Code Sharing vs Star Alliance

[JerryMaguire]

Hi guys,

Was just wondering the difference between Star Alliance and Code sharing.

I know that the Star Alliance is the largest airline network in the world but....

1st cut, I guess aside from earning extra frequent flier miles and getting into airport lounges, star alliance members get priority booking and baggage handling for the gold members too. That's so much for the flying consumer.

However, I just thought that to the airliner industry strongmen themselves, connecting flights are the most important ain't it? Code sharing achieves that I would assume.

Reason why I ask is that I'm sure being a member has its privileges but of coz it cost to be a member too so was wondering what are the drawbacks of being in the network, ie any rulings or restrictive regulations to stick to which might not be so optimum for the airlines?

Oh I forgot to include the existence of Oneworld alliance, probably the 2nd biggest airline network including some of the top airlines like Giant British Airways which will "manipulate" London Heathrow T5 soon and Airtran champion Cathay Pacific.

No doubt being in an alliance instead of in code share will increase the enmity between airlines rite?

Further there must be some strange strategic reasons why various airlines choose from the available alliances.

Comments pls?

[LGS6753]

Jerry,

The alliances are designed to do more than code-share. They are buying aircraft together (and hitting Boeing and Airbus as well as Canadair and Embraer, as hard as they can), buying fuel together, sharing airport facilities, maintenance facilities, etc. It's far more than code-sharing, and the competition authorities ought to be watching them very closely...........

[JerryMaguire]

Yeah I know they'r designed to do more some of which u mentioned and more can be found on the websites of the respective alliance websites.

I din know that the alliances buy aircrafts together, are u sure abt that? I mean, the airlines decide which planes they are more comfortable with actually dun u think? How can, for instance, Singapore Airlines impose upon the rest to purchase airbus A380 just because it is? which leaves me to question what the partners are in for when they join the alliances. ie are there any limiting choice making boundaries?

[Globaliser]

If two airlines codeshare on a flight, you can think of it a bit like the two airlines each flying half an aircraft on the route. They will market it and sell it separately. In the purest bare codeshare:-
(a) the two airlines will still be required to compete against each other even though they are selling seats on the same aircraft - which is why you might find that airline X has seats at (say) £300 on the flight, while airline Y is selling them for only £250;
(b) there will be no other cooperation between them - not even a frequent flyer partnership, so that you can't earn airline X FF miles if you buy tickets with the airline Y code on them, even if airline X is operating the aircraft.

The ultimate alliance is one in which the two airlines cooperate on things like marketing, pricing and selling. There'll be full reciprocity on frequent flyer benefits, and every flight will carry the codes of both airlines even though each airline operates only half the physical flights. The best example of this is not the Star Alliance, but KLM and Northwest.

Most alliances are somewhere in between these two extremes. For the regular customer, the biggest headline benefit is usually that you earn status across the entire alliance as if it were a single airline, and you are given recognition accordingly across the whole alliance.

It's true that the alliances are looking at joint purchasing of aircraft, but I don't think that any big deals have yet come off in this area. No airline will be required to take any particular aircraft, but all those looking to buy, say, A380s will club together and place one order. A big order gets a better price. Plus, in the Star Alliance's hopes, they will order aircraft to identical specifications, so that the aircraft can be more easily swapped/leased/sold to each other in the future.

If you want to look at the model for this, though, some individual airline groups have done it. For example, I think that BA placed a big common order for A319s which were intended to be distributed amongst different parts of the group, including franchisees that are legally and operationally totally independent companies.

Buying fuel, airport services, etc. and sharing terminal facilities is becoming much more common. When LHR T5 opens and hoovers up BA and a few other bits of oneworld, Star wants to move into a single terminal although rumours seem to be equally divided between T1 and T5.

[spagiola]

Several Star Alliance carriers (AC, LH, SK, OS) have banded together to place a joint order for regional jets. Only the AC part of that order (15 CRJ200, 30 CRJ705s, + 45 options; 45 ERJ 190 + 45 options) has been announced so far, though, and the other carriers seem to be in no hurry to follow suit.