oneworld members expand co-operation to generate more benefits for customers and shareholders23 November 2002
Members of the oneworld™ global airline alliance – American Airlines, British Airways, Qantas, Iberia, Cathay Pacific Airways, LanChile, Finnair and Aer Lingus – are taking further key steps to deepen working relationships between them as they seek to build on the US$2 billion of value generated since the grouping was formed three years ago.
Meeting in Madrid today for the first time since Iberia joined the alliance, the Chief Executives from the eight airlines approved its business plan and budget for the year ahead. Key priorities are t
- Continue to build revenues generated joint alliance activity, with more alliance fares to be rolled out. oneworld already offers more alliance fares than all the competition combined.
- Increase levels of cost savings for member airlines, through more joint purchasing and sharing of facilities.
- Deepen working relationships between the grouping's existing partners.
- Further improve alliance customer services, with e-ticket interlining expanded across more of the alliance's airlines and other initiatives to make it even easier for passengers to transfer between its members' networks.
Since oneworld took off in February 1999, joint activities across all areas have generated additional value for its member airlines totaling more than US$2 billion – through revenue generation and feed, and through efficiencies from joint purchasing, shared airport and city facilities and other savings.
oneworld serves more countries than any of its competitors and was voted the world's best airline alliance in the first awards recognizing this sector of the industry. Its members serve more countries than any other alliance – 135 territories and more than 550 destinations - with some 8,700 departures a day.
Its partners believe they can best generate more benefits for their customers and shareholders by expanding the levels of co-operation between the existing membership rather than by putting higher priority on recruitment.
Speaking as the Chief Executives from all eight member airlines gathered in Madrid for their final Governing Board meeting of the year, oneworld's Managing Partner Peter Buecking, said: "Among the key strengths of oneworld are the quality and controlled size of our membership.
"The substantial progress oneworld has made in contributing to our members' bottom lines – through increasing revenues and reducing costs by working together – and innovating in customer service is largely the result of being a manageable-sized grouping of well established, quality partners.
"We have always firmly believed an alliance's success can best be measured by the value it adds to its customers and airlines - not by the number of recruits it signs up. While we continue to speak to other like-minded airlines who are keen to join us, our main focus remains on expanding the links between our existing members to increase their efficiency - even more important in the current financial climate - while improving our combined customer offering still further."
Among the latest steps taken to deepen working relationships between oneworld members:
- Aer Lingus and Iberia have extended their code-sharing agreement, with the IB code now also placed on the Irish carrier's flights between London and Dublin, and on its flights serving Cork and Shannon to and from both Dublin and London. The two airlines already shared codes on one another's services between Dublin and both Barcelona and Madrid.
- American Airlines and British Airways this week applied for US regulatory approval to offer code-share services permitted under the current US-UK air services agreement. This would enable them to place the AA prefix on British Airways' services beyond the US airlines' UK gateways to key destinations in the UK and Ireland, continental Europe, Africa, the Middle East, and Asia, and on BA's Manchester-New York JFK transatlantic, and add the BA code to American's flights beyond the UK carrier's US gateways to points in the US, Mexico, the Caribbean and Latin America, and on AA's transatlantic flights between Chicago and both Glasgow and Manchester.
- American Airlines and Cathay Pacific expect to start code-sharing early next year following last month's agreement between the US and Hong Kong authorities to expand on air services between the two territories. Subject to approval from the US and Hong Kong governments they initially plan to add the AA code to services by Cathay Pacific between its Hong Kong hub and Los Angeles, New York JFK and San Francisco, and beyond Hong Kong to and from Bangkok, Kuala Lumpur, Penang and Singapore. Cathay Pacific's CX code will be placed on American flights from US gateway cities to 20 cities across the States: Atlanta, Austin, Boston, Chicago, Dallas/Fort Worth, Denver, Detroit, Fort Lauderdale, Hartford, Houston, Las Vegas, Miami, Orlando, Philadelphia, Pittsburgh, San Diego, San Jose, San Juan, St Louis, Washington/Baltimore.
- American Airlines and Finnair will be expanding their co-operation in a variety of areas following their receipt of anti-trust immunity from the US Department of Transportation this summer.
- American Airlines and Qantas have moved closer together at major oneworld hub Los Angeles International Airport with the Australian airline now using AA's new immigration facilities at the airport's Terminal 4, speeding passengers' journeys on the ground on arrival and easing transfers for those taking its code-share flights with American to other US destinations. The QF flight prefix has also been added to a 16th destination in North American through its code-sharing with AA – Denver.
- British Airways and Iberia have expanded their code-sharing arrangements to cover their services between their London Heathrow and Madrid and Barcelona bases as they deepen their bilateral working relationship to cover areas such as joint network planning, co-ordinating capacity and pricing and sharing more airport facilities to improve transfer services at their main hubs.
- LanChile and Qantas have linked their Santiago and Sydney home bases by direct flights for the first time. The South American carrier is now flying the route three times a week, via Auckland, with its services also carrying the QF code, shaving hours off the previous fastest journey time between the two cities. The QF code is also placed on LanChile connections at Santiago to and from a range of Latin American destinations.
On the ground, oneworld carriers will be sharing check-in, ticketing and lounge facilities at more airports around the world, following steps taken recently at Amsterdam, Bogota, Brussels, Buenos Aires, London Heathrow, Madrid, Miami, Singapore, Stockholm and a variety of other destinations, providing better facilities than they could justify on their own and increasing alliance efficiency.