Alliances Partnership Between Airline Firms

Yilin Huo

M498

Dr. Liang

Oct 31, 2016

Ass 13

Alliances partnership between airline firms have become a dominant feature of the airline industry.  Since there are many customers demand a various service, which is impossible for one airline to supply efficiently, and there are significant economies of density that can be achieved by merging networks.

The need for network cooperation has led to a rapid expansion of alliance relationships, as a close substitute for mergers. Thus, airlines have set up joint ventures to serve specific markets which have made airline partners’ revenue from the JV independent of the airline which actually flies the passenger. This strategy is significant in that it maximizes the opportunity for pro-competitive efficiency gains from density economies. Other wises, here is now substantial evidence that existing alliance relationships have led to significant consumer benefit for passengers on interlining trips, both in terms of improved service and lower fares.

Aeroméxico, Air France, Delta Air Lines and Korean Air founded SkyTeam in June 2000. Since then, they have steadily grown to their current membership of 20 airlines. Over the last decade – a challenging one for the aviation industry – they have more than tripled the number of member airlines, doubled the number of flights and nearly doubled our destinations, while offering customers smoother connections around the world.

By the way, their steady growth of members, their focus on covering the globe is clear. they have added airlines from virtually every corner of the planet, in addition to flying from some of the most modern and convenient hubs in Europe, the United States, Asia and Africa. As they grow, they continue to offer their customers frequent flyer programs, more destinations, more frequencies and better connectivity.