flies 24 F 100s and six 717s, while MexicanaLink uses 12 CRJ-200s.
(ONW) said its global network now comprises nearly 750 airports in close to 150 countries, with airlines operating almost 2,500 airplanes on some 8,500 daily flights.
S7 Airlines (SBR) dismissed rumors that surface regularly in the Russian media that it will be absorbed by Aeroflot (ARO) and confirmed that it is on track to join the Oneworld (ONW) alliance in November 2010. "I'm sure (ARO) would like to acquire us and our network, but we are not for sale," Credit Risk & Alliance Manager, Ilya Alexandrovskiy stressed at the Mexicana (CMA) Oneworld (ONW) joining event in Mexico City. (SBR), which was technically bankrupt in February but since has restructured its debt, is "operational in excellent shape," Alexandrovskiy added. "The decision last winter to ground our Tupolev and Ilyushin fleet and operate only Western-built airplanes allowed us to be profitable," he noted, stating that S7 (SBR) was profitable for the nine-month period ended September 30. Traffic in the first nine months fell -15% to -20% "in line with the Russian market." Implementation of Oneworld (ONW) joining requirements is progressing "well," he said. "We are on track to formally join in November next year."
(AAL) Chairman & CEO, Gerard Arpey reiterated that he sees no need to relinquish slots at London Heathrow (LHR) in order to address possible competition concerns over (AAL)'s planned transatlantic joint venture with British Airways (BAB) and Iberia (IBE). The European Commission (EC) reportedly sent a confidential statement to the participating Oneworld (ONW) airlines last month outlining its concerns about competition on routes from (LHR) to New York, Dallas, Boston, Miami and Chicago O'Hare (ORD), as well as from Madrid to both Miami and (ORD). "Based on facts, I do not think any remedy [to gain clearance from (EU) authorities is necessary. The slot holding of (BAB) and (AAL) at (LHR) is less than the other guys at Frankfurt [Star Alliance (SAL) carriers] or Paris [SkyTeam (STM) carriers]," Arpey said at the Oneworld (ONW) ceremony in Mexico City, where the alliance welcomed Mexicana (CMA). "All carriers have access to (LHR) and have been able to buy slots. The London - USA market is currently the most contested market in the world."
He noted that the trio has been working "hard" to secure required approvals on both sides of the Atlantic. "We hope and expect those approvals will be forthcoming in the near future . . . All we are seeking is a level playing field." They are more concerned about the fate of their antitrust immunity (ATI) application with the USA Department of Transportation (DOT) than with earning (EC) clearance, pointing out that the (EC) also is reviewing the (SAL) and (STM) alliances. The (DOT) was expected to decide on the Oneworld (ONW) application on October 31. It already has granted immunity to the "Atlantic Plus Plus" joint venture among Air Canada (ACN), Lufthansa (DLH), United Airlines (UAL) and Continental Airlines (CAL) and to the tie-up between Air France (AFA)/(KLM) and Delta Air Lines (DAL).
(DAL) revealed that it has made a comprehensive offer to Japan Airlines (JAL)/(JAS) to switch from the Oneworld (ONW) alliance to the SkyTeam (STM) alliance that includes financial assistance and guarantees totaling $1 billion, saying it wants (JAL)/(JAS) to be "the face of Asia" for (DAL). Struggling (JAL)/(JAS) is attempting to enter into a government-backed restructuring that would allow it to avoid bankruptcy, but no plan has been agreed to and Japanese Transport Minister, Seiji Maehara said that a court-administered bankruptcy is a possibility. He said his past assurances regarding (JAL)/(JAS) were not meant to rule out bankruptcy but to communicate that the government would make sure that (JAL)/(JAS) would not "collapse or disappear."
(DAL) President, Edward Bastian told reporters in Tokyo that (DAL) and other SkyTeam (STM) alliance partners are willing to provide a $500 million equity injection as well as an additional +$200 million in asset-backed financing. It also would guarantee the $300 million in annual revenue that (JAL)/(JAS) claims it now generates owing to its membership in the (OMW) alliance. (DAL) reiterated that it would cover the Information Technology (IT) costs of making an alliance switch, estimated to be about $15 to $20 million.
Bastian asserted that "The SkyTeam (STM) alliance is by far the strongest partner for (JAL)/(JAS) and the best ally to ensure (JAL)/(JAS)'s growth and stability." The SkyTeam (STM) alliance currently does not have a Japanese affiliate but has an Asia/Pacific presence with Korean Air (KAL) and China Southern Airlines (GUN). Bastian said the Tokyo-based carrier "for (DAL) would represent in many ways the face of Asia." He claimed (JAL)/(JAS)'s annual revenue would be boosted by around +$400 million through access to (STM) passengers. In a USA regulatory filing, (DAL) said it has "discussed a possible marketing alliance and joint venture with (JAL)/(JAS) covering routes between North America and Asia, including a related capital investment in (JAL)/(JAS) by us and one or more other [STM] members." Bastian told reporters that a (JAL)/(JAS) alliance switch could be achieved in less than a year. He added that the (DAL)/(STM) offer is "unconditional" and does not depend on how much financial assistance (JAL)/(JAS) receives from the Japanese government.
American Airlines (AAL) has indicated that it will put up a strong fight to keep (JAL)/(JAS) in the (ONW) alliance, including challenging a move to the (STM) on antitrust grounds owing to (DAL) subsidiary, Northwest Airlines (NWA)'s strong presence in Japan. (AAL) reportedly has teamed with TPG Capital to propose investing $300 million in (JAL)/(JAS).
The Oneworld (ONW) alliance is looking to increase further its footprint in Latin America, particularly in Brazil, where Gol (GOT) is among the potential membership candidates with which it is in discussions. "Brazil is an important market for us, and Gol (GOT) is obviously a significant player. (GOT) has made great strides in the past two years and, like in India and China, we keep channels open to everyone to review continually our options and their strategy," (ONW) Managing Partner, John McCulloch said. He did not confirm the talks with (GOT), but discussions are "in an early stage" and that no announcement is imminent. (GOT) recently signed extensive bilaterals with (ONW) members American Airlines (AAL) and Iberia (IBE). (LAN) Airlines is (ONW)'s other Latin American member. Brazilian flag carrier TAM (TPR) committed to the Star Alliance (SAL) last year, and SkyTeam (STM) Chairman, Leo van Wijk confirmed in June that his alliance has talked with Gol (GOT) as well.
December 2009: Multinational corporations can now complete their Oneworld (ONW) sales contracts electronically. The agreements, through which (ONW) alliance members jointly offer special prices and perks to large corporate clients, previously required ink signatures by representatives of the company and members of each airline in the (ONW) alliance. The first firm to use the new service is Rio Tinto, an Australian mining giant which unsurprisingly does business with the (ONW) alliance because Qantas (QAN) is a member.
American Airlines (AAL) is partnering with Texas Pacific Group (TPG) Capital to offer to invest $1.1 billion in Japan Airlines (JAL)/(JAS) to assist with (JAL)/(JAS)'s restructuring and ensure it remains in the Oneworld (ONW) alliance fold.
(AAL) CFO & Executive VP Finance & Planning Tom Horton insisted that the (AAL)/(TPG) proposal is "far superior" to the $1 billion package Delta Air Lines (DAL) offered (JAL)/(JAS) to induce it to switch to the SkyTeam (STM) alliance. He added that the value of the (AAL)/(TPG) deal could increase by as much as $700 million over 10 years "if (JAL)/(JAS) builds its links" with (AAL). He stated, "The total incremental financial support from the (AAL), (ONW) and (TPG) proposal is in excess of >$1.8 billion and far exceeds any other available proposition."
He further claimed that (ONW) "provides (JAL)/(JAS) with roughly $500 million in annual revenue" and claimed that (JAL)/(JAS) would lose $500 million in the first two years following a switch to the (STM).
However, Horton declined to detail the financial structure of the proposed offer or the share each of the partners would contribute, though he did say (AAL)'s contribution would be substantial. He also reiterated (AAL)'s claim that a (DAL)/(JAL)/(JAS) tie-up would pose antitrust concerns owing to (DAL) subsidiary, Northwest Airlines (NWA)'s strong position at Tokyo Narita. Horton said that currently, the three major alliances each have about a third of the USA - Japan market. However, with (JAL)/(JAS) in (STM) "that balance is shattered. (STM)'s share will jump to 62% and (SKT) and the Star (SAL) alliance will have a duopoly with 93% of the market, an anti-competitive result that the USA government simply will not allow."
Former USA Transportation Secretary, Norman Mineta is acting as a consultant to (AAL) on its (JAL)/(JAS) bid and joined Horton for the briefing in Tokyo. "There is no precedent for the Department of Transportation (DOT) to immunize two airlines that operate connecting hubs in the same market, which is the case with Delta (DAL) - (NWA) and (JAL)/(JAS)," Mineta said. (DAL) President, Ed Bastian told reporters he is confident that a (DAL)/(STM) investment in (JAL)/(JAS) would be cleared by antitrust regulators.
Horton stated that (AAL) would apply to form an antitrust-immunized transpacific joint venture with (JAL)/(JAS), which he said will be permissible under the USA - Japan "open skies" accord expected to be finalized imminently. Additionally, (ONW) members, British Airways (BAB) and Finnair (FIN) said they would code share "far more widely" with (JAL)/(JAS), while (LAN) Airlines and Mexicana (CMA) also pledged greater cooperation to increase (JAL)/(JAS)'s access to Latin America.
(JAL)/(JAS) President, Haruka Nishimatsu has said he would like to choose between the (AAL) and (DAL) offers by year end. (JAL)/(JAS) is attempting to enter into a government-backed restructuring and last week secured an emergency loan from the Development Bank of Japan.
January 2010: American Airlines (AAL) confirmed that its offer to invest in (JAL)/(JAS) in conjunction with TPG Capital has been raised by +$300 million to $1.4 billion and said it and Oneworld (ONW) partner British Airways (BAB) will enhance cooperation with (JAL)/(JAS) to enable it to generate an additional +$500 million in revenue over the next three years. (AAL) has been jockeying with Delta Air Lines (DAL) to take a stake in (JAL)/(JAS), which appears to be on the verge of entering a court-monitored bankruptcy proceeding. However, reports from Tokyo indicate that (ETIC) favors rejecting foreign investment in the carrier and instead will push it toward noncapital commercial cooperation with either (AAL) or (DAL), which is attempting to lure (JAL)/(JAS) to SkyTeam (STM).
(AAL) Executive VP Finance & Planning plus CFO, Tom Horton, speaking at a Tokyo news conference, said (ONW) has an "extraordinary commitment" to (JAL)/(JAS), which he claimed already generates around $500 million annually from its association with the (ONW) alliance. Enhanced cooperation with (ONW) partners can generate an additional $500 million over three years, he asserted. He said the incremental revenue would come primarily from closer ties with (AAL) and (BAB). An antitrust-immunized transpacific joint venture between (JAL)/(JAS) and (AAL) will "conservatively" generate an extra +$300 million over three years, he stated, adding that (AAL) "will guarantee this $100 million in new annual revenue for the first three years of the venture . . . to remove uncertainty."
In addition, (BAB) "has proposed a series of enhancements to its business relationships with (JAL)/(JAS) that will result in approximately $200 million in revenue over three years," Horton said. (BAB) Director Investments, Roger Maynard said (BAB) will "facilitate any decision by (JAL)/(JAS) to start services from [Tokyo] Haneda to London Heathrow (LHR)" by providing (JAL)/(JAS) with (LHR) "infrastructure . . . and slots" necessary for such services. He added that (BAB) would "double the number of European cities that (JAL) can reach through code sharing" on (BAB) flights from April.
Horton said (ONW) partners Qantas (QAN) and Cathay Pacific Airways (CAT) are willing to assist (JAL)/(JAS) with its "complicated restructuring" by providing "expertise," including (QAN) helping (JAL) launch a Low Cost Carrier (LCC) affiliate based on its JetStar Airways (IMU) model. (CAT) General Manager Japan, Simon Large noted that (ONW) is willing to guarantee that "(JAL)/(JAS) is the exclusive north Asia partner in this alliance."
(JAL)/(JAS) executives and the Japanese government have been circumspect about discussing details of the airline's restructuring publicly, but Japanese Transport Minister, Seiji Maehara did say that (JAL)/(JAS)'s largest creditors are on board with the airline's recovery plan, though he did not confirm details of the plan.
February 2010: The European Commission (EC) confirmed that it is assessing "the effectiveness of proposed commitments" received from Oneworld (ONW) alliance partners: British Airways (BAB), American Airlines (AAL) and Iberia (IBE) designed "to alleviate" its concerns over anti-competitive aspects of their proposed joint venture (JV).
The airlines wish to jointly manage schedules, capacity and pricing and share revenue on transatlantic routes. The remedies proposed by the trio relate to passenger transport on certain long-haul routes, the (EC) said, noting that it has "no further comment at this stage" and that the offer requires further investigation before it "reaches any conclusion as to the next steps." The (EC) opened its investigation last April and sent a formal statement of objections to the carriers in September, identifying a number of long-haul routes, mainly between London Heathrow (LHR) and the USA, with potential antitrust issues (ATI). (BAB) CEO, Willie Walsh and (AAL) Chairman & CEO, Gerard Arpey repeatedly have stated that there is no rational basis for them to relinquish slots at (LHR).
Sources told "Dow Jones" that the carriers had reconsidered and were in discussions to that effect. A (BAB) spokesperson told the news service, "We don't see any need to give up slots." The (EC) is conducting parallel investigations into the proposed cooperation among four Star (SAL) Alliance members: - - Lufthansa (DLH), Continental Airlines (CAL), United Airlines (UAL) and Air Canada (ACN) - - and among SkyTeam (STM) alliance members. The USA Department of Transportation also must sign off on the (ONW) (JV).
Months of high-stakes jockeying between the Oneworld (ONW) alliance's American Airlines (AAL) and the SkyTeam (STM) alliance's Delta Air Lines (DAL) over partnering with troubled Japan Airlines (JAL)/(JAS) came to an end when (JAL)/(JAS) announced it will stay in the (ONW) alliance and jointly apply for antitrust immunity (ATI) on transpacific routes with (AAL).
(JAL)/(JAS) President & COO, Masaru Onishi said (JAL)/(JAS), which last month entered into a court-monitored bankruptcy restructuring, had "analyzed this issue in great detail" and reached the conclusion that "the advantages of this development with (AAL) can strongly support (JAL)/(JAS) at a time when we are striving towards the revival of our business."
(JAL)/(JAS) Senior VP Corporate Planning, Daiji Nagai told reporters that the near-term stability gained from sticking with the (ONW) alliance outweighed the potential long-term benefits of jumping to the (STM) alliance, a move that would have given that alliance a dominant hold on the USA-Japan market. "We had a fierce debate over whether we should choose (DALO) and the (STM) alliance for future profitability or stay in the (ONW) alliance and avoid incurring a loss from making a switch this year," he explained. "If we don't survive the first two years, there will be no future for (JAL) after the third year of restructuring. We decided that we can minimize risk by staying with American (AAL)."
(JAL)/(JAS) said that upon receiving approval from the the USA Department of Transportation and the Japanese Ministry of Land Infrastructure, Transport and Tourism, it intends to enter into "a joint business venture (JV) [with (AA)] which will enhance [the two carriers'] scope of cooperation on the routes between the USA and Japan through adjustments to their respective networks, flight schedules and other business activities."
(ATI) approvals for (AAL)/(JAL)/(JAS) and for a similar (JV) between United Airlines (UAL)/Continental Airlines (CAL) and (ANA) are prerequisites for enactment of the Japan/USA "open skies" accord tentatively agreed to in December. It appears that (AAL) will not take a stake in (JAL)/(JAS) through a capital investment as previously had been considered. "We respect that this was an important decision for (JAL)/(JAS) . . . and we believe they have made the right choice for (JAL)/(JAS)'s many stakeholders, for Japan's national interests and for consumers travelling between Japan and the United States," said (AAL) Chairman & CEO, Gerard Arpey, who had vowed to "move aggressively to block" a (JAL)/(JAS) attempt to partner with (DAL). He added that (AAL) "remains confident" (ATI) will be cleared.
"The members of the (STM) alliance respect the decision made by (AL)/(JAS)," the (STM) alliance said in a statement. "We believe that cooperation with (JAL)/(JAS) would have brought good opportunities to all parties involved."
Later, the USA Department of Transportation (DOT) issued a show cause order tentatively approving the application for antitrust immunity (ATI) from Oneworld (ONW) alliance partners (AAL), British Airways (BAB), Iberia (IBE), Finnair (FIN) and Royal Jordanian (RJA) and also tentatively approved the three-way transatlantic joint venture (JV) among (AAL), (BAB) and (IBE) under which the carriers jointly will plan and manage capacity and share revenues.
But the (DOT) said the (ONW) alliance "could harm competition" on certain routes between the USA and London Heathrow (LHR) and is requiring that the carriers surrender four slot pairs at (LHR) for up to 10 years to enable competitors to launch new USA - (LHR) service. (AAL) and (BAB) had argued that they should not have to give up slots at (LHR). They withdrew an earlier application in 2002 for (ATI) rather than surrender slots at Heathrow. The European Commission (EC) also has identified competitive concerns but has yet to render a decision.
The (DOT)'s ruling came less than a day after Japan Airlines (JAL)/(JAS) and (AAL) applied for (ATI) to operate as one airline for commercial purposes on transpacific routes.
In its finding, the (DOT) said that "the proposed [transatlantic] alliance would enhance competition around the globe by creating a viable third immunized alliance that is comparable and more competitive with the product and service offerings of the Star (SAL) alliance and SkyTeam (STM) alliance, which have already received grants of antitrust immunity (ATI) and are proceeding with their own alliance plans and integrated joint ventures (JV)s."
However, the department noted that granting (ATI) to (AAL) and (BAB) will have the effect of boosting the combined carriers' market share at (LHR) to 47.4% and is proposing to require divestiture of four slot pairs, two of which will be earmarked for new service in the Boston - (LHR) market, while two may be used in any USA - (LHR) city-pair. It added, "This slot remedy would offset the potential loss in competition that results from combining the international operations" of (AAL) and (BAB).
The slot surrenders need not be permanent - - the (DOT) is "proposing that the applicants make the slots available for a period of 10 years from the date of issuance of a final order in this case." It also will require changes to the agreement "to ensure capacity growth, and require the carriers to submit traffic data and implement the proposed alliance within 18 months of a final decision."
In a statement, (AAL) said it "will review the (DOT)'s tentative order and will respond according to the time frame established for comments."
The tentative finding came less than 24 hours after (AAL) and Japan Airlines (JAL)/(JAS) applied for (ATI) to operate as if they are one airline for commercial purposes on flights between North America and Asia. The filing, which had been expected, followed (JAL)/(JAS)'s decision last week to maintain its membership in Oneworld (ONW) rather than jumping to SkyTeam (STM), which had been wooing the bankrupt carrier for several months. (JAL)/(JAS) and (AAL) said they also will notify Japan's Ministry of Land, Infrastructure, Transport and Tourism of the application. Should (AAL) and (JAL)/(JAS) receive (ATI), they will "cooperate commercially on flights while continuing to operate as separate legal entities . . . coordinat[ing] fares, services and schedules in order to attract new customers and boost revenues." They noted that the (JBA) will be "metal neutral," meaning both "will benefit from a customer's ticket purchase regardless of which one carries the passenger, as the airlines will share revenue on all (JBA) flights."
Buoyed by Japan Airlines (JAL)/(JAS)'s decision to maintain its membership in the Oneworld (ONW) alliance and the USA Department of Transportation's tentative approval of transatlantic antitrust immunity (ATI), the (ONW) announced that its Asian presence will be expanded further with the 2011 addition of India's Kingfisher Airlines (KFH).
(KFH) officially applied to India's Ministry of Civil Aviation for permission to join the group, and an official target date will be announced once that regulatory procedure is complete. The (ONW) alliance set 2011 as a preliminary goal. (KFH) will become the (ONW)'s 13th member and is sponsored by British Airways (BAB). Russia's S7 Airlines (SBR) is set to join this year. "Becoming part of the (ONW) alliance would be one of our most significant steps so far and is right in line with our vision to become one of the world's top airlines," (KFH) Chairman & CEO, Vijay Mallya said.
(BAB) CEO, Willie Walsh called (KFH) "an ideal fit" for the group and fired a volley at rival Star (SAL) Alliance by claiming that "the (ONW) alliance's priority is the quality, rather than the quantity, of our member airlines." The (SAL) alliance currently has 26 members with four more, including Air India (AIN), preparing to join.
(KFH) will add 58 destinations to the (ONW) alliance map, all in India, expanding the group's combined network to 800 airports in nearly 150 countries. (ONW) alliance carriers currently serve Bangalore, Chennai, Delhi, Hyderabad, and Mumbai.
(KFH) began flying internationally in September 2008 and operates to (ONW) hubs at London Heathrow, Bangkok, Hong Kong, and Singapore, in addition to Colombo, Dubai, and Dhaka. (KFH) serves a total of 63 Indian and seven international destinations with a fleet of five A330s, eight A321s, 23 A320s, three A319s, 25 ATR72-500s and two ATR42-500s and has five A380s and five A350s on order. In the nine months to December 31, 2009, (KFH) reported a loss of -INR10.75 billion/-$232.8 million.
March 2010: Oneworld (ONW) alliance partners British Airways (BAB), American Airlines (AAL) and Iberia (IBE) offered to lease at least four daily slot pairs at London Heathrow (LHR) or Gatwick (LGW) to competing carriers for service to three USA cities in order to address regulatory concerns about their proposed transatlantic joint venture (JV).
Early last month the European Commission (EC) said it was assessing "the effectiveness of proposed commitments" by the airlines designed to address a formal Statement of Objections issued last September. At that time, the (EC) identified a number of long-haul routes, mainly between (LHR) and the USA, with potential antitrust issues (ATI).
Later in February the USA Department of Transportation (DOT) tentatively granted antitrust immunity (ATI) to the (ONW) alliance joint venture (JV) under the condition that the carriers surrender four slot pairs at (LHR) for up to 10 years. The (DOT) did not suggest (LGW) was an acceptable alternative. (AAL) and (BAB) repeatedly have resisted ceding slots at (LHR).
(BAB) issued a statement addressing the (EC) investigation and pledged that the trio will make available for lease to non-(ONW) alliance airlines, two daily slot pairs to Boston from either (LHR) or (LGW), one daily slot pair to Dallas/Fort Worth from (LHR) or (LGW) and one daily slot pair to Miami from (LHR) or (LGW). In addition, two slot pairs from London to New York (JFK) could be made available "should today's competitive conditions between [the cities] change," according to (BAB).
"The slots can be leased from the airlines' current slot portfolio and don't have to be slots currently used on the specified routes. The (EC) has agreed that the airlines should be compensated financially by those airlines wishing to lease slots," (BAB) said.
"We're pleased that the (EC) has recognized that we should be compensated for leasing the slots. This reflects the fact that there is an active slots market in London where slots are generally traded for value," (BAB) CEO, Willie Walsh said. There had been speculation that the (EC) might demand the slots be surrendered for free. The initial leasing period will be five years, a (BAB) spokesperson said, adding that the decision regarding which airline will give up which slot will be finalized once regulatory approval is finalized.
The (EC) is expected to conduct its "market test" phase, which allows third parties to comment on the airlines' proposal, before making a final decision on April 10.
Regarding the USA (DOT) ruling, the (ONW) trio reiterated that it is "reviewing the order and will respond by the time frame established for comments," and said it "welcomed the (EU)'s announcement that it will be working closely with the USA (DOT) and taking into account its opinion at key points in the regulatory process." A final (DOT) ruling is expected at the end of April.
July 2010: The USA Department of Transportation (DOT) issued its final clearance of antitrust immunity (ATI) for American Airlines (AAL), British Airways (BAB), Iberia (IBE), Finnair (FIN) and Royal Jordanian (RJA) to "more closely coordinate international services" including a planned (AAL)/(BAB)/(IBE) joint venture (JV) on transatlantic flights.
The granting of (ATI) follows on the heels of the European Commission (EC)'s approval and cements the (DOT)'s tentative approval earlier this year.
"The department found that granting (ATI) to the Oneworld (ONW) alliance will provide travelers and shippers with a variety of benefits, including lower fares in some markets, new nonstop routes, improved services and better schedules," the (DOT) said. "The (DOT) also said that the (ONW) alliance will enhance competition around the world by enabling the (ONW) alliance to compete more vigorously with Star (SAL) Alliance and SkyTeam (STM) Alliance, which operate similar immunized alliances." The (DOT) said that to alleviate any anti-competitive concerns the carriers had agreed "to make four pairs of slots at [London] Heathrow available to competitors for new USA - London service, with two pairs to be used for Boston - London service and the other two for service from any other USA cities."
(AAL) Chairman & CEO, Gerard Arpey said, "We are pleased that USA and (EU) regulators have approved our long-sought-after alliance proposal. We look forward to delivering enhanced competition for customers on transatlantic flights."
British Airways (BAB) CEO, Willie Walsh added, "This final approval is fantastic news for [(AAL)/(BAB)/(IBE)] and the Oneworld (ONW) alliance. We've waited 14 years to bring the benefits of the transatlantic joint business to our customers and level the playing field with the other two global alliances. We're pleased that the (DOT) and the (EU) have worked together to ensure that there is consistency in the number of slots that the three airlines have to give up for our competitors to use on services from Heathrow to the USA."
Air Berlin (BER) said it will join the Oneworld (ONW) alliance and develop cooperative agreements with several members of the alliance.
In line with German stock exchange regulations, it said that it has reached an agreement with (ONW) on “key aspects” of its membership and that it will work toward completing a full membership agreement under the sponsorship of British Airways (BAB). It added that “membership in (ONW) would strengthen Air Berlin (BER)’s competitive position and enable it to participate in the (ONW) alliance’s revenue enhancement and cost reduction activities.”
(BER) also said it entered into code share agreements with American Airlines (AAL) and Finnair (FIN) that are scheduled to take effect November 1. Responding to the (BER) statement, (AAL) said it "welcomes the news that Air Berlin (BER) has accepted an invitation to join the Oneworld (ONW) alliance and is delighted to be one of the first members of the alliance to announce a bilateral agreement with what is Germany’s second largest airline." The (AAL) accord will give (BER) passengers access to 15 destinations in the USA and two in the Bahamas. The Finnair (FIN) cooperation will apply to code share flights to Helsinki, within Europe and to Asia. The agreements are subject to regulatory approvals.
The (ONW) alliance is expected to officially invite (BER) to become a member. (BER) is Germany’s second largest after Lufthansa (DLH). In recent years, it has grown both organically and through acquisitions.
The Air Berlin Group includes Air Berlin (BER), the Austrian airline NIKI (NKI) (in which (BER) holds a 49.9% stake), the Swiss airline Belair (BLB) (49%) and the Dusseldorf-based airline (LTU) (100%). At the end of the first quarter, the group operated 150 airplanes with an average age of 5.3 years. It carried 27.9 million passengers last year.
(BER) is attempting to position itself between traditional mainline carriers and Low Cost Carrier (LCC)s, although several industry observers see it more as a hybrid between a charter carrier and an (LCC). Its membership in the Oneworld (ONW) alliance would mark the first time such a crossover carrier has joined a global alliance.
August 2010: Frankfurt airport operator Fraport is urging Air Berlin (BER) to build a hub-and-spoke system at Germany’s largest airport.
“There are strong potential benefits from a Oneworld (ONW) hub in Frankfurt, not only for the airlines, but also for us,” CFO, Matthias Zieschang said. Air Berlin (BER) recently announced its intention to join the Oneworld (ONW) alliance in 2012. (BER) only has a limited presence in Frankfurt, mainly because of slot constraints. Also, Frankfurt is the hub for rival Lufthansa (DLH). Fraport’s plans to support a (BER) expansion will almost certainly be met with resistance by (DLH), which has a stake of around 10% in Fraport and
is represented on the board of directors.
Zieschang argues that “(BER) would form a good link to the Oneworld (ONW) alliance by taking over a feeder function” in Frankfurt and believes that this is not nearly as viable in Berlin where a new airport will open next year. Berlin does not have a significant long-haul network, however. While it will be difficult for (BER) to add any new services in Frankfurt in the near term, it could re-designate existing slots to business destinations that are currently used for leisure services that are unattractive as
feeder routes. Also, Frankfurt Airport opens its fourth runway in 2012, raising capacity from 83 movements per hour to 120. Linking up with Oneworld (ONW) carriers such as (LAN), American Airlines (AAL), Iberia (IBE), Cathay Pacific (CAT) and British Airways (BAB) could form a strong network, but it would be smaller than (DLH)’s offering on the same airport. Fraport also plans to build a third terminal once the current two buildings are full. Oneworld (ONW) members currently use Terminal 2, but they could move over to Terminal 3 which is likely to be bigger. An exact opening time is not yet confirmed.
(BER) said it was encouraged by the comments, and stated that the fourth Frankfurt runway will open new opportunities.
The prospective (LAN) Airlines/TAM (TPR) merger, if it is cleared by both companys' shareholders and relevant regulators, will create a new airline company that aims to be the dominant operator in Latin America and a formidable presence on the world stage, with a major battle over alliance membership likely on tap.
The all-stock transaction, which the airlines aim to complete in the first half of next year, is valued at $3.7 billion and would create a parent company, the LATAM Airlines Group, with combined annual revenue of $8.5 billion. Executives made clear that the intent of the merger is to build a platform for future growth.
"Together, (LAN) and TAM (TPR) will be able to offer new destinations that neither company could have supported on its own," (TPR) CEO, Marco Bologna said. "This will position us to compete with the many foreign carriers that continue to increase service to our region."
(LAN) already operates affiliate carriers in Peru, Argentina, and Ecuador, and in May announced that start-up Colombian carrier "Aeroasis" will become part of the (LAN) group of airlines, all of which will come under the LATAM umbrella. (LAN) CFO, Alejandro de la Fuente said the networks of (LAN) and (TPR) "are highly complementary with little overlap." He added that in addition to a passenger network spanning 115 destinations in 23 countries, LATAM will offer "the most comprehensive cargo network in Latin America."
The airlines said LATAM will provide "seamless passenger and cargo services across the continent and around the world," but executives did not say in which airline alliance (LAN)/(Tpr) would be a member. (LAN) is in the Oneworld (ONW) alliance, while TAM (TPR) joined the Star (SAL) Alliance in May. (LAN) CEO and designated LATAM CEO, Enrique Cueto said the airlines "don't have an answer to that question" presently.
"There are hundreds of millions of dollars at stake when measured in access to almost the entire South American market,"the Centre for Asia Pacific Aviation (CAPA) said in an analysis of the proposed merger and its global implications. It said (LAN) is the "driver" behind the merger and will ultimately make the call on which alliance the group will be a part of, possibly favoring the Oneworld (ONW) alliance.
"But merely dumping the Star (SAL) alliance is not a decision to be taken lightly," it stated. "TAM (TPR) has many valuable linkages throughout the Star (SAL) alliance grouping."
September 2010: The Oneworld (ONW) alliance announced that S7 Airlines (SBR) will officially become a full member of the alliance on November 15. (SBR), which began the process of joining the Oneworld (ONW) alliance last year with British Airways (BAB) as its sponsor, will become the (ONW) alliance's 11th member. It becomes the second Russian airline to join a global alliance; Aeroflot (ARO) became a SkyTeam (STM) alliance member in 2006. (SBR), Russia's top domestic carrier by traffic, will add +55 destinations to (ONW)'s network including linking the alliance to Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan. "This will almost triple the number of destinations served by the (ONW) alliance in Russia, the (CIS) and other parts of East Europe to a total 84 destinations in 26 countries," the (ONW) said. Current members (BAB), Cathay Pacific (CAT), Finnair (FIN), Iberia (IBE), Japan Airlines (JAL), Malev (HGA), and Royal Jordanian (RJA) all serve Moscow.
"Work is well advanced in linking up (SBR)'s Information Technology (IT) systems to those of the (ONW) alliance's established members," the (ONW) alliance said in a statement. "Projects are also nearing completion to bring (SBR)'s various internal processes and procedures into line with the (ONW) alliance's requirements, and extensive employee training and communications programs are now underway at the (SBR) and the (ONW) alliance's existing members."
(ONW) alliance Managing Partner, John McCulloch added, "(SBR) will expand the (ONW) alliance's network substantially in a key region of growing travel demand, with a carrier that matches our demanding quality requirements, while enabling (Sbr) to offer its customers a truly global network." (SBR) CEO, Vladimir Obyedkov noted that "becoming part of the (ONW) alliance will be one of the most significant steps in (SBR)'s history. It will also strengthen us financially through revenues from passengers transferring to our network from our (ONW) partners and the cost reduction opportunities the alliance offers."
American Airlines (AAL) said it will move its Tokyo-based Asia/Pacific regional office to a vacant floor at Japan Airlines (JAL)/(JAS)'s (JAL) Building headquarters by January. The Oneworld (ONW) alliance partners have jointly applied to the Japanese Transport Ministry and the USA Department of Transportation for antitrust immunity (ATI) to operate as if they are one airline for commercial purposes on flights between North America and Asia. "With American (AAL)'s proposed Pacific joint business with (JAL)/(JAS) anticipated to receive government approval by the end of this year, co-locating our offices with those of (JAL) will be beneficial and enable us to forge closer working relationships," (AAL) said in a statement. "We have been working closely so that we will be able to implement our joint business as quickly as possible after government approvals are received."
October 2010: Oneworld (ONW) alliance carriers British Airways (BAB), Iberia (IBE) and American Airlines (AAL) are to open four new routes next April as part of their new transatlantic joint venture (JV). (AAL) will operate New York (JFK) - Budapest and Chicago - Helsinki, connecting the USA gateways with the bases of Oneworld (ONW) members Malev (HGA) and Finnair (FIN).
(BAB) will operate London Heathrow - San Diego, while Iberia (IBE) will open Madrid - Los Angeles.
(ONW) disclosed the routes at an event marking the three-way tie-up in London. (BAB) CEO, Willie Walsh describes the venture as "historic", adding: "We've waited 14 years for this."
(AAL) is placing its code on 322 (BAB) and Iberia (IBE) flights, while (BAB) will add its code to 2,063 (AAL) and Iberia (IBE) flights.
(IBE)'s code will feature on 354 flights operated by (BAB) and (AAL).
"There will be further opportunities to increase code shares in future," Oneworld (ONW) adds.
November 2010: S7 Airlines (SBR) announced it officially joined the Oneworld (ONW) alliance, making it the second Russian airline to join an alliance behind Aeroflot (ARO), which became a member of the SkyTeam (STM) alliance in 2006. S7 (SBR) subsidiary Globus (GLP) also joined as an affiliate member.
(SBR) said that joining the (ONW) alliance completes “one of the biggest projects” in its history and “strengthens its competitive and financial position.”
According to a statement, S7 (SBR) and Globus (GLP) serve 90 destinations and 28 countries, adding 55 destinations in Russia and the (CIS) and nine countries to the alliance. Seven (ONW) alliance airlines serve Moscow, St Petersburg, and Ekaterinburg in Russia.
(SBR) CEO, Vladislav Filev said its membership “represents the start of a new and exciting era for (SBR)” noting (SBR) will now move “into the next phase of its development as part of the highest quality grouping of airlines.”
(ONW) alliance Managing Partner, John McCulloch said that (SBR) will expand its network “substantially” in a “key region of growing travel demand.” (SBR) operates 28 A320 family airplanes, one A310, two 767s, four 737-400s and four 737-800s.
(SBR) and (GLP) carried 5.6 million passengers in 2009. (SBR)’s main hub is Moscow Domodedovo with secondary hubs in Novosibirsk and Irkutsk. (SBR) also serves (ONW) alliance hubs Madrid and Bangkok. Air Berlin (BER) and Kingfisher Airlines (KFH) plan to join the Oneworld (ONW) alliance in the next 18 months.
December 2010: Bruce Ashby is taking the reins of the Oneworld (ONW) alliance under a restructuring that relocates the (ONW) alliance’s headquarters to New York from Vancouver. Ashby, with immediate effect, assumes the responsibilities currently held by John McCulloch, who is citing family reasons for leaving the Managing Partner role he has held for the past seven years. Ashby will head the
organization as CEO.
Besides the 25-strong central Oneworld (ONW) alliance team, up to 210 employees from across the (ONW) alliance's member airlines will be based there, in a largely "open plan" layout, designed to promote collaboration across the alliance teams. The first of them should make the move by mid-summer 2011, the Oneworld (ONW) alliance said.
Separately, Delta (DAL) says Nicolas Ferri is leaving the Oneworld (ONW) alliance as VP Sales to assume a newly created, VP Latin America
& the Caribbean role on January 1. Ferri will report to (DAL)
President, Ed Bastian.
January 2011: Iberia (IBE) has added a new online check-in service. Its "Through Check-in" service will enable customers to obtain boarding cards for (IBE) code share or connecting flights on 29 airlines, including its 11 partners in the Oneworld (ONW) airline alliance.
February 2011: Jetstar (IMU) launched an interline agreement across its group of airlines with Oneworld (ONW) alliance carrier, Finnair (FIN). The partnership allows (FIN) passengers to purchase a Jetstar (IMU), Jetstar Asia (JSA), Valuair (VLU) or Jetstar Pacific (PAH) flight as part of a single integrated transaction and travel itinerary and sold on a (FIN) E-ticket.
March 2011: Air Berlin (BER) CEO, Joachim Hunold said that (BER) is busy completing the necessary requirements to join the Oneworld (ONW) alliance by April 2012. "This is a very challenging year for us. All of our resources are focused on the work [necessary] for future (ONW) membership," he said. "We are on track." To join the (ONW) alliance, (BER) will have to update its Information Technology (IT) system and upgrade its long-haul product.
Hunold said (BER) will invest around €10 million/$13.9 million to become Oneworld (ONW)-ready. It will reconfigure 10 A330-200s with new business (C) and economy (Y) seats starting in November.
(BER) also plans to expand its services from Berlin Tegel, Dusseldorf, and Palma de Mallorca. In May, (BER) will add new flights from Berlin (TXL) to New York (JFK) and Linz. "This move should increase our presence in Germany, Switzerland, and Austria together with our partner airline Niki (NKI) [in which (BER) owns a 49.9% stake]," Hunold stated.
He said (BER) will likely take delivery of the first of 15 787s it has on order in the fall of 2014. It was originally supposed to receive its first 787 Dreamliner next year. (BER) also holds 10 787 options. Last month, it took delivery of the first 737-700, outfitted with the new Sky Interior cabin.
(BER) is expecting to report a net loss for its fiscal year ending March 31 but predicts a positive operating result.
June 2011: Australia's Qantas Airways (QAN) will sponsor Malaysia Airlines (MAS)'s entry into the Oneworld (ONW) alliance as it looks to form a close partnership with (MAS) as part of its plan to lift its share of the Asian market.
(MAS) CEO, Azmil Zahruddin said that the airline had carried out a careful analysis of the alliance options and concluded that "the time is clearly right for our company to join one of the global service groups and the (ONW) alliance is clearly the best option for us."
"The (ONW) alliance already features four of the best airlines in the Asia-Pacific, including member-elect, Kingfisher Airlines (KFH)," said (ONW) alliance CEO, Bruce Ashby. "Adding another leading Asian carrier, in (MAS), will greatly enhance the (ONW) alliance's offering throughout the world's fast growing region for air travel demand."
(QAN) CEO, Alan Joyce said (QAN) had been talking to (MAS) for quite some time and would help make the necessary changes for (MAS) to join the (ONW) alliance by the end of 2012. However, he said the entry of (MAS) into the (ONW) alliance would not diminish (QAN)'s presence in Singapore. "I think it opens up opportunities for (QAN) going forward," Joyce said. "However, we will still have a big operation in Singapore." He added, "We are keen to discuss how we can cooperate in the Malaysian and South-East Asian markets. That dialogue will continue; we think there is a lot of opportunity for us to work together."
August 2011: According to "The Malaysian Insider," Malaysian Airlines (MAS) is looking to defer some A380 capacity and possibly delay its entry into the Oneworld (ONW) Alliance.
October 2011: Air Berlin (BER) is strengthening its Eastern Europe network for the winter schedule to prepare for upcoming membership into the Oneworld (ONW) alliance.
(BER) and Austrian partner, Niki (NKI) will synchronize schedules by offering flights up to 3X daily from Vienna (VIE) to Bucharest Otopeni, Sofia, and Belgrade, connecting (via (VIE)) to Berlin Tegel (TXL), Dusseldorf (DUS), Hamburg, Hanover, Nuremberg, and Zurich.
(NKI) President, Niki Lauda said that “Niki (NKI) will operate 23 airplanes next year. We [will] switch our check-in area to [the] main Terminal 1 in (VIE) from the second part of 2011 and locate all Air Berlin (BER) and Oneworld (ONW) alliance members there.” The switch will be possible when (VIE) opens its new terminal, SkyLink, in June 2012, when most of the Star (SAL) Alliance carriers move to the new facility.
(BER) said a capacity increase of almost +35% from the Russian market has enabled better connections to Europe and long-haul flights. Passenger boardings have increased by more than >+50%.
Starting from the winter schedule, (BER)/Niki (NKI) will offer 50 flights per week to Moscow Domodedovo and St Petersburg from (TXL), (DUS), Munich, St Thomas, (VIE), and Salzburg.
As of May 1, (BER) will triple flights to Kracow and will link Gdansk to (TXL) with 2X-daily connections per week during off-peak times and one flight connection Saturdays and Sundays.
December 2011: The Oneworld (ONW) Alliance has elected American Airlines (AAL) Chairman, President & CEO, Tom Horton as its Chairman. He takes on the role from Gerard Arpey, who retired in late November.
(ONW) Alliance (CEO), Bruce Ashby said that Horton “worked hand-in-glove in (ONW) Alliance matters with Gerard Arpey during Gerard's period of tenure as Chairman and has played a pivotal role in strengthening our alliance through the significant deepening of cooperation between American (AAL) and so many of our other member airlines in recent years.”
Horton joined (AAL) parent, the (AMR) Corporation in 1985 and has held a range of senior financial positions, including VP and Controller. Prior to his recent appointment as (AAL)’s Chairman & CEO, Horton was named President of AMR and (AAL) in July 2010.
January 2012: Air Berlin (BER), soon to be the Oneworld (ONW) Alliance’s German representative, is taking a gamble on Dusseldorf flights to Las Vegas.
February 2012: Air Berlin (BER) has received the green light to join the Oneworld (ONW) Alliance March 20 after completing a review by British Airways (BAB), which is sponsoring its entry. (BER) as
Europe's sixth largest carrier, will also bring in Austrian partner FlyNiki (NKI) as an affiliate member.
(BER) (CEO) Hartmut Mehdorn said joining the (ONW) Alliance will “strengthen our competitive position considerably, enabling us to offer our customers a truly global network together with our partners who include some of the best and biggest airlines in the world, while enabling us also to tap into all the financial benefits that come from being part of a global alliance, through additional passenger feed and participation in various efficiency programs.”
Former (BER) (CEO), Joachim Hunold said last March that (BER) invested around €10 million/$13.9 million to become (ONW)-ready.
(BER) and (ONW) Alliance partners will move to Berlin Brandenburg airport (BER), which will open June 3, eventually carrying 27 million passengers a year. Since accepting an invitation to join the (ONW) Alliance in July 2010, (BER) has established code share agreements with seven (ONW) Alliance partners: American Airlines (AAL), (BAB), Finnair (FIN), Iberia (IBE), Malev Hungarian Airlines (HGA), Royal Jordanian (RJA), and S7 (SBR).
FlyNiki (NKI) will strengthen its position in Eastern Europe when Air Berlin (BER) becomes a Oneworld (ONW) Alliance member March 20. FlyNiki (NKI), a (BER) subsidiary, will join the (ONW) alliance as an affiliate member.
(NKI) Managing Director, Christian Lesjak said that (ONW) alliance membership will generate new potential and secure its position for future growth, especially after Malev Hungarian Airlines (HGA) ceased operations, which caused the (ONW) alliance to lose a Budapest hub and some important links to Eastern European destinations.
(NKI)’s fleet (which includes A319s, A320s and A321s and Embraer EMB-190s/195s) will grow from 23 airplanes this year to 26 in 2013 as it adds three more A320s.
Lesjak said (NKI) is evaluating “new routes to nations like Russia, the Ukraine, the Balkans, Tirana or Sarajevo.”
He said one of (NKI)’s highest priorities is hub connectivity within the Air Berlin (BER) Group, such as Vienna (VIE), Berlin, Dusseldorf and Abu Dhabi. Lesjak said that currently less than <10% of (NKI)'s passengers are changing airplanes in (VIE) within the (BER) group; he expects this to increase in 2012. On some dedicated connecting flights, the transfer share is already around 30% [in (VIE)], he said. He predicts long-haul routes to (VIE) will open up, creating growth opportunities for (NKI).
In 2011, (NKI) had a turnover of €435 million/$575.8 million, up +29% compared to €337 million the year before. Lesjak said positive 2011 results will be announced soon. (NKI) transported 4.5 million passengers last year, up +32% from 3.4 million in 2010, and is expecting more than >5 million in 2012.
(NKI) operates four A321s, 10 A320s and seven Embraer EMB-190s. Two more airplanes will join the fleet this year.
The (ONW) Alliance includes 11 carriers and around 20 affiliates.
Troubled Kingfisher Airlines (KFH) received more bad news when the Oneworld (ONW) Alliance put the Indian carrier's entrance into the alliance, which had been planned for February 10, "on hold."
The Oneworld (ONW) Alliance said (KFH) needs "time to strengthen its financial position." (KFH) became a Oneworld (ONW) Alliance-member elect in 2010.
(ONW) Alliance (CEO), Bruce Ashby said, "These are turbulent times for the airline industry in India and many other parts of the world. We have been working closely with (KFH) over the past months and it has become increasingly clear recently that (KFH) needs more time to resolve the financial issues it is confronting before it can be welcomed into the (ONW) Alliance."
(KFH) Founder & Chairman, Vijay Mallya said, "In light of the many priorities centered around (KFH)'s recapitalization efforts, we felt it prudent to defer our entry into the alliance for a little while."
Air Berlin (BER) became a member of the Oneworld (ONW) Alliance in a joining ceremony at the new Berlin Brandenburg Airport (BER), which will serve as (BER)’s home base and be Europe’s newest hub when it opens June 3. (BER)'s Austrian partner, FlyNiki (NKI), became an affiliate member of the alliance.
(BER), Germany’s second biggest passenger airline, has a 40% domestic market share. (BER)’s entry into the (ONW) Alliance more than triples the number of cities served by the (ONW) Alliance in Germany to 25. FlyNiki (NKI) doubles its coverage of Austria to six airports. “Becoming a member of the (ONW) Alliance is one of the most significant [achievements] for (BER),” (CEO), Hartmut Mehdorn said.
The International Airlines Group (IAG) (CEO), Willie Walsh said during the joining ceremony that (BER)'s entry, British Airways (BAB)'s acquisition of British Midland International (bmi) (BMA) and the launch of Iberia (IBE) Express will boost the (ONW) Alliance's presence in Europe.
“Maybe our alliance is not very well known in this part of Europe, [but] now we will change that,” American Airlines (AAL) Chairman & (CEO), Tom Horton added during the ceremony.
(BER) serves 162 destinations in 40 countries. It carried more than >35 million passengers in 2011. The (ONW) Alliance now has 11 full members.
April 2012: Air Tahiti Nui (NUI) has started talks to join the Oneworld (ONW) alliance according to the President of French Polynesia.
May 2012: Japan Airlines (JAL)/(JAS) and the International Airlines Group (IAG) (BAB)/(IBE) have been granted antitrust immunity (ATI) from the Japanese Ministry of Land, Infrastructure, Transport & Tourism (MLIT) to cooperate commercially on flights between Europe and Japan.
The joint business, which will provide better links and more routes between the European Union (EU) and Japan, is expected to launch by late March 2013.
The revenue-sharing agreement will strengthen the Oneworld (ONW) alliance, enabling it to compete more effectively with other global alliances, according to (JAL)/(JAS).
(JAL) President, Yoshiharu Ueki said, "Amid the evolving Japanese aviation industry, the (ATI) will enable us to build a strong value-creating relationship with British Airways (BAB) that can benefit our customers as well as our businesses.”
June 2012: SriLankan Airlines (LNK) has been elected as a Oneworld (ONW) Alliance member, (ONW) announced just prior to the opening of (IATA)'s 2012 World Air Transport Summit in Beijing. (LNK) is expected to join (ONW) late next year.
(LNK) Chairman, Nishantha Wickremasinghe said (LNK) has “virtually doubled our size since peace returned to our country three years ago, and we plan further substantial expansion to our fleet and network in the next few years.”
(LNK) also announced it will code share with Oneworld (ONW) Alliance partners, Royal Jordanian (RJA) and S7 Airlines (SBR).
(SBR) operates a fleet of 21 airplanes and carried 3.5 million passengers last year between its Colombo base and 34 destinations in 22 countries across Asia, Europe and the Middle East.
According to the Oneworld (ONW) Alliance, (LNK) will bring three new destinations into the (ONW) alliance’s network, all in southern India: Kochi, Tiruchirapalli, and Thiruvananthapuram, expanding (ONW)'s global coverage to some 850 destinations in more than >150 countries and generating annual revenues of more than >$100 billion.
American Airlines (AAL) (CEO) and Oneworld (ONW) Alliance Chairman, Tom Horton said that Malaysia Airlines (MAS) “is on the right track to join the (ONW) alliance later this year.”
Comment by Nix Xaviaero: The long haul fleet of (LNK) is OLD and the interior facilities do not match with any of the major Oneworld (ONW) Alliance member carriers. Communication of cabin staff in English is poor. (LNK) very badly needs to modernize its long haul fleet and follow through its often publicized desire for the acquisition of 777s. Per my experience, the only (LNK) A340 that has flat beds is the recent purchase from the aging Cathay (CAT) fleet.
Japan Airlines (JAL) has adjusted its international route and flight frequencies for this financial year. (JAL) confirmed it will launch 4X-weekly, Tokyo Narita (NRT) - San Diego, California on December 2, which will be jointly served with Oneworld (ONW) alliance partner, American Airlines (AAL).
July 2012: Malaysia Airlines (MAS) is anticipating an extra $100 million in revenue from interlining passengers when it joins the Oneworld (ONW) alliance early next year.
(MAS) currently registers MYR750 million/$235.8 million annually in interlining passenger revenue, Senior VP International Affairs, Germal Singh Khera said at a media briefing. “We are foreseeing the additional revenue to roll in as early as next year, with (MAS) completing all commercial agreements with all other members of the Oneworld (ONW) alliance. We are currently at the last lap of our project to synchronize our system to accommodate the (ONW) alliance members to give our customers a better and holistic network coverage,” he said. (MAS) expects to conclude all work and officially join the (ONW) alliance in the first quarter of next year, Germal said.
(MAS)’s inclusion in the (ONW) alliance also opens up opportunities to forge joint ventures with other airlines in the alliance, he added, specifically mentioning Qantas (QAS).
(ONW) alliance VP Corporate Communications, Michael Blunt said (MAS) will be the (ONW) alliance’s representative in the Southeast Asia region. “We don’t have a representative here. Southeast Asia is a place with many competitor airlines. As such, (MAS)’s inclusion into the (ONW) alliance will serve as the base for the region,” he said.
After (MAS), Sri Lankan Airlines (LNK) will follow and be inducted into the (ONW) alliance.
October 2012: Qatar Airways (QTA) was officially invited to join the Oneworld (ONW) Alliance and appears set to become the first major Gulf carrier to enter into one of the three global airline alliances when it becomes a full member in 12-18 months. “Things are changing in the Middle East and in the global aviation industry,” (QTA) (CEO), Akbar Al Baker said. “When you cannot defeat your competitors, you join them. And that is what is happening here.”
International Airlines Group (IAG) (CEO), Willie Walsh called (QTA) joining the (ONW) Alliance a “landmark” for the alliance. “The Middle East is one of the world’s fastest growing regions for air transport demand [and] Qatar Airways (QTA) is one of the world’s fastest growing airlines,” he said. “(QTA) is the second largest full-service airline in the world (until today) not aligned with one of the world’s global alliances.”
(QTA), which was founded in 1997, has a fleet of 111 airplanes and carried 15 million passengers in 2011. Al Baker said joining the (ONW) alliance will not slow (QTA)’s rapid pace of growth. “Becoming part of an alliance will not stop our expansion,” he said. “Quite the contrary.”
He expressed confidence (QTA) will be able to fully join the (ONW) alliance in as few as 12 months. “We have a lot of integration of systems, processes, frequent flier programs to do,” he explained. He noted there is already system “commonality” in many areas, which should speed the process.
He said the (ONW) alliance and rival alliances: Star (SAL) and SkyTeam (STM) may now be coming to the conclusion that it is “best to partner with the Gulf carriers rather than thinking we are the pariahs of the industry.”
Malaysia Airlines (MAS) will become a full member of the Oneworld (ONW) alliance on February 1. (MAS) received clearance to join the (ONW) alliance after a review of its readiness by Qantas (QAN), which is sponsoring its entry into the (ONW) alliance. The decision to bring (MAS) into (ONW) was announced in June 2011.
(MAS) said its (ONW) alliance implementation program was on track to be completed in the coming months, but formal membership was being delayed to February “to avoid the end-of-year holiday season and for other administrative reasons.”
(MAS) will become the second (ONW) A380 operator, after (QAN).
In August, (MAS) reported a second-quarter net loss of -MYR348.7 million/-$109 million, a +34% improvement on a loss of -MYR525.8 million year-over-year.
November 2012: Open Skies (OPK) has announced that it will officially become an affiliate member of the Oneworld (ONW) Alliance from December 1. The International Airlines Group (IAG) subsidiary originally set-up by British Airways (BAB) in 2008 currently operates three 757-200s on two daily services between Paris Orly (ORY) and Newark Liberty International (EWR). It plans to add a third daily service between Paris and New York from March 31 again, with this new service operating from Orly to New York John F Kennedy International (JFK) instead of Newark.
December 2012: The balance of power in the London Heathrow (LHR) long-haul market may once again shift, as the Virgin Group and Singapore Airlines (SIA) appear to be moving closer to selling a stake in Virgin Atlantic (VAA), possibly to Delta Air Lines (DAL) and AirFrance (AFA)-(KLM).
(SIA) in a short statement to the Singapore stock exchange says it is “in discussions with interested parties concerning the possible divestment of its 49% shareholding in Virgin Atlantic (VAA).” But it adds, “These discussions may or may not result in a transaction.”
The disclosure came after UK newspaper "The Sunday Times," without citing sources, reported that (DAL) is in talks with (SIA) to buy its 49% stake in (VAA). The report also says (DAL)’s SkyTeam (STM) Alliance partners AirFrance (AFA)-(KLM) is planning to buy part of the Virgin Group’s 51% stake in (VAA).
(DAL), meanwhile, is not commenting on the story, calling it rumor and speculation. If (DAL) proceeds with the acquisition, the move would provide a major boost to the (STM) Alliance’s access at (LHR), and at the same time curtail Star (SAL) Alliance’s reach at the airport, which has been limited by Lufthansa (DLH)’s sale of its BMI (BMA) division to the International Airlines Group (IAG) unit British Airways (BAB). (BAB) currently is the dominant player on transatlantic services from (LHR), a position that is strengthened by its joint venture with Oneworld (ONW) Alliance partner American Airlines (AAL).
In contrast, (VAA)’s strategic position has become weaker as its competitors grow. This prompted (VAA) in 2010 to appoint an adviser to investigate potential growth options, including alliance membership and buying a stake in another airline. Sir Richard Branson, (VAA)’s controlling shareholder through his Virgin Group, has said that he wants to remain involved in (VAA) even if part of (VAA) is sold.
(VAA)’s biggest asset is its transatlantic network from (LHR), the main gateway into the UK and one of the world’s most important business destinations. But (VAA) has been losing money. In the 12 months ending February 29, (VAA) posted a loss of -£80 million/-$128.3 million, compared to a profit of +£18.5 million in the previous year. (VAA)’s (CEO), Steve Ridgway, at the time said the loss was due to “sky-high fuel prices,” global economic uncertainty and a +25% increase in passenger duty fees. Ridgway is due to retire from his position in early 2013.
(VAA) is particularly vulnerable to high fuel prices. Its fleet of 42 airplanes includes four A340-300s, 17 A340-600s and 13 747-400s. These four-engine airplane types burn more fuel and are more expensive to maintain than newer models. (VAA) has taken steps to update its fleet by ordering 16 787-9s and six A380s. First delivery of the 787-9s and A380s is in 2014 and 2015, respectively, says (VAA).
Despite the cost exposure, (VAA) has valuable airport slots and may be of strategic importance to a USA carrier. It will still be difficult for (SIA) to secure a price comparable to what it paid for its stake in early 2000. (SIA) paid £600.25 million for the 49% share, which included a capital injection of £49 million. The deal valued (VAA) at £1.2 billion, but (SIA) has since written down the value of the shareholding.
Star (SAL) Alliance member AviancaTaca Airlines (AVI)/(TAC) is ready to fill the gap in Brazil if (TAM) Airlines (TPR) leaves the (SAL) alliance, as expected. Brazilian-based, (TAM) (TPR) merged with Oneworld (ONW) Alliance member (LAN) Airlines earlier this year, creating the (LATAM) Group.
(AVI)/(TAC) (CEO), Fabio Villegas Ramirez said (AVI)/(TAC) is working to tap more into Brazil, which he considers an “important market. It is difficult to operate there, but it is a market you have to be in.”
A top Star (SAL) Alliance executive said that TAM Airlines (TPR) will have to pay a $25 million fee to leave the (SAL) alliance.
The (AVI)/(TAC) group of airlines, which was formed from the merger of Colombia’s Avianca (AVI) and El Salvador’s Grupo (TACA) (TAC) into AviancaTaca (AVI)/(TAC), said it will unify all members under the single "Avianca" brand “by the second part of this year.”
Ramirez said the (AVI)/(TAC), which is expecting a +15% passenger year-over-year growth, has “the opportunity to be in one of the top markets in Latin America.” He said (AVI)/(TAC) will “increase frequencies and add new destinations” to counter the effects of the economic weakness of Europe and the USA. “You always have issues here [in Latin America], like increasing fuel prices, but we will be conservative to maintain our profitability.”
The (AVI)/(TAC) group operates 150 airplanes. “We have 51 Airbus (EDS) airplanes and 15 Boeing (TBC) 787s on order and are planning to add new destinations in Europe, like London or Frankfurt,” Ramirez said.
The Australian Competition & Consumer Commission (ACCC) has given its conditional approval of the proposed Qantas Airways (QAN) and Emirates (EAD) alliance.
The antitrust regulator said that the two airlines will be allowed to “cooperate on passenger and freight operations across their networks.” However, it wants to restrict cooperation between the airlines on flights between Australia and New Zealand to ensure that an acceptable level of service is maintained.
(QAN) said it expects final approval of the partnership by March 2013. (QAN) (CEO), Alan Joyce said “Our customer research has shown very strong support for the (QAN) and (EAD) partnership, particularly in terms of increasing one-stop access to Europe, cutting travel time and offering frequent flyer benefits.”
(EAD) President, Tim Clark added, “The partnership with (QAN) means we can add regional destinations like the Gold Coast and Hobart to the growing list of places we offer (EAD) customers worldwide.” The two airlines said they have already “started initial preparations that do not require regulatory approval, including connecting Information Technology (IT) systems, designing frequent flyer benefits and establishing an operational base for (QAN) in Dubai.”
(ACCC) Chairman, Rod Sims said, “The (ACCC) is of the view that the main benefit arising from the alliance is an improved product and service offering by the two airlines to their customers.” He added, “The alliance is likely to result in some public detriments through its effect on competition where (QAN) and (EAD) currently offer overlapping services. In most of these regions, there are factors which are likely to mitigate the public detriment, including continuing competition from a number of established airlines.” The exception, he said, is on Australia - New Zealand routes, where conditions will be put on the alliance.
The (ACCC) said it will require the alliance to be reviewed for approval again in five years. The airlines had requested to gain immunity for 10 years without a review. (QAN) is a member of the Oneworld (ONW) Alliance, while Emirates (EAD) has remained independent of the three global airline alliances.
February 2013: The addition of Malaysia Airlines (MAS) to the Oneworld (ONW) alliance brings membership up to 12 carriers serving 842 destinations to 156 countries. It was the “best fit” for (MAS), Group (CEO) Ahmad Jauhari Yahya said. SEE ATTACHED PHOTO - - "ONW-2013-02 - NEW ONEWORLD MEMBER."
Two more carriers, Qatar (QTA) and SriLankan Airlines (LNK), have been nominated to join. (MAS) is the first (ONW) alliance carrier from the country, while SriLankan (LNK) will be the first Indian sub-continent carrier and (QTA) will be the first of the “big three” (MEB3) Gulf carriers to join any of the three global alliances.
March 2013: USA airline consolidation is complete. Just in case you have been living in a cave recently, there will now be only three USA network airlines by this fall (regulatory clearance is expected in the third quarter (Q3) 2013): (AAL), which will marginally become the world’s largest airline, United Airlines (UAL) and Delta Air Lines (DAL). In terms of capacity, these three, plus Southwest Airlines (SWA) will dominate 90% of the USA domestic seats.
Outside of the combined carrier’s 10 recognized hubs and focus airports (in order of size — Dallas/Fort Worth, Charlotte, Miami, Chicago O’Hare, Philadelphia, Phoenix, Washington National, Los Angeles, New York La Guardia and New York (JFK)), which will represent nearly 60% of the new airline’s weekly seat capacity, a host of second tier airports will be jostling to maintain their based airplanes and gate space with the new (AAL). At the largest of these airports, Boston Logan, US Airways (AMW)/(USA) is the #3 operator ((AAL) is fifth) behind JetBlue Airways (JBL) and Delta (DAL), but the new united carrier will jump to second place with 23% of all seats, and will be more than double the size of (UAL) in fourth spot, and four times larger than (SWA).
The standing for the conjoined airline will improve even more markedly at San Francisco, where pre-merger (AAL) is in fifth spot ((AMW)/(USA) is 6th), lagging the (UAL) hub, (DAL), Virgin America (VUS) and (SWA). After the merger is finalized, (AAL) will barge its way into second place, still only one-fifth the size of (UAL), but commanding 10% of all seats from the Californian airport. Looking at low-cost dominated Fort Lauderdale, US Airways (AMW)/(USA) held the lowly position of sixth ((AAL) was seventh). However, the merged entity will become the largest network carrier at the Florida airport, but will still trail JetBlue (JBL), Spirit Airlines (SPR) and (SWA).
Network overlap is very limited, since the two airlines only compete on 12 of their 900 amalgamated routes, which is one reason that many industry observers feel the merger will be viewed far more favorably than when US Airways (AMW)/(USA) tried to tie the knot with (DAL) in 2006. As (AMW)/(USA) is expected to leave the Star (SAL) Alliance, and the combined carrier will join the Oneworld (ONW) Alliance, the fact that Heathrow will become (AAL)’s number one international port-of-call, is significant. In the process, the new (AAL) will become the largest USA network airline at the London airport, boasting an additional +3,800 weekly seats than its nearest rival (UAL). The tie-up is also anticipated to see Oneworld (ONW) Alliance’s global market share rise from 26% to 34%.
With one exception, of all the remaining top 12 routes, either (AAL) or (AMW)/(USA) was already the leading network airline across all the above destinations, so the fused company will further consolidate its dominance in these markets. It is as at Cancun, where it will leapfrog (UAL) to become top dog, and at the same time hold a 40% advantage over its rival in terms of seats, and become more than four times bigger than (DAL).
The new company will offer flights to 336 destinations (218 domestic, 118 international) in 56 countries. However, the merger will see (AAL) return to Belgium (it last cancelled its New York (JFK) flights on 6 November 2012) and see new operations at both Tel Aviv and Amsterdam, neither of which it currently serves, but (AMW)/(USA) does fly both daily from Philadelphia.
The biggest country market beneficiaries of the deal are Germany, Brazil and Jamaica. While for pre-merger (AAL), Germany is only its 27th largest country market in its portfolio, it is US Airways (AMW)/(USA)’s #2, which has pushed the nation up to sixth place when both airlines come together. Roles are reversed when it comes to Brazil, which is only the 16th biggest country market for (AMW)/(USA), but for its merger partner (AAL) was rated as third most significant, resulting in Brazil taking the third spot overall. Two country markets now inside the top 12 (namely Venezuela and Japan) were previously not even served by (AMW)/(USA). Only time will tell whether the regulators will have a significant impact on these markets when they make their recommendations later in the year.
Finnair (FIN) will join the American Airlines (AAL)/British Airways (BAB)/Iberia (IBE) transatlantic joint venture (JV) at an unspecified date later this year. (FIN), a Oneworld (ONW) Alliance member like the three (JV) partners, said it will add its AY code to selected (JV) flights between North America and the European Union (eu), plus Norway and Switzerland. The AA, BA and IB codes will be added to Finnair (FIN)’s daily, Helsinki - New York (JFK) flights.
Including the (FIN) flights, the (JV) (launched in October 2010) will operate up to 102 daily flights between North America and Europe.
“Our participation in this venture will open up Northern Europe to a whole new network of potential travelers,” (FIN) Senior VP Commercial, Allister Paterson said.
If a year ago the troubles seemed to be coming thick and fast for some of Oneworld (ONW) Alliance's carriers, the confirmation that Brazilian carrier TAM (TPR) is to join the (ONW) alliance has capped an altogether happier period since.
A year ago, the (ONW) Alliance was suffering after the collapse of Malev (HGA), the continued failure to get Mexicana (CMA) back in the air, the bankruptcy filing of founder member (AAL) and the financial meltdown of the airline identified as its partner in India, Kingfisher Airlines (KFH).
While challenges remains (and others have emerged such as Qantas (QAN) ditching of its kangaroo route partnership with British Airways (BAB) and the continued delay in the opening of new Air Berlin (BER)'s new airport hub), the last few months have delivered a series of positives.
Plans to bring Qatar Airways (QTA) into the (ONW) alliance provide it a strengthened presence in the Middle East and beyond, while (AAL) looks set to emerge stronger (and bigger) from Chapter 11 bankruptcy protection through a merger with US Airways (AMW)/(USA). Now the (LATAM) Group has put an end to nearly three years of uncertainty over its future alliance strategy, aligning all its airline partner with the Oneworld (ONW) alliance. Not only does that ensure (LAN) remains in the (ONW) Alliance, it brings the alliance its first Brazilian partner in the shape of (TAM) (TPR).
"This is great news for us, becoming the biggest alliance out of South America," says (ONW) (CEO), Bruce Ashby. "Brazil is a huge market. It's a (BRIC) country."
(TAM) (TPR) is the largest Brazilian airline. It carried nearly 38 million passengers in 2011, generating revenues of $7.6 billion. It operates a fleet of 161 airplanes and had a further 100 on order.
The Brazilian carrier only formally joined the Star (SAL) Alliance in 2010, but its future in the grouping has been under scrutiny ever since its merger with (LAN) was unveiled a few months later. The partners put an alliance decision on hold as it concentrated on completing the merger, but this process stalled by delays in the regulatory process which meant the new combined (LATAM) Airlines was only established last summer.
During this period, the Star (SAL) alliance fought hard to keep its Brazilian carrier, while an option outside the alliances was also considered. The (SAL) Alliance appeared to always be going to have its work cut out, in part because of (LAN)'s long-standing membership in Oneworld (ONW) Alliance but also after a competition ruling attached to the merger prevented (LATAM) from being in the same alliance as Latin America's next biggest carrier AviancaTaca (AVI)/(TAC). The latter joined the Star (SAL) Alliance last year.
"While we were confident we eventually [would get] (TAM), it's nice to have it confirmed. So while it's not a great surprise, it's a great pleasure for us," says Ashby. "One of the reasons why was we had a great business proposition. If you look at where travellers from the region go, the big cities (New York, Miami, Madrid and London) we have alliance hubs in each of those places."
Existing partners (AAL), (BAB), (IBE) and (LAN) already serve seven destinations in Brazil, but (TAM) (TPR) will bring with it 42 new destinations to the (ONW) Alliance.
The decision for (TAM) (TPR) to join the (ONW) Alliance was part of a wider commitment by (LATAM) Airlines to align all its airline partners with the alliance. That means LAN Colombia (REU) will also join the alliance later this year, bringing with it 21 new destinations to the (ONW) alliance.
No precise date has been set yet for TAM's entry into Oneworld, but it will be timed for immediately after it leaves Star and is expected around the second quarter of next year.
"Membership of Latin America's leading airline group, the (LATAM) Airlines Group, in the (ONW) Alliance represents a major landmark in our journey towards establishing the (ONW) Alliance firmly as the first choice airline alliance for travellers not just across the Americas, but the world over," says (AAL) (CEO), Tom Horton.
The news comes shortly after the (ONW) alliance was boosted by plans for the merger of (AAL) with another Star (SAL) Alliance carrier, US Airways (AMW)/(USA). No date has yet been set for (AMW)/(USA) to quit the (SAL) Alliance, but it will join the (ONW) alliance as part of its planned merger with American.
That deal has been welcomed by (AAL)'s (ONW) alliance partners. "The merged American and US Airways will be the biggest carrier operating out of the USA," says Ashby. "In terms of the (ONW) Alliance, it's a healthier (AAL) with more mass and more feed. So it's good for all the other (ONW) alliance members."
The (ONW) alliance is the smallest of the global alliances by size, though it has always stressed it attaches more value from the number of key business markets it serves. The grouping last year held a 15% share of traffic among the top 200 airlines and Malaysia Airlines (MAS) last month became the grouping's 12th active member.
April 2013: The merged American Airlines (AAL) and US Airways (AMW)/(USA) will create an airline with the best domestic feed of the USA’s three mega-carriers and will make Oneworld (ONW) the strongest of the global alliances, (AMW)/(USA) President, Scott Kirby said.
May 2013: Oneworld (ONW) Alliance (CEO), Bruce Ashby believes the new cooperation between Qantas (QAN), a founding alliance member, and non-alliance member Emirates (EAD), will not hurt other alliance partners such as American Airlines (AAL) or British Airways (BAB).
September 2013: (LAN) Colombia (AIR) will join the Oneworld (ONW) Alliance from October 1, the first of the merged (LATAM) (LAN)/(TPR) airlines to join the alliance.
The (LATAM) Airlines Group, parent of Brazil’s (TAM) (TPR) and Chile’s (LAN) Airlines, announced in March it had chosen membership in the Oneworld (ONW) over the Star (SAL) Alliance for both carriers.
(LAN) Airlines, which has been a full member of the Oneworld (ONW) Alliance since 2000, merged with (TAM) Airlines (TPR) in 2011. (TAM) (TPR) was a member of the Star (SAL) Alliance. Chilean antitrust authorities required (LATAM) to leave one of the alliances when it approved the merger.
All other passenger airline affiliates of (LAN) Airlines have joined the Oneworld (ONW) alliance as affiliate members, subsequently (LAN Argentina (LNR), LAN Ecuador (LNE) and LAN Peru (LPU)) apart from (TAM) (TPR), which will transition to the Oneworld (ONW) Alliance from the Star (SAL) Alliance in the second quarter of 2014, as announced in March. (LAN) said that dates for the switch will be announced “in due course.” (TAM)'s Paraguayan affiliate (TAM) Mercosur (LAP) will also become part of the Oneworld (ONW) Alliance.
“With the other airlines lining up to join the Oneworld (ONW) Alliance in the coming months, the (ONW) alliance's network will expand to almost a thousand destinations in more than >150 countries served by a combined fleet of 3,300 airplanes operating 14,000 daily departures, carrying 480 million passengers a year and generating annual revenues of $140 billion,” (AIR) said.
(LAN) Colombia (AIR), launched in 2011, serves 23 airports in three countries with a fleet of 24 airplanes (including 767s and 737s, A320s and Bombardier DHC-8-200s) operating 130 departures a day. It boarded 3.7 million passengers in 2012.
The Oneworld (ONW) Alliance has confirmed that Qatar Airways (QTA) will become a full member of the alliance on October 30, just one year after (QTA) was invited to join. The transition has involved (QTA) setting up working groups spanning 20 streams of activity. (QTA) is now finalizing a number of projects aimed at bringing its various internal processes and procedures into line with alliance requirements. After clearing an audit performed by sponsoring carrier British Airways (BAB), (QTA) has received the "all-clear."
“Qatar Airways (QTA) completed its Oneworld (ONW) Alliance implementation program just one year after receiving its invitation to join, announced at a press conference in (ONW)'s New York home in October 2012. This will make its induction into (ONW) as one of the fastest in the alliance's history. Normally it takes around 18 months for any airline to be readied to enter any alliance.”
The Oneworld (ONW) Alliance comprises airberlin (BER), American Airlines (AAL), British Airways (BAB), Cathay Pacific Airways (CAT), Finnair (FIN), Iberia (IBE), Japan Airlines (JAL)/(JAS), (LAN) Airlines, Malaysia Airlines (MAS), Qantas (QAN), Royal Jordanian (RJA), and S7 Airlines (SBR).
(QTA), which code shares with American Airlines (AAL) and Malaysia Airlines (MAS), will add more than +>20 new destinations and five countries to the (ONW) map. It is the first major Gulf carrier to enter into one of the three global alliances.
October 2013: Qatar Airways on October 29th became the 13th member of the Oneworld (ONW) Alliance and the first major Gulf carrier to join a global alliance. In a signing ceremony in Doha, (QTA)’s (CEO), Akbar Al Baker said Oneworld (ONW) Alliance membership is a win for the alliance, for Qatar and for (QTA)’s customers. “We are convinced that the time is right to join a global alliance group and the Oneworld (ONW) Alliance is clearly the best,” Al Baker said.
(QTA), which is just 16 years old, adds 21 new cities to the (ONW) Alliance, bringing the (ONW) alliance’s number of destinations to more than >900. It will increase (ONW)’s total (RPK)s by +3.3% and (RPK)s in the Middle East region by +90%.
British Airways (BAB) was the sponsor for (QTA)’s membership and the induction process was completed within one year, the quickest ever. (IAG) (CEO), Willie Walsh said (QTA)’s membership was “without question the most significant and positive event in (ONW) for a long time.”
Al Baker said that as a young carrier, he wanted to wait and be sure to select the best alliance for (QTA) and the alliance for which (QTA) could bring the most benefit. “We wanted to be a part of a high-class alliance so when we were invited [to join (ONW)] we very quickly accepted and we assured our (ONW) partners that we will never fail them,” he said.
(QTA)’s membership comes at an interesting time for (ONW) and the major Gulf carriers. Qantas (QAN), a Oneworld (ONW) Alliance founding member, has formed a five-year alliance with Emirates (EAD). Airberlin (BER) joined (ONW) March 2012 and has a strategic alliance with Etihad (EHD), which has a 29% stake in (BER).
Oneworld (ONW) Alliance (CEO), Bruce Ashby said that one of the reasons the (ONW) alliance is now growing so fast is because it does not believe in preventing its members from forging their own bilateral relationships. “(ONW) has adopted a flexible approach to bilateral relationships,” he said. “We believe that an alliance that prevents its customers from doing what’s best for their business should go the way of the dinosaur.”
Ashby added, “Qantas (QAN) is very much a member of the Oneworld (ONW) Alliance and will continue to be so.”
The signing ceremonies were held at Doha’s new $15.5 billion Hamad International Airport, which has capacity for 28 million passengers a year and an approved plan to grow that to 50 million. Although the airport looks ready for service, an opening date has not yet been given.
While the arrival of Qatar Airways (QTA) brings a relatively small 21 new destinations in five countries to the Oneworld (ONW) network, the significance and symbolism of the addition of (QTA) to the global alliance stretches far wider.
Oneworld (ONW)'s latest and 13th airline member is not the first from the Middle East to join an alliance. Indeed, (ONW) already has one carrier from the region, Royal Jordanian (RJA), among its membership. But it is the first of the big three Gulf carriers to join one of the global groupings.
Many of the rifts between legacy airlines from the traditional hierarchy and the aggressively expanding Gulf rivals already appear to be on the mend. Qantas (QAN) has teamed up with Emirates (EAD) in a bid to revive its international business, while Air Canada (ACN) and AirFrance (AFA)-(KLM) are embracing Etihad (EHD) through wide-ranging code shares, where once they complained.
But none have gone as far as (QTA) to embed themselves in the mainstream by joining one of the alliances. For (QTA) (CEO), Akbar Al Baker, membership of Oneworld (ONW) is a further sign of changing attitudes. This is such a global industry that you cannot isolate pockets. This perception from [some] carriers in Europe [towards Gulf airlines] is changing. I don't think they see us in the negative way today they used to.
"There could be concern from some European carriers, but not Oneworld (ONW) carriers. I assume each of these remaining alliances will be knocking on the door of the Gulf carriers." He added, in typically bullish fashion: "They have missed the best one."
Certainly the significance of (QTA) joining is not lost on one of (QTA)'s chief advocates within the alliance. Willie Walsh, (CEO) of the (IAG) (whose British Airways (BAB) unit sponsored (QTA) joining process was effusive in his praise of the airline and its larger-than-life leader).
"I've been fan of what Akbar has achieved here," he said, pointing to how (QTA) and the other Gulf giants have become "significant players" in the industry. "We have embraced them and they have demonstrated they have a significant role to play. We would not be here today if we did not believe it was a significant and positive development. I believe it's one of the most significant and positive developments for Oneworld (ONW) in a long time.
"Our strategy for the region [Middle East] is the same as all other regions: identify the best airline to meet our exacting requirements. The Gulf carriers have been embraced by consumers. (ONW) does not see why consumers that fly with these carriers should not get the benefits (ONW) can provide."
(ONW) (CEO) Bruce Ashby points to the "very attractive" network (QTA) brings to (ONW), noting it is complementary to the existing partners' networks. Specifically he said while the (ONW) alliance is strong on many key market flows (such as Europe to the USA or Latin America) (QTA) brings new strength to is network in the Middle East, Africa and the Indian subcontinent.
Certainly there is little crossover in network. Just two (ONW) carriers ((BAB) and Royal Jordanian (RJA) serve Doha. (QTA) meanwhile serves Hong Kong, Kuala Lumpur, London Heathrow, Madrid, New York (JFK) and Tokyo today. New USA flights next year to Miami and Philadelphia tie in with American (AAL) and US Airways (AMW)/(USA) hubs (if the latter joins) while it also serves the Colombo and São Paulo homes of future (ONW) carriers, SriLankan Airlines (LNK) and (TAM) (TPR).
(QTA) is one of the key parts of (ONW)'s busiest recruitment drive. Malaysia Airlines (MAS) and (LAN) Colombia (AIR) have already joined this year. (TAM) (TPR) will join in March next year following its merger with Lan Air (LAN), SriLankan Airline (LNK) will follow around the same time, and if with the merger with (AAL) now going through, US Airways (AMW)/(USA) will follow (TAM) (TPR) in switching from the Star (SAL) Alliance to (ONW).
"(ONW) will have increased its scope more than >50% by almost every measure," Walsh notes, since Air Berlin (BER) joined in the spring of last year. If new members join, it will take (ONW) destinations from around 900 to nearly 1,000.
There were plenty of echoes of (BER)'s membership in (QTA)'s joining ceremony. Like (BER) last year, (QTA) used the occasion to showcase its new home, in this case Doha's Hamad International airport. Like (BER), the new home is needed to ease the overstretched airport infrastructure. And like Brandenburg airport, the new home was meant to be open by now.
Air Berlin (BER) brought (ONW)-adorned airplanes to Brandenburg to mark its big day, yet 18 months later this has proved something of a one-off with no firm launch date for its full opening yet.
(QTA) did likewise at its new Hamad home at the joining ceremony. Al Baker would not be drawn on an opening date beyond the early 2014 indication recently given by Qatar's Transport Minister. Given the arrival of its first Airbus A350 and A380 airplanes next year, (QTA) will be hoping the similarities with the experience of its new German (ONW) partner end there.
Responding to questions amid rumors over whether he would remain in charge to oversee the next stage in the airline's journey following this summer's change in leadership of Qatar, the long-serving Al Baker said: "The enemies of Qatar Airways (QTA) always have wishful thinking that I am leaving. I am a soldier of my government, and as long as my ruler requires me to be in (QTA), I will be. The decision for me to stay or leave is dependent on my ruler."
December 2013: Oneworld (ONW) alliance carrier, Qatar Airways (QTA) is to open a new USA connection with non-stop daily services to Dallas-Fort Worth from the beginning of July next year. (QTA) will serve the route, its second in Texas after Houston, with Boeing 777-2D7LR twinjets. The airplane will be configured in two classes, it states, with 42C business- and 217Y economy-class seats. The route will tighten its links with Oneworld (ONW) Alliance carrier American Airlines (AAL).
(QTA) operates to four USA cities, comprising New York, Washington DC, Chicago, and Houston. Dallas will increase this to seven, because (QTA) is also planning to operate to Philadelphia from April 2014 and Miami from June 2014.
January 2014: The Star (SAL) Alliance maintained its position as the largest airline alliance in 2013 with 26.6% of total scheduled traffic in revenue passenger kilometers (RPK), followed by the SkyTeam (STM) Alliance (20.1%), and the Oneworld (ONW) Alliance (15.4%).
The International Airlines Group (IAG) Cargo will end its arrangement with Global Supply Systems (GSS), which operated three Boeing 747-8F freighters on its behalf. The move comes after British Airways (BAB), which formed (IAG) Cargo with Iberia (IBE)’s freight division, decided to pull out of the dedicated freighter airplane market.
Alas Air Worldwide Holdings (TLS) said British Airways (BAB) had terminated the lease agreement ahead of schedule. (TLS) shares fell as much as -19% in early trading on January 17th. (TLS) said the lease for three 747-8F airplanes operated by (TLS)'s UK subsidiary, Global Supply Systems (GSS) was terminated, following British Airways (BAB)'s decision to exit dedicated cargo-freighter service.
(GSS) was operating the three 747-8F airplanes for (BAB) and the lease agreement was originally scheduled to end in April 2014.
Atlas Air (TLS) said it would receive early termination fees from British Airways (BAB). (GSS) will redeliver the 747-8Fs to Atlas Air (TLS).
(IAG) Cargo will retain a dedicated cargo service, a 5x-weekly, London - Hong Kong route, which will be operated by Qatar Airways (QTA) Boeing 777Fs. British Airways (BAB), Iberia (IBE) and (QTA) are members of the Oneworld (ONW) alliance. “This new partnership is an important step forward for us and enhances our relationship with (QTA),” (IAG) (CEO), Willie Walsh said. “It allows us to continue delivering significant capacity for our customers through the important gateway of Hong Kong. With the ongoing arrival of our next generation airplanes, (IAG) Cargo’s customers will now benefit from increased belly-hold capacity as well as the deployment of freighter services on capacity constrained routes.”
Finnair (FIN) is considering using Vienna as a hub to leisure destinations in Southeastern Europe, connecting with Oneworld (ONW) Alliance affiliate member and airberlin (BER) subsidiary, FlyNiki (NKI).
(FIN) Director Central Europe, Jan Pellinen said in Vienna (FIN) has not considered the Austrian market over the last few years due to its restructuring, “but now we want to invest in our presence here again. The idea is to use Vienna as a connecting point to FlyNiki (NKI) leisure routes.”
(ONW) Alliance member, Finnair (FIN) operates 2x-daily, Helsinki - Vienna flights. FlyNiki (NKI) has established a hub in Vienna to destinations such as Greece, connecting with airberlin (BER). “Our hub operation works very well. On routes to leisure destinations like to Greece, we enjoy load factors of more than >90%,” (NKI) (CEO), Christian Lesjak said.
Vienna International Airport last year opened the first phase of its dedicated terminal for airberlin (BER) and subsidiary, FlyNiki (NKI), as well as for its Oneworld (ONW) alliance partners.
Pellinen also said Finnair (FIN) can invest in markets again and has “increased our flights from Dusseldorf as well as from Zurich to Helsinki from double daily to 4x-daily flights.”
In addition, Helsinki airport is undergoing a major €900 million/$1.2 billion investment, which includes a new premium lounge.
Finnair (FIN) is working to establish a third bank (a third wave for takeoffs and departures) at its Helsinki hub. Its two banks, which currently operate at 5 pm and about midnight, are already operating at high levels, connecting Europe with its 13 destinations in Asia.
March 2014: SriLankan Airlines (LNK) will become a full member of the Oneworld (ONW) Alliance on May 1, becoming the first carrier from the Indian subcontinent to become part of any global airline alliance.
(LNK) received clearance to join the Oneworld (ONW) Alliance after completing a thorough review of its readiness conducted by Cathay Pacific Airways (CAT), which is sponsoring its entry into the (ONW) alliance.
According to Oneworld (ONW), (TAM) (TPR) Airlines and US Airways (AMW)/(USA) (now merged with American Airlines (AAL)) are on track to join the alliance on March 31.
International Airlines Group (IAG) (CEO), Willie Walsh has been nominated to become Chairman of the Oneworld (ONW) alliance. Walsh succeeds American Airlines (AAL) Chairman, Tom Horton, who has been the Oneworld (ONW) Chairman since December 2011. (IAG) carriers British Airways (BAB) and Iberia (IBE) are (ONW) Alliance members. (ONW) Alliance said that Walsh “will act as ‘first among equals’ of the (CEO)s of (ONW) Alliance member airlines.”
Oneworld (ONW) Alliance (CEO), Bruce Ashby said, “We thank Tom Horton sincerely for his leadership of oneworld during a period of unprecedented growth for the (ONW) alliance and at a time when his own (AAL) has been undergoing its merger with US Airways (AMW)/(USA). We are fortunate to have, in Willie Walsh, a man with the vision, determination and overall skills and capabilities to lead us forward in the next phase of our journey.”
US Airways (AMW)/(USA) and Brazil’s (TAM) (TPR) have both officially joined the Oneworld (ONW) alliance, greatly expanding the global airline grouping’s network in the Americas.
The two carriers exited the Star (SAL) Alliance at the end of the day on March 30 and officially began services as Oneworld (ONW) Alliance members on the morning of March 31. The alliance switch was driven by mergers: (TAM) (TPR)’s with (ONW) member (LAN) Airlines in June 2012 to form the (LATAM) Airlines Group, and US Airways (AMW)/(USA) with (ONW)’s American Airlines in December 2013.
“The addition of (TAM) (TPR) and US Airways (AMW)/(USA) represents the biggest single day of growth since the (ONW) alliance started 15 years ago,” International Airlines Group (IAG) (CEO) and new Oneworld (ONW) Alliance Chairman, Willie Walsh said. “We believe it is the single biggest day of growth for any of the alliances. Brazil is one of the most important markets for all airlines. We know in Brazil, we now have a partner with an excellent network.”
(TAM) (TPR) and US Airways (AMW)/(USA) add nearly 100 destinations to the (ONW) Alliance’s network; 45 operated to by (TAM) (TPR) and more than >50 operated to by US Airways (AMW)/(USA). Walsh noted the (ONW) alliance’s worldwide network now reaches 1,000 destinations.
American Airlines (AAL) (CEO), Doug Parker called the entrance of US Airways (AMW)/(USA) into the (ONW) Alliance “another crucial step towards our progress to integrating (AAL) and US Airways (AMW)/(USA) into a single carrier.” He added that having the entire (LATAM) Airlines Group in the (ONW) Alliance was significant for the new (AAL), noting that (AAL) and (LATAM) code share across 150 destinations. Brazil is one the “most important” international markets served by (AAL), Parker said.
(TAM) (TPR) (CEO), Marco Bologna said the Brazilian carrier’s entrance into the (ONW) Alliance means it has become “aligned with the best airlines in terms of reach worldwide,” highlighting connectivity at (AAL)’s USA hubs, especially Miami International Airport. With (TAM) (TPR)’s entrance, (ONW) becomes “the leading alliance in Latin America,” he said.
(ONW) (CEO), Bruce Ashby noted, “As the leading airline in Latin America’s biggest economy, (TAM) (TPR)’s addition represents a significant landmark.”
Bologna added, “(TAM) (TPR) is one of the fastest growing airlines in the Americas. [By joining Oneworld (ONW)], we are taking a very important step for the future of (TAM) (TPR) and (LATAM).”
April 2014: SriLankan Airlines (LNK) has formally joined the Oneworld ((ONW) Alliance during a ceremony at Mattala Rajapaksa International Airport (HRI), marking it the first carrier from the Indian subcontinent to join an alliance.
The membership will formally take effect at midnight April 30; its first (ONW) Alliance flight will depart Colombo for Kuala Lumpur on May 1.
With (LNK) joining the (ONW) Alliance, which was sponsored by Cathay Pacific Airways (CAT), (ONW) will add two new destinations to its network: Hambantota in Sri Lanka (served by (HRI)) and Tiruchirappalli in India. SriLankan (LNK) flies to 32 destinations in 20 countries.
SriLankan (LNK) (CEO), Kapila Chandrasena said the (ONW) Alliance gives (LNK) an opportunity to expand to areas that are not commercially viable to operate with its own airplanes. “Why the Oneworld (ONW) Alliance? We saw it as the best fit. When we studied the alliances we felt that there was a vacuum in the (ONW) Alliance network, especially in southern India, the Maldives and South Asia, where we have a strong network. Plus, the commercial terms of the (ONW) Alliance were much more suitable for us,” he said.
Chandrasena added that (LNK) expects to deliver about $25 - $30 million worth of revenues to the (ONW) alliance and to gain about the same in return.
Cementing its membership, (LNK) has also finalized code shares with two more (ONW) Alliance carriers: Finnair (FIN) and S7 Airlines (SBR), joining its existing partnership with Malaysia Airlines (MAS).
SriLankan (LNK) and S7 (SBR) agreed to code share last year. Regulatory approval has just been granted and the agreement will become effective May 15. (LNK) will add S7 (SBR)'s designator to Colombo-originating services to Bangkok and Moscow Domodedovo, while S7 (SBR) will add SriLankan (LNK)’s code to its services from Moscow Domodedovo to Chelyabinsk, Irkutsk, Novosibirsk, St Petersburg, Volgograd, and Yekaterinburg.
The deal with Finnair (FIN) will take effect from June 2, with (FIN) placing its code on (LNK)’s Bangkok, Frankfurt, Hong Kong, London Heathrow, Paris Charles de Gaulle, and Rome flights. In exchange, SriLankan (LNK)’s code will be added to Finnair (FIN)’s services from Helsinki to Copenhagen, Frankfurt, London Heathrow, Paris Charles de Gaulle, Oslo, Stockholm, and Rome.
The Oneworld (ONW) Alliance said code share discussions between SriLankan (LNK) and its other members are at an advanced stage. The (ONW) alliance now covers more than >500 million passengers annually, representing about $140 billion in revenues. Its network spans almost 1,000 airports in 150 countries.
“Although we are No 2 in terms of revenue share, the numbers are so close, we are actually only one large member away from the top spot,” Oneworld (ONW) Alliance (CEO), Bruce Ashby said.
June 2014: British Airways (BAB) and Qatar Airways (QTA) are believed to be in the early stages of studying ways to increase levels of cooperation beyond their current code share links as part of the Oneworld (ONW) Alliance.
Qatar Airways (QTA) (CEO), Akbar Al Baker was asked by Richard Quest of (CNN) if he was interested in some form of joint venture (JV) with British Airways (BAB). “Why not?” Al Baker replied.
This was followed by a report in the Abu Dhabi newspaper, "The National," which quoted (BAB) parent, the International Airlines Group (IAG) (CEO) & (ONW)Alliance Chairman, Willie Walsh as saying that various forms of potential cooperation were being studied. “We look at various different structures of joint ventures (JV)s. You can have a revenue share, you can have a profit share, you can have things that fall between the middle. This is all the sort of issues that are subject to discussions between us. It won’t necessarily have to mean a profit share, but we will have discussions about these issues in the right time.”
Asked to confirm (BAB)’s interest, an (IAG) spokeswoman said: “(QTA) is already a partner of (IAG) through the (ONW) Alliance, which it joined in October 2013. We will look at other opportunities to develop our commercial relationship.”
January 2015: News Item A-1: Qatar Airways (QTA) has acquired a 9.99% stake in British Airways (BAB)/Iberia (IBE)/Vueling (VUZ) parent company, the International Airlines Group (IAG).
(QTA) said the move was “part of efforts to enhance operations and strengthen existing commercial ties initiated through code share agreements with the (IAG) as well as its membership of the Oneworld (ONW) Alliance.”
Qatar Airways (QTA) (CEO), Akbar Al Baker said: “The (IAG) represents an excellent opportunity to further develop our Westward strategy. Having joined the Oneworld (ONW) Alliance, it makes sense for us to work more closely together in the near term, and we look forward to forging a long-term relationship.”
The (IAG) concurred it already had a close relationship with (QTA) through the (ONW) Alliance and welcomed (QTA)’s commitment to strengthening existing commercial ties.
(IAG) (CEO), Willie Walsh said the company will “talk to them about what opportunities exist to work more closely together and further (IAG)’s ambitions as the leading global airline group.”
As a non-European Union (EU) shareholder, (QTA) is subject to an overall cap on ownership in the (IAG) as a result of the requirement for (EU) airlines to be majority owned by (EU) shareholders. However, (QTA) said it “may consider increasing its stake further over time, although this is not currently intended to exceed >9.99%.”
News Item A-2: Qatar Airlines (QTA) & the (IAG): "Shifting sands in the global reach of the Gulf carriers" January 30, 2015 by Karen Walker in (ATW) Editor's Blog:
The announcement that Qatar Airways (QTA) has acquired a 9.99% stake in (BAB)/(IBE) parent company, the International Airlines Group (IAG) is an interesting development in the ongoing change in the international airline landscape prompted by the growth of the Gulf carriers.
(QTA) (CEO), Akbar Al Baker describes the taking of a stake in the (IAG), worth about $1.7 billion, as an “excellent opportunity to further develop our Westward strategy.” (IAG) (CEO), Willie Walsh said he was “delighted” about the investment, and opportunities to work more closely with (QTA).
There’s an interesting history to the (IAG) and (QTA) connection. Al Baker and Walsh are long-time, firm friends who each hold the other in high respect. In October 2013, (QTA) joined the Oneworld (ONW) global alliance, becoming the first of the major Gulf carriers to join a global alliance. British Airways (BAB), a founding (ONW) member, was (QTA)’s sponsor and Walsh spoke very enthusiastically about the importance of having (QTA) join. My understanding is that his enthusiasm was not matched by every (ONW) member (CEO).
Dubai-based Emirates (EAD), meanwhile, remains alliance-independent, but in 2013 it entered a five-year alliance with Qantas (QAN), another Oneworld (ONW) Alliance founding member. And Abu Dhabi-based Etihad Airways (EHD) owns a 29% stake in airberlin (BER), another (ONW) airline. (EHD) has its own version of an alliance, taking stakes in relatively small carriers and creating a constellation of airline equity partners that includes airberlin (BER), Air Serbia (JAT), India’s Jet Airways (JPL), Virgin Australia (VOZ), Air Seychelles (ASY) and Aer Lingus (ARL). Interestingly, the (IAG) wants to buy Aer Lingus (ARL), a move, which if it happens, would further tangle the (IAG)-Oneworld (ONW)-Gulf carrier web.
(EHD), of course, is also now a 49% owner of Alitalia (ALI) (to keep you on track with the alliance matings here, (ALI) is a SkyTeam (STM) Alliance member). But (QTA)’s stake in the (IAG) is the first time that one of the “Big Three” Gulf carriers has invested in one of the “Big Three” European airline groups of the (IAG), the Lufthansa Group and Air France (AFA) - (KLM).
It will be fascinating to see if the (QTA) - (IAG) deal marks the beginning of more such equity partnerships (within the caps of the (EU) airline ownership rules) between Gulf carriers and their European counterparts. The fact is that it’s becoming increasingly challenging for the “traditional” global hubs of Amsterdam, Frankfurt, Heathrow, and Paris to compete with the “modern” world hubs of Abu Dhabi, Dubai, and Qatar.
In the USA, meanwhile, there is growing awareness that what happened in Europe regards Gulf competition could happen in America. A campaign is being run by North America’s “Big Three” (American Airlines (AAL), Delta Air Lines (DAL) and United Airlines (UAL)) to try and get lawmakers to review "Open Skies" policies and the international air transport competitive landscape to take account of the rise of the Gulf carriers.
Flying under the radar so far in the shifting sands of air transport power houses is Turkish Airlines (THY), which is a Star (SAL) Alliance carrier and which has developed an extensive network, very large and modern fleet and highly successful global hub in Istanbul. It will be interesting to see whether that continues to be the case if, as Al Baker described it, a “Westward strategy” by Gulf carriers begins, in some eyes at least, to look more like a "Westward" invasion.
March 2015: News Item A-1: British Airways (BAB) commenced a 4x weekly service to the Spanish city of Seville (SVQ) from its London Gatwick (LGW) base on February 26th. Operated by the (IAG) airline’s 737-400s, the 1,588 km sector faces direct competition from easyJet (EZY) (5x weekly), as well as the indirect threat posed by Ryanair (RYR)’s daily services from London Stansted. Seville joins the Oneworld (ONW) Alliance carrier’s Spanish gateways of Alicante, Malaga, Barcelona, Tenerife South, Lanzarote, and Fuerteventura, currently served from its Gatwick operation.
News Item A-2: (TAM) Airlines (TPR) increased its domestic offering with the addition of a new route from Brasilia (BSB) to Boa Vista (BVB), the capital of the Brazilian state of Roraima, on March 1st. The 2,507 km domestic sector will be served six times weekly, utilizing the Oneworld (ONW) Alliance member’s 174Y-seat A320s. (TAM) (TPR) is also flying to Boa Vista five times weekly from Manaus. No other airline operates on (TAM)’s new addition.
June 2015: News Item A-4: Cathay Pacific (CAT) (CEO), Ivan Chu will serve as Oneworld (ONW) Alliance governing board Chairman for the year ahead, succeeding (IAG) (CEO), Willie Walsh.
Ivan Chu said he looked forward to “working with other board members to drive continuous developments of the Oneworld (ONW) Alliance. We will never rest on our laurels. We will keep working to provide a seamless travel experience for the millions of customers who fly with (ONW) every year.”
(ONW) (CEO), Bruce Ashby said: “We thank Willie Walsh for his leadership of (ONW) as the alliance completed its biggest yet membership expansion and welcome Ivan Chu as his successor, as we move ahead on the next phase of our journey to establish (ONW) firmly as the first choice alliance for frequent international travelers the world over.”
Chu was appointed Cathay Pacific (CAT) (CEO) in March 2014 after serving as (COO) for three years. He is also Chairman of Hong Kong Dragon Airlines (DRG) Limited (which is an affiliate member of (ONW)) and a director of John Swire & Sons (HK) Limited and of Swire Pacific Limited.
He joined the Swire group, which is (CAT)'s main shareholder, in 1984 and worked with the group in Hong Kong, Mainland China, Taiwan, Thailand, and Australia.
News Item A-2: "American Airlines (AAL), Qantas (QAN) Step Up Partnership with New Transpacific Routes" by (ATW) Editor, Karen Walker, June 9th, 2015.
American Airlines (AAL) and Qantas Airways (QAN) are expanding their joint business by adding new service between the USA and Australia.
(AAL) will begin operating a daily, nonstop flight between Los Angeles and Sydney from December 17, while (QAN) will begin Sydney to San Francisco from December 20.
Services will initially operate on peak days and ramp up to 6x-weekly in January 2016. The two Oneworld (ONW) Alliance airlines said their closer and more integrated relationship also provides opportunities for future growth in the transpacific markets not currently served by either airline, such as New Zealand.
(AAL)’s new service between Los Angeles and Sydney will be operated with three-class Boeing 777-300ERs.
(QAN) will operate its service between Sydney and San Francisco with a reconfigured Boeing 747-400 fitted with the same style interiors found on its Airbus A380 airplanes.
(AAL) Chairman & (CEO), Doug Parker and (QAN) (CEO), Alan Joyce both talked at the press conference of further growing their business relationship, although Joyce joked, “I am not sure that we can have a striped kangaroo.”
But Joyce said the USA market was (QAN)’s largest international market with some 40% of its overseas business invested there. “We could not have such a large network in the USA without American,” he said. “With this partnership, anything is possible.”
Joyce also noted that the strong relationship with (AAL) did not affect (QAN)’s partnership with Emirates (EAD), even though (AAL) is one of the USA carriers involved in the alleged subsidy fight against the Gulf carriers. He said (EAD) had significantly enhanced (QAN)’s reach into Europe. “We have great relationships with both (EAD) and (AAL) and that will continue,” Joyce said.
December 2015: Global Explorer, the round-the-world fare offered by Oneworld (ONW) Alliance member airlines and selected partners outside the global alliance, has been added to the networks of Jetstar Asia (JSA), Jetstar Japan (JJP), and Jetstar Pacific (PAH). Jetstar’s Australian airline (IMU) already participates in the fare. The addition of these three carriers’ routes, effective December 1, adds more than >15 new destinations, two key Asian hubs (in Ho Chi Minh City and Singapore) and dozens more routes on board "Global Explorer."
This means Global Explorer now features some 230 destinations across Asia (and around 1,150 worldwide, in more than >150 countries).
January 2016: News Item A-1: "(LATAM) Seeks Antitrust-immunized Joint Ventures (JV)s with American (AAL) and the (IAG)" by (ATW) Aaron Karp, January 14, 2016.
The (LATAM) Airlines Group is seeking to form separate joint ventures (JVs) with American Airlines (AAL) and the International Airlines Group (IAG) for travel between North and South America, and between South America and Europe, respectively.
(AAL) and (LATAM), parent to Brazil’s (TAM) (TPR) and Chile’s (LAN) Airlines (as well as affiliated carriers throughout South America), said they will apply for antitrust immunity (ATI) with the USA Department of Transportation (DOT) and the relevant regulatory authorities in South America. Similarly, (LATAM) and the (IAG), the parent of British Airways (BAB) and Iberia (IBE), said they have signed “a joint business agreement” for the operation of “flights between Europe and South America.”
(LAN), (TAM), (AAL), (BAB) and (IBE) are all members of the Oneworld (ONW) alliance. (AAL), (BAB), (IBE) and Finnair (FIN) already operate an antitrust-immunized transatlantic (JV).
The (IAG) said in a statement that (LATAM), (BAB) and (IBE) “plan to seek approval from the appropriate competition authorities in South America and will inform the regulatory authorities in the European Union (EU),” adding, “Under the joint business, (BAB), (IBE) and the (LATAM) Airlines Group would cooperate commercially on flights between the European Union (EU) and South America. They would expand their code share arrangements on flights between and within Europe and South America, significantly increasing the number of destinations that the airlines can offer customers.”
(IAG) (CEO), Willie Walsh hinted at a potential (IAG)-(LATAM) (JV) in December, telling the Aviation Club of the UK that the (IAG) “would like to have closer ties to” (LATAM).
(LATAM) (CEO), Enrique Cueto called the potential (JV)s with (AAL) and the (IAG) “excellent news for Latin America,” adding, “Through these two agreements, we seek to significantly improve the benefits to our clients by providing them with greater connectivity between South America and the USA/Canada and also between South America and Europe. This step is necessary to offer the best network of connections for everyone in Latin America and increases the possibility of adding new routes and direct flights to new destinations, as well as flights already operated by (LATAM) and affiliates in the future.”
(AAL) Chairman & (CEO), Doug Parker said, “Customers will benefit from more frequent and convenient schedule options than the carriers could offer individually. Travelers headed to Latin America will soon have more seamless access to more than >100 additional destinations with (LATAM) beyond (AAL)’s already extensive network.”
Walsh added, “We already have a close commercial relationship with the (LATAM) Airlines Group as part of the Oneworld (ONW) Alliance and we look forward to enhancing the relationship further. This joint business would benefit customers by providing them with easier journeys to more destinations with better aligned schedules and increased frequencies. This would boost both tourism and business travel between South America and Europe.”
(LATAM) emphasized that it, (AAL) and the (IAG) “will continue to operate independently and maintain control of their respective operations,” adding, “These agreements will not cause any changes to the ownership or administration of the airlines.”
News Item A-2: After five years as (CEO) of the Oneworld (ONW) Alliance, Bruce Ashby has resigned and will leave the alliance later this year. “After five years in this role it makes sense for me to move on at this time,” Ashby said, announcing his departure on January 22.
The (ONW) governing board has accepted Ashby’s resignation and has started an internal and external selection process to identify his successor. Ashby has made himself available until June to ensure a smooth handover.
Oneworld (ONW) Alliance Chairman and Cathay Pacific (CAT) (CEO) Ivan Chu credited Ashby with having led the (ONW) alliance through “a period of tremendous transformation” and growth, adding more than >15 carriers as full or affiliate members.
Under Ashby’s leadership, (ONW) expanded its capacity by almost +60% and posted a +75% boost in passenger numbers. He also oversaw the (ONW) alliance’s relocation from Vancouver to New York.
Before joining (ONW) in 2010, Ashby was (CEO) of Indian carrier IndiGo (IGO) and Saudi Arabian start-up SAMA Airlines. He has also held senior positions with US Airways (USA), United Airlines (UAL) and Delta Airlines (DAL).
Oneworld (ONW)’s members include airberlin (BER), American Airlines (AAL), British Airways (BAB), Cathay Pacific (CAT), Finnair (FIN), Iberia (IBE), Japan Airlines (JAL)/(JAS), (LAN) Airlines, (TAM) Airlines (TPR), Malaysia Airlines(MAS), Qantas (QAN), Qatar Airways (QTA), Royal Jordanian (RJA), (S7) Airlines (SBR) and SriLankan Airlines (LNK), and around 30 affiliates.
August 2016: Emirates Airline (EAD executive Rob Gurney replaces Bruce Ashby as the (CEO) of the global airline Oneworld (ONW) Alliance.
April 2017: Oneworld (ONW) Alliance members Iberia (IBE) and Qatar Airways (QTA) have begun code share flights offering passengers more flight options to/from Doha and Spain and Portugal.
According to the agreement, (ibe), the Spanish flag carrier is marketing the 2 daily flights operated by Doha-based (QTA) between Madrid and Doha under its IB designator code. Qatar Airways (QTA)’s QR code has been added to (IBE) flights from Madrid to 28 destinations in Spain and Portugal.
Qatar Airways Group (CEO) Akbar Al Baker said code share partnerships and airline alliances “continue to play an important role for (QTA). In linking (IBE)'s extensive network across Spain and Portugal with Qatar (QTA)’s global network of >150 destinations, passengers will benefit from seamless connectivity and the growing strength of the (ONW) global network.”
May 2017: Oneworld (ONW) Alliance member Airberlin (BER) launched 3x-weekly Berlin Tegel - Los Angeles (LAX) services on May 16, just weeks after Star (STM) Alliance members Austrian Airlines (AUL) and (LOT) Polish Airlines started services to (LAX) from Vienna and Warsaw. (BER) operates an Airbus A330-200 on the flight.
“This new long-haul flight from Berlin to Los Angeles is the next step in (BER)’s new strategic policy,” (BER) (CEO) Thomas Winkelmann said.
At the end of May, (BER) will begin services from Berlin-Tegel to San Francisco, California.
During the current summer schedule, (BER) offers 33x-weekly USA services from Berlin-Tegel to New York (JFK), Miami, Chicago O’Hare, Los Angeles and San Francisco.
On March 26, (BER)’s USA partner American Airlines (AAL) ended its code share arrangement with (BER), Germany’s 2nd largest carrier; however, an interline agreement still exists between the 2 airlines.
June 2017: News Item A-1: Finnair (FIN) (CEO) Pekka Vauramo is to chair the governing board of the Oneworld (ONW) alliance for the coming 2 years. Vauramo took up the role at (ONW)’s mid-year board meeting, held on the sidelines of the (IATA) (AGM) in Cancun, Mexico.
He takes over the Chairmanship of former Cathay Pacific (CAT) (CEO) Ivan Chu, who has since moved to another role and been succeeded by Rupert Hogg. Vauramo will chair Oneworld (ONW) board meetings, oversee alliance governance and work closely with (ONW) (CEO) Rob Gurney and the central alliance team.
He has been (FIN) (CEO) since 2013, leading (FIN)’s turnaround and growth strategy. He previously served with Finnish cargo and load handling company Cargotec and with Sandvik, the Swedish mining and construction company, in various senior management positions.
Oneworld (ONW)’s member airlines carry 550 million passengers a year across their fleet of 3,500 aircraft, generating $130 billion in annual revenues.
News Item A-2: "Etihad, (TUI) Group Calls Off Plans for New Leisure Airline" by Kurt Hofmann email@example.com, June 8, 2017.
The Etihad (EHD) Aviation Group and German holiday company the (TUI) Group have ended plans to establish a new European leisure airline group. “I can confirm that negotiations on this project, which have been on hold since the end of 2016, have ended.”
In October 2016, the partners detailed plans to combine the leisure operations of the airberlin (BER) group and German carrier (TUI)fly (HAP)/(HLX) into a new airline group, serving destinations from Austria, Germany and Switzerland. (BER) was expected to operate 58 aircraft on point-to-point services to key tourist markets.
The Etihad Aviation Group also confirmed it terminated negotiations with the (TUI) Group, saying it has taken this decision following many months of negotiations in good faith. However, Etihad (EHD) said the parties had been unable to reach agreement on the final nature of such a joint venture (JV).
A source close to Austria-based FlyNiki (NKI) said the news from Abu Dhabi came as shock. Both brands: TUIfly (HAP)/(HLX) and FlyNiki (NKI) already operate in parallel with around 60 aircraft in the current summer period. “It is a clever strategy to create a strong European leisure-airline because there is too much capacity in Germany. But FlyNiki (NKI) is not available anymore,” (TUI) (TUG) board member Sebastian Ebel said June 7. “We will continue to push ahead with the repositioning of TUIfly (HAP)/(HLX) in order to develop a long-term perspective for the airline and its employees.”
According to Etihad (EHD), the leisure operations of the airberlin (BER) group will now continue to operate as a separate business unit under the FlyNiki (NKI) brand. Further details of this structure will be announced by airberlin (BER). (NKI)’s operating schedule remains unchanged with all bookings being honored; however, customers should contact (NKI) directly for any further information.
On December 5, 2016, Oneworld (ONW) Alliance member airberlin (BER) announced the sale of 49.8% of its Austrian subsidiary FlyNiki (NKI) to Abu Dhabi-based Etihad (EHD) for €300 million/$320 million), an investment that is important for financially troubled airberlin (BER).
At this point in time, it remains unclear what will happen with the €300 million (EHD) has already given to airberlin (BER).
The original plan had called for (TUI) AG (TUG) to hold 24.8% of shares in the (JV), with (EHD) holding a 25% stake. The remaining 50.2% shares will continue to be held by FlyNiki (NKI).
News Item A-3: British Airways (BA) is preparing for the longest strike yet in its dispute with some of its cabin crew (CA) as members of (BAB)’s London-based “mixed fleet” group of flight attendants (CA) are planning to stop work from July 1 to 16.
The initial reason for the long-running dispute, salary levels, has actually largely been settled, according to the Unite union, which represents the striking staff. “The issue is now largely around sanctions that have been meted out to the people who went on strike,” Unite spokesperson Alex Flynn said.
These sanctions included withdrawal of travel concessions and other benefits, he said. “We had put forward a compromise, but that was refused,” he added. As a result, Unite now plans to take 1,400 cases of affected personnel to the UK’s employment tribunal system, which arbitrates between employers and staff in such disputes.
(BAB) said June 27 that, as in previous disputes involving the cabin crew (CA), it would ensure that all passengers got to their destinations, either on (BAB) flights or on those of one of their partner airlines. Customers on “a very small number” of London Heathrow flights could find their long-haul flights being merged, said an airline spokesperson.
As during previous strikes, (BAB) will be wet leasing capacity to help it cope with the disruption. Whereas in previous strikes this capacity has come from UK or European carriers, (BAB) is this time considering leasing Airbus A320s and A321s from Qatar Airways (QTA).
This has triggered another protest from Unite. Pointing to what it described as (QTA)’s “inferior flight duty time limitations and rest requirements,” the union said that it had “warned that unless these had been ‘transitioned’ to meet (EU) requirements,” the wet lease would not be compliant.
Additionally, it said, it had warned “that if a bilateral international agreement between the (EU) and Qatar covering wet leasing does not exist, then approval for the lease would not comply and should be automatically refused.” The union said it had written to UK regulator the Civil Aviation Authority (CAA) on the matter.
A (BAB) spokesperson said: “As you might expect, we’ve not specified these planes. We’re looking at all options available to ensure our customers travel as planned.”
Qatar Airways (QTA), like (BAB), is a Oneworld (ONW) alliance member and (QTA) is the largest single shareholder in (BAB)’s parent company, the International Airlines Group (IAG), with a 20.01% stake.
(QTA) also has aircraft sitting idle at present, due to its major diplomatic spat with Saudi Arabia, the United Arab Emirates (UAE), Bahrain, and Egypt.
On June 27, the (CAA) said: “We are currently processing an application from British Airways (BAB) to wet lease 9 Qatar-registered aircraft. Under European regulations specific approval is required for an (EU) airline, such as British Airways (BAB), to wet lease aircraft from an airline based outside of Europe. The UK Department for Transport will approve or reject the application taking into account advice from the (CAA). We can confirm we have so far received a number of comments on the application, which will be taken into consideration.”
July 2017: News Item A-1: "Etihad Said American Code Share Decision is ‘Anti-competitive" by Karen Walker firstname.lastname@example.org, July 14, 2017.
Etihad Airways (EHD) said it is “disappointed” by American Airlines (AAL)’s decision to terminate its code share relationship and views it as “anti-competitive and anti-consumer.”
(AAL) announced July 12 that it notified (EHD) and fellow Oneworld (ONE) alliance member Qatar Airways (QTA) at the end of June that the code share arrangements with each carrier would end in March 2018. (AAL) said its decision was made as a protest against what it alleges to be government subsidies of the major Gulf carriers.
Responding to the announcement, an (EHD) spokesperson said its code share, begun in 2009, has been “mutually beneficial” and provided passengers flying to and from the USA with more and better flight options to points in the Middle East, Indian subcontinent and other destinations that historically have not been served by USA airlines.
“We view the decision by (AAL) as being anti-competitive and anti-consumer. This action will reduce choices for consumers and may result in higher fares for travelers to and from the USA.”
“We are committed to the US market and American consumers, and are taking all possible measures to ensure that the flying public is not harmed by this decision. We will continue our interline relationship with (AAL) to help ensure continued connectivity to secondary markets. We are committed to working with all airlines, including all USA carriers, to offer passengers more competition, more destinations, and an overall better flying experience.
(EHD) added that its 6 daily flights to the USA “in no way threaten (AAL), which together with its regional partner American Eagle, operates 6,700 flights daily to 350 destinations in 50 countries.”
November 2017: News Item A-1: Qatar Airways (QTA) has announced it is taking an almost 10% stake in Hong Kong-based Cathay Pacific Airways (CAT).
The agreement, which (QTA) said it expects to complete November 6, means (QTA) will hold a 9.6% stake in (CAT) at a value of about $600 million.
(CAT) and (QTA) are both members of the Oneworld (ONW) global alliance.
(QTA) already has a 20% stake in the International Airlines Group (IAG), parent of British Airways (BAB), another Oneworld (ONW) alliance member, as well as a 10% stake in Santiago-based (LATAM) Airlines Group (LAN), and a 49% investment in Italy's Meridiana (ALS).
(QTA) backed off from a move in June to take a 10% stake in American Airlines (AAL), also in (ONW), after (AAL) Chairman & (CEO) Doug Parker sharply rebuked the bid as “puzzling at best; concerning at worst.” (AAL) is campaigning with Delta Air Lines (DAL) and United Airlines (UAL to constrain growth of the major Gulf carriers: Qatar, Emirates Airlines (EAD) and Etihad Airways (EHD) over claims that they are heavily subsidized by their government owners.
Qatar Airways Group (CEO) Akbar Al Baker said on November 6 that Cathay (CAT) was “one of the strongest airlines in the world, respected throughout the industry and with massive potential for the future.”
(CAT) (CEO) Rupert Hogg said that the 2 airlines already work closely together as (ONW) members "and we look forward to a continued constructive relationship."
In August, (CAT) posted a net loss of -HKD2.1 billion/-$268.2 million for the 1st half of 2017, a reversal from a HKD353 million net profit in the same period last year. (CAT) faces increasing competition in many of its markets, particularly from mainland China’s major airlines. (CAT)’s major shareholders are Swire Pacific, which holds 35%, and Air China (BEJ), which holds almost 30%.
Click below for photos:
ONW 757-2009-11 AAL
ONW-767-323ER AAL 2009-11
ONW-A320-232 2009-11 CMA
ONW-A330-AIR BERLIN ONEWORLD-2012-03
ONEWORLD (ONW) MEMBERS: (JOINED)
AIR BERLIN (BER) (2012)
AMERICAN AIRLINES (AAL) (1999)
BRITISH AIRWAYS (BAB) (1999)
CATHAY AIR PACIFIC (CAT) (1999)
FINNAIR (FIN) (1999)
IBERIA AIRLINES (IBE) (1999)
JAPAN AIRLINES (JAL)/(JAS) (2007)
(LAN) AIRLINES (2007)
(LAN) COLOMBIA (AIR) (2013)
MALAYSIA AIRLINES (MAS) (2013)
MEXICANA (CMA) (2009)
OPEN SKIES (OPK) (2012)
QANTAS AIRWAYS (QAN) (1999)
QATAR AIRWAYS (QTA) (2013)
ROYAL JORDANIAN AIRLINES (RJA) (2007)
S7 AIRLINES (SBR) (2010)
SRILANKAN AIRLINES (LNK) (MAY 2014)
(TAM) AIRLINES (TPR) (2014)
US AIRWAYS (AMW)/(USA) (2014)
COMAIR (CML) (1999)
DRAGONAIR (DRG) (2007)
FLYNIKI (NKI) (MARCH 2012)
GLOBUS (GLP) (2010)
JAL EXPRESS (JEX) (2007)
JALWAYS (JAI) (2007)
JAPAN TRANSOCEAN AIR (SWL) (2007)
JETCONNECT (QNZ) (1999)
LAN ARGENTINA (LNR) (2000)
LAN ECUADOR (LNE) (2000)
LAN EXPRESS (LDE) (2000)
LAN PERU (LPU) (2000)
QANTASLINK (NJS) (1999)
Click below for photos:
ONW-2-Rob Gurney - 2016-08.jpg
PEKKA VAURAMO, CHAIRMAN ONEWORLD (ONW) ALLIANCE (2017-06).
Pekka Vauramo chairs the governing board of the Oneworld (ONW) alliance for the coming 2 years. Vauramo took up the role at (ONW)’s mid-year board meeting, held on the sidelines of the (IATA) (AGM) in Cancun, Mexico.
He took over the Chairmanship of former Cathay Pacific (CAT) (CEO) Ivan Chu, who has since moved to another role and been succeeded by Rupert Hogg. Pekka now chairs Oneworld (ONW) board meetings, oversees alliance governance and works closely with (ONW) (CEO) Rob Gurney and the central alliance team.
Pekka has been (FIN) (CEO) since 2013, leading (FIN)’s turnaround and growth strategy. He previously served with Finnish cargo and load handling company Cargotec and with Sandvik, the Swedish mining and construction company, in various senior management positions.
ROB GURNEY, CHIEF EXECUTIVE OFFICER (CEO) (2016-08).
Rob who was an Emirates Airline (EAD) Executive, replaced Bruce Ashby as the (CEO) of the global Oneworld (ONW) Alliance.
BRUCE ASHBY, CHIEF EXECUTIVE OFFICER (CEO), EX-SAMA (2010-12), COMPLETED TERM (2016-08).
December 2010: Ashby led a “central team” of 25 staff that was relocated to New York mid-2011. The 46,200 sq ft/4,300 sq meter office at 2 Park Ave, also became the New York office for American Airlines (AAL) and British Airways (BAB), and housed the team managing the new transatlantic joint venture (JV) of American (AAL), (BAB), and Iberia (IBE). Several other Oneworld (ONW) alliance carriers also relocated their New York operations to the Manhattan office.
“The Oneworld (ONW) alliance (has set the benchmark in the increasingly important arena of airline alliances, with its grouping of best-in-class carriers from each region and its focus on quality and innovation. Bruce stated it was a privilege to be invited to succeed John McCulloch to lead the Oneworld (ONW) alliance forward.
Bruce Ashby entered the airline industry in 1987 as a consultant, and was named Manager Operations Research in 1989 by United Airlines (UAL). He remained there for six years, holding several VP titles, before joining Delta Air Lines (DAL) in 1995 as VP Marketing Development. Ashby then moved to US Airways (USA) in 1996 as VP Financial Planning & Analysis, and rose through management to become Executive VP Marketing. In 2005, he left to head Indian carrier IndiGo (IGO), where he stayed until 2008 when senior management ranks were culled, and then joined Saudi Arabian low-cost carrier Sama Airlines (SMA) as CEO. Sama (SMA) ceased operations in August 2010.
JOHN MCCULLOCH, MANAGING PARTNER, EX-(CAT) (2003-06), RESIGNED (2010-12).
John was based in Vancouver, where the alliance’s global headquarters was established in June 2000. He was promoted to Managing Partner in June 2003, after serving for three years as deputy head of the alliance's central team, the Oneworld (ONW) Management Company, as VP Marketing. He began his airline career with Cathay Pacific Airways (CAT), covering roles in marketing, sales, country management, distribution, yield management, operations and technology, living and working in most countries in Asia during his 15 years with the company.
Before joining (ONW), he worked for (HSBC), one of the world's largest financial institutions. As its Head of Group Marketing, based in its London headquarters, he was responsible, among other areas, for implementing its re-branding in 1999/2000, which saw the group’s various regional banks (Hong Kong Bank of Canada for example) change to the ubiquitous “HSBC” global brand.
John spoke intermediate Japanese and basic Bahasa Indonesia and was an active sportsman and lover of the outdoors. He is married to Yuko, a Japanese national, and has three children.
MOSHE LEVERTOV, VP INFORMATION TECHNOLOGY (IT) & COST REDUCTION, EX-(ELA) (2008-07).
ROBERT ANTONIUK, VP CUSTOMER EXPERIENCE & AIRPORTS, EX-(CAT) (2009-03).
Robert returns to the (ONW) Management Company after four years with alliance founder member Cathay Pacific (CAT), where he served as Airport Services Manager Vancouver. Reporting to (ONW) Managing Partner, John McCulloch and based at the alliance's Vancouver head office, he will work with the group's member airlines to lead the development and delivery of (ONW)'s customer experience products and proposition as well as overseeing the centralized co-ordination of alliance airport co-location projects. He originally joined (ONW) in 2001, working initially as Manager, Brand Performance & Development and then as Director Customer Experience & Airports.
MICHAEL BLUNT, VP CORPORATE COMMUNICATIONS.