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The Benefits Of Airline Alliances: How Business Travelers Can Get The Most Out Of The System

March 6th, 2017 /

Even as a frequent flier, I learn new industry terms every day. I normally don’t pay attention to the fact that my cross-country flight may have multiple flight numbers, but after “code sharing” cropped up in business class, I gave my ticket a second look.

The three major airline alliances exist to make global travel easier on the international flyer, but it seems they influence the minutiae of domestic travel as well—including my monthly flights. For business travelers, the benefits of the alliance system and the situation for airlines who refuse to join can significantly affect their everyday travel experience.

Airline alliances have changed the way we travel.

Image by Flickr user Andres Nieto Porras.

Decoding Today’s Airline Alliances

It’s no surprise that the drive for worldwide expansion created big changes in the airline industry. The first alliance was formed in 1997 between five airlines on three continents, and their initial goal was to allow easier connections for passengers flying internationally. Since then, alliances have changed, airlines have merged, and the industry has evolved.

United, Lufthansa, Air Canada, and twenty-four other airline partners make up today’s Star Alliance, the largest of the three and the first alliance of its kind. They are known as the North American Alliance and currently offer the widest variety of destinations. Star Alliance also won the Skytrax best alliance award for 2016—which makes it not only the largest but reportedly the best alliance on the market. However, that certainly doesn’t mean that Star Alliance necessarily has all the best airlines.

For instance, take Sky Team—the group formed by Delta, Air France, and Korean Air in 2000. You probably recognize their logo from luxury airport lounges across the US. Depending on how and where you fly, Delta may be your best choice. This airline is a favorite for living up to customer expectations and requests, and their alliance carries the most passengers per year (670 million).

Finally, we come to One World. Though there are other small alliances on the fringe, this is the last major player in this market. The partnership of AA, British Airways, and regional airlines has created a network evenly spread across the globe. This alliance is a good choice for someone seeking a “round the world” ticket—which is a fancy way of traveling to multiple countries on one ticket at slightly discounted prices. Without alliances, this kind of ticket could not exist.

Each alliance has a major leader—for Oneworld, that leader is American Airlines.

Each alliance has a major leader—for Oneworld, that leader is American Airlines. Image by Flickr user Cory W. Watts.

The Success of the Alliance Business Model

When evaluating the impact of airline alliances, it’s important to look beyond the obvious. These company coalitions hold immense power over the industry and manage to influence the workings of nearly every airport you’ll set foot in.

The main way alliances maintain their smooth international travel is by utilizing shared terminal space. This is a perfect cost-saving strategy for big airlines, but it’s hard on smaller carriers who don’t receive the same advantage. Alliances also engage in cooperative scheduling, which shortens your flight times generally. Layovers are briefer and empty legs are cheaper and smoother—and if you’ve ever flown open-jaw with multiple airlines, you understand why this is necessary.

The same plane may be running flights for multiple alliance partners during a single segment.

The same plane may be running flights for multiple alliance partners during a single segment. Image by Flickr user Camilo Rueda Lopez.

Within an alliance, you also have the option of many more departure times. Need a flight from JFK to Heathrow? When you could fly with Delta, Air France, or KLM, your possible flights triple compared with Delta alone. Code-sharing allows multiple partners to fly on the same ticket and the same plane—perhaps with different flight numbers—and baggage interlining allows all your baggage to smoothly arrive with you.

As a business traveler in the United States, there are definitely a few big perks to flying domestically under the alliance system. All alliance rewards members have access to lounges of the partner airlines, which vastly widens your network. I particularly enjoy the ease of shared rewards programs. An Executive Platinum membership with American Airlines gives you the same benefit as British Airways Gold—both equate to Oneworld Emerald status and receive priority check-in and faster security. The partners make it easy to determine which benefits you qualify for using the Oneworld tier status tool. If only transferring miles and credit card points were that simple!

As a flyer with any Star Alliance airline, you get access to Singapore Airlines lounges.

As a flyer with any Star Alliance airline, you get access to Singapore Airlines lounges. Image by Flickr user nakedsky.

The Anti-Alliance Trend

For some reason, when an airline leaves one alliance for another, it’s an incredibly newsworthy event. As far as I’m concerned, they’re just shifting sides on the same poker table. However, what’s more interesting is the current trend of not joining an alliance at all.

Among the airlines that have not joined ranks are Virgin America, JetBlue, Spirit, and Southwest. Emirates is also in this group and tends to be the most outspoken in their claims against the system. Emirates “refuses to join any global alliance,” claiming their operations would be limited. The independent airlines listed here manage to be successful despite pressure from the alliances—particularly Emirates, who recently won Skytrax’ Best Airline Award for 2016.

However, the “have nots” of this community are the smaller carriers who desperately struggle to compete. Without the help of an alliance to purchase terminal space, share facilities and resources, and provide bargaining power, non-legacy carriers such as El Al (Israel) can barely make a profit.

Due to the growing global influence of the three alliances, I don’t see how these airlines can remain independent for long. If they end up losing their edge (or their profits), they’ll have no choice but to join one of the three alliances in order to stay in the air.

Emirates is perhaps the most successful airline that’s not tied to an alliance.

Emirates is perhaps the most successful airline that’s not tied to an alliance. Image by Flickr user Roderick Eime.

How Business Travelers Can Work Within The System

Here’s what you need to know: airline alliances aren’t going anywhere anytime soon. If your favorite airline shuffles to a new one, you may want to consider your international partnership opportunities before following them in the switch. Your domestic airline of choice may not have the international partners you need—and your reward points won’t be useful when you need them.

As with credit cards, I prefer to join programs that give me flexibility in using my rewards points. I don’t like being tied down to one brand. That’s why I think the airline alliance system works for business travel—and also why I’m a member with JetLux Hotels. Unlike most corporate travel programs, JetLux isn’t restricted to any particular hotel chain, yet I still get discounts up to 40% off each stay. Reach out to us to learn more about how you can make your hotel membership work best for you, no matter where you fly.

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