Airline alliances: how do they shape your travel?

By David Flynn, June 23 2014
Airline alliances: how do they shape your travel?

It’s good to have friends, especially in a cut-throat industry where competitors are often fighting for larger slices of an ever-shrinking pie.

That’s the rationale behind airline alliances – families of airlines bound by ink and contracts, and sometimes by common enemies as much as common interests.

Most Australian travellers would be familiar with Oneworld, one of the three global airline alliances.

It counts Qantas, British Airways and Cathay Pacific as cornerstone members, along with American Airlines, Japan Airlines, Finnair, Malaysia Airlines and most recently Qatar Airways and SriLankan.

Competitor Star Alliance has its own A-list roster including Singapore Airlines, Air New Zealand, Lufthansa, Thai Airways and United.

(Ansett was part of the Star family until the Aussie airline collapsed in late 2001, taking with it untold millions of frequent flyer points ansd leaving Star with a still-smarting gap in the Australian market.)

Rounding out the troika is SkyTeam with Korean Air, China Southern, Garuda Indonesia, Air France and US carrier Delta in its corner.

Alliances are quick to spruik their benefits. There’s seamless travel on a single ticket, even when you’re hopping between several airlines, while your luggage (at least in theory) follows faithfully along from plane to plane.

You can earn frequent flyer points with your chosen partner airline even when travelling on another alliance member’s metal, and you can use them to snare free seats and upgrades on those other airlines.

Then come on-the-ground goodies such as access to almost any lounge run by any partner airline, and status-based privileges like a higher checked luggage allowance.

While that all sounds pretty appealing, many airlines are picking their own dance-partners rather than joining one of the three alliances and inheriting its membership like a clutch of foster-children.

Virgin Australia has adopted a DIY approach, forging close partnerships with Air New Zealand, Singapore Airlines, Etihad, Delta, Virgin America and Airberlin, among others.

Virgin Australian chief John Borghetti says it’s all about choosing airlines based on ‘best fit’ principles to strategically build out Virgin’s international network.

Read: Virgin Australia CEO nixes Star Alliance, SkyTeam

Across Virgin's virtual network you can generally make multi-airline bookings, earn and burn frequent flyer points, enjoy reciprocal lounge access… in other words, the same core benefits of a formal alliance.

The Qantas-Emirates hookup is another example of a bilateral buddy-system built around the needs of each airline, and sees Alan Joyce cannily put a dollar each way.

Qantas retains oneworld membership while stitching up a bespoke partnership with Emirates, which stands steadfastly independent, with Emirates president Tim Clarke shunning alliances as “gang warfare” on a global scale.

“I’m so opposed to alliances because I believe they distort and channel and direct for the greater good of the alliance thing, rather than the consumers that are driving it all,” Clarke once explained in an interview with aviation industry website FlightGlobal.

“There is actually room for us and our way of doing things, and the way they do. I’d rather work with all these airlines on an independent basis, and that’s what we do.”

Understandably, Oneworld CEO Bruce Ashby has a different opinion.

“We don’t bind anybody’s hands” says Ashby. “That wouldn’t be good not good for us, our members or the travellers.

“Look at Qantas-Emirates. There’s a business niche and a need that Qantas wants to fill."

"Emirates is an excellent partner and Oneworld didn’t  have somebody who could step into that gap. That doesn’t hurt us, and it helps Qantas which is is one of our members, and that’s what we’re about.”

How significantly do airline alliances shape your travel plans, and which do you rate as the best alliance of The Big Three – or are alliances on the whole becoming less relevant to you?

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David

David Flynn is the Editor-in-Chief of Executive Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

Qantas - Qantas Frequent Flyer

18 May 2011

Total posts 228

It plays a huge role.
All my trips are with OneWorld.
So far I have been fortunate - they have been able to take me everywhere I've needed or wanted to go. 

Qantas - Qantas Frequent Flyer

30 May 2013

Total posts 321

OneWorld is pretty important to me. I'm travelling to the USA with Qantas soon and will be doing all of my intra-USA travel with American Airlines - all with QF codeshare flight numbers. Great for frequent flyer points and status credits.

25 Feb 2013

Total posts 60

As much as I detest Qantas (and given my previous experiences, their hub shift to Dubai over Singapore, their reduction in destinations and devaluation of their program I can't see ever liking them again) the lack of alliance with Virgin (whose service I love) has me questioning whether to go back to QF for domestic flights - purely because of OneWorld, not because of QF (in fact I will not be usinf QFF but be using BA Avios).

Borghetti's custom alliance is a delusion and doesn't even come close to offering the core benefits of entering a real alliance. I can't get reward flights on any of their 'special' partners if they codeshare with alliance members and even as a platinum member I can't get lounge access in most of the port VA or its partners fly to (as there is an incrsaing use of alliance lounges over individual airline lounges). Priority seating and other inflight bennies etc is also rather poor in the VA ad-hoc arrangement compared to an alliance member. 

I agree with fxdxdy that it plays a huge role. Borghetti needs to be careful too - not being in an alliance is as much a push factor away from an airline as much as a good alliance pulls towards one. I know I am not alone among VA elites who are waiting to see if the VA alliance situation improves (or at least that VA is treated the same by partners as the alliance members are) before making a decision whether VA remains worth it (and this is in spite of most of us preferring the VA experience over QF). I also know of many who went back to QF because of OneWorld, and would jump back to VA in a heartbeat if they joined *A or SkyTeam.

19 Jul 2012

Total posts 15

Agreed. 100%. Word for word it describes my exact same situation. I am devoted to STAR, I detest all that AJ is doing to QF, but I also keep oneworld gold because the benefits it offers far outweighs anything that VA platinum gives me globally. All of that travel would go to Virgin if only they were a member of STAR but until then, I share it around. 

Qantas - Qantas Frequent Flyer

13 Sep 2011

Total posts 182

Oneworld is so important to me that, now I'm ditching QFF after those now infamous "enhancements", I have joined the British Airways scheme to stay with a OW airline.  I am lucky to have a UK address as BA do not allow members from Australia/NZ, since 2001, and the reason I didn't join CX at this stage was due to their newly anounced auction for upgrades which I think de-values points applications.

"I’m so opposed to alliances because I believe they distort and channel and direct for the greater good of the alliance thing, rather than the consumers that are driving it all..."

Screw the team. It's  just me, me, me! Sounds like those spoilt Gen Y types! LOL

Qantas - Qantas Frequent Flyer

13 Sep 2011

Total posts 182

TRB, I read that statement a different way.  I think he is saying that alliances work primarily for the alliance and the fare paying customers are a coming a poor second in their priorities.  In effect he's right, check the prices between OW airlines between SYD and LHR, they are all within a whisker of each other price wise.  There is certainly less choice as well, BA used to fly to SYD via SIN, BKK and HKG as did QF.  Not now, they use alliance partners and do seem to dress it as seemless service etc.  The companies have to make a profit, noboby disputes that, but the alliances could be seen as a cartel which could be his point. Though Emirates prices are dead set with QF now, an alliance of sorts.

woganfan, I agree with you to an extent! But I cannot help but think Emirates just wants an alliance on its own terms. Sometimes in this world you've just got to work with people and grow together. I appreciate the cartel element you suggested. But how do we balance value for money with sustainable operations?

Qantas - Qantas Frequent Flyer

13 Sep 2011

Total posts 182

I do agree somewhat with what you say TRB, there is a feeling on this forum that Emirates are dictating to Qantas now, especially given the enhancements to the QFF scheme. I think it is very sad that QF are seemingly turning their backs on OW partners.  The tie up with BA whilst not perfect, seemed to favour the customer, especially with the whole of OW considered.

How to balance value for money with sustainable operations.  I am not sure, domestically and internationally, I can't say I've noticed excess capacity in the market that the airlines talk about, all flights I have been on seemingly packed to the rafters and in my view, prices escalating.  Interesting debate for sure though.

I agree. The Qantas-BA partnership is natural.  Qantas will find it's way again once the gloss of Emirates fades, and BA will be there with open arms, like an old, unexciting but familiar lover.

The tripple alliance of BA, AA and QF to me is not only natural but extremely complementary. But each needs to change sightly to bring out the best in the alliance. For that you need vision and inspirational leaders. 

Qantas - Qantas Frequent Flyer

13 Sep 2011

Total posts 182

Perhaps you and I should apply for leadership roles in QF/BA/CX/AA, lol.  Been armchair experts we could do a crackerjack job lol.

_bj
_bj

20 Jun 2014

Total posts 8

Most of my travel is VA, so I keep my points flowing that way, but anything outside of the country gets sunk into (first pref) Air NZ and then (2nd pref) QFF to keep status while travelling OS. Access to lounges and rewards is so much easier with an alliance, rather than the extra T&C's with VA's "virtual" alliance (ie. have to be travelling on a VA-coded flight within the next 4 hours, etc.).

If VA hooked up with an alliance, then I'd steer my OS spend back onto that to keep it in the alliance family. I've always found it strange that the Virgin stables (America, Australia, Atlantic) never did formalise a Frequent Flyer Alliance.

Side Note - Whatever happened to Virgin Atlantic joining SkyTeam or *A? (see 2012 article, https://www.executivetraveller.com/virgin-atlantic-to-join-star-alliance-or-skyteam-richard-branson-keeps-em-guessing)

Qantas - Qantas Frequent Flyer

25 May 2012

Total posts 582

Virgin Atlantic's alliance plans have either been shelved or delayed due to Delta's substantial investment. Whether it joins Skyteam or simply maintains its partnership with Delta is unclear.

Plans change in the aviation industry more easily than the weather...

_bj
_bj

20 Jun 2014

Total posts 8

That's a shame - I thought a SkyTeam match would have been a good fit, but you're right - things happen thick-and-fast.

I shan't hold my breath :)

Qantas - Qantas Frequent Flyer

01 Oct 2013

Total posts 93

It's the little things about alliances that make it worthwhile to me - uniform lounge access conditions, points & status earning beyond codesharing, increased baggage allowance, etc. I like to know that my loyalty ensures that I'm taken care of when it's not possible to fly my preferred airline.

I can't speak for *A, but I've noticed that OW members are taken care of pretty well across the network. I've always received that extra effort & attention as a QF elite on AA and CX, and conversely QF hosties always give extra attention to my AA & BA elite seatmates. It's nice to be treated as one of their own across the network.

I think the vehement distain of traditional alliances is really holding me back from considering VA & others, even if they have a better product - because if they can't recognise the uniformity benefits of traditional alliances, I'm not sure if they truly understand the wants & needs of an international business traveller, where my destinations extend beyond a handful of their routes.

Qantas - Qantas Frequent Flyer

13 Sep 2011

Total posts 182

You're right about OW treating all passengers with an equal standard across lounges and aircraft though QFF seem to be treating frequent flyers with a great deal of disdain with their enhancements unless you use their travel agent website to fly on an Emirates aircraft which seems to be kicking OW to the kerb, as TRB said earlier. Emirates wanting an alliance on their own terms.


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