Tag: Airline Alliances
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What's Up with the Oneworld Alliance in 2012
After a challenging year for some of the founding members of the Oneworld alliance, 2012 will surely be brighter. In 2011, the alliance saw American Airlines file for bankruptcy and Qantas' chief grounding the entire network to challenge labor disputes, plus Iberia closing out the year with rounds of employee strikes.
There were some shining stars, however, with the finalization of International Airline Group (the conglomerate that combines British Airways and Iberia), Cathay Pacific offering overhauled cabins and in-flight amenities, and Japan Airlines emerging from bankruptcy stronger and more stable.
As we get going with 2012, we can't help but notice the huge changes happening amongst these airline buddies. Oneworld is the world's smallest of the major airline alliances, yet consistently hits the high marks in passenger ratings. With the addition of 3 new carriers, Oneworld will gain a fighting chance to excel in years to come. Here's what's happening meanwhile:
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Air India's Epic Tarmac Delay Almost Triggers Full-Blown Riot

Air India can't seem to do anything right. The company tried for years to join Star Alliancewe covered some of their bumbling efforts last Mayonly to recently give up and suspend integration efforts. Star Alliance's minimum membership requirements, which other airlines seem to be able to meet just fine, turned out to be just too difficult for the Air India people to figure out. On its face, that's not a particularly encouraging signal of competence.
Now comes news out of London that the airline was responsible for a truly epic nine hour tarmac delay, which came at the endnot at the beginning, but at the endof a long-haul flight from Mumbai.
200 passengers plus one Boeing 777 minus any food unsurprisingly equaled grumpiness. If you're saying to yourself, "I can't believe cops weren't called to put down a riot," you'll be interested to know that cops were indeed called to put down what almost became a riot.
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Air India Racing Against Time to Join Star Alliance

Air India has been given a hard deadline of July 31st to finally meet the entry requirements for Star Alliance, something the Mumbai-based airline has been trying to do since they got an invitation to join Star in 2007. The airline needs to standardize its operations and computers with the rest of the alliance, so that happy alliancey things like code sharing, seat upgrading, and reward traveling can start happening.
Integration has proven to be something of a problem, and Air India has already requested and received three deadline extensions. We're guessing that a fourth extension won't be forthcoming, given Star Alliance CEO Jaan Albrecht's subtle hint that "we will not extend this deadline anymore."
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Shanghai Airlines Dropping Star Alliance, Moving To SkyTeam

This was kind of predictable. Having been taken over by SkyTeam carrier China Eastern Airlines, Shanghai Airlines will leave Star Alliance later this year and take up residence under that alliance's umbrella. So if you want to use your Star Alliance points to book a Shanghai Airlines flight, you've got until Halloween. Probably a little before that, if you want to be on the safe side.
Shanghai's departure won't really hurt Star Alliance as much as it will help SkyTeam. Star will still be be the largest of the three alliances, with 27 carriers that outright blanket the entire globe (minus, in fairness, Australia). It will still have the world's largest airline in United/Continental. In North America it will still have US Airways and in Europe it will still have Lufthansa. In Asia it will still have China Air, the continent's fifth largest airline and one that continues to grow aggressively. So Shanghai's defection isn't exactly going to be a devastating blow.
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More JAL Poker: American Sees Delta's $1B Bet And Raises A Million More

The game thus far: Japan Airlines let it be known that they would maybe consider leaving oneworld for SkyTeam - thereby devastating American's presence in Tokyo - if the price was right. Delta almost immediately offered $1 billion plus transition expenses if JAL would make the switch. Fast forward a few weeks later and American has made their counteroffer - $1.1 billion plus JAL wouldn't have to worry about transition expenses because there wouldn't be any transition.
It's not a "far superior" offer, which is the soundbite that American CFO Tom Horton is handing out. But we checked our calculators, did a little subtraction, and it does indeed seem to be straightforwardly more money. Plus JAL would be spared not only transition costs but all of the non-monetary problems that were on display during Continental's move to Star Alliance. Here are a few more details of American's counteroffer:
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Delta Offers JAL a $1 Billion Bribe to Unfriend American Airlines

We promised you last week that the playground hair pulling fight between Japan Airlines, American Airlines, Virgin Atlantic, and Deltawhere JAL may or may not decide to dump American Airlines/oneworld in favor of Delta/SkyTeamwas going to get more interesting. That's exactly what happened this morning, when Delta decided to put an eye-popping $1 billion on the table to entice Delta into switching.
Yowsers! Let's look at what went down...

