Global airline alliances have not delivered the benefits promised to passengers, but are making member carriers millions of pounds a year.
Oneworld, centred on British Airways and American Airlines, Star Alliance (Lufthansa and United Airlines) and SkyTeam (Air France and Delta) were all established in the late 1990s because laws prevented mergers. Customers were led to expect single frequent-flyer schemes and harmonised IT systems.
But Oneworld managing partner John McCulloch said none of the projects worked.
“You can’t drag six or eight airlines into a single frequent-flyer programme.” he said.
“There has been some move toward harmonisation on global fares, e-ticketing and interline ticketing.”
McCulloch said further harmonisation would only come through airline mergers.He said interline ticketing within BA’s Oneworld alliance was worth $1.8 billion in 2005 and is growing in value at 11% a year, compared with a 2%-3% rise in interline ticketing between alliances.
Additional benefits have come in joint purchasing of fuel, ground-handling, and sharing facilities and best practice. But he said members remain “fiercely competitive.”