Yesterday was apparently THE day to make news if you’re running an airline and looking to change the face of the global alliances. The oft-suspected (and occasionally flatly denied by the CEO) joining of Qatar Airways into the oneworld alliance was the major news that everyone expected. The ascension of Qatar into the alliance is expected to take 12-18 months and British Airways – recently a loser in the Qantas/Emirates deal – will be the sponsoring carrier for Qatar.
Not quite as expected was the announcement from Etihad and AirFrance/KLM that they were going to be building out a major code-sharing arrangement. Not only that, but Air Berlin – ~30% owned by Etihad – is also getting in on the deal. Air Berlin is also a oneworld member and Air France/KLM represents a huge chunk of the SkyTeam group. Or, to quote Doctor Peter Venkman, "dogs and cats living together… mass hysteria!" Okay, maybe not mass hysteria, but the move does represent the largest codeshare agreement between two alliance members from different alliances that I’m aware of.
And, let us not forget that Emirates may have started this whole thing rolling when they made the deal with Qantas, getting the latter to dump British Airways as their partner on the Kangaroo routes. It shouldn’t come as much of a surprise that analysts are saying that deal was the catalyst for the final push from BA to get Qatar to join up.
So, does Air Berlin now have to leave oneworld? Does Qantas? And does it make sense for either of them to? No, no and no.
For the past 15 years the alliances have been presenting themselves as the only logical way to build a network offering global coverage without actually flying to all the destinations. And there is certainly value in these alliances. But they aren’t the only option.
Several carriers have done reasonably well playing as "partner to everyone" rather than choosing just one pool of partners. The logistics might be a bit more difficult – more different systems rather than a single interface into the alliance definitely is – but that doesn’t mean it cannot be done. And the alliance members still have their bilateral relationships where necessary.
The real value for the airlines likely lies in the anti-trust immune operations. These tend to follow alliance lines but they aren’t exclusively so. And just being part of an alliance doesn’t guarantee participation. In other words, the real money comes not from the alliance but from having the right partners and government approvals.
The alliances are nice marketing arrangements for the airlines. And when they are operating smoothly there are even occasional benefits to the passengers. But the "shake-up" from the big three in the Middle East isn’t going to upset those alliances. At least not yet. Maybe they’ve got a few tricks still up their sleeves.