As Star unveils Swiss as its latest membership candidate, the alliance is busy recruiting in China, and still hopes it can convince Air China to join.
Star is in detailed talks with Air China, even though oneworld alliance member Cathay Pacific Airways has unveiled its first operational ties with the carrier after forging an equity link late last year. Cathay acquired a 10% stake in Air China at the time of the Chinese flag carrier’s initial public offering in December. The two now say they will extend their ties to cover codesharing on passenger services between their respective home bases in Hong Kong and Beijing, effective from the fourth quarter of this year. Cathay has also secured a seat on Air China’s board.
Despite the deepening links between the two, Star chief executive Jaan Albrecht says his alliance members remain confident an Air China deal can be reached to bring it into the grouping. “The information we have from Air China on Cathay Pacific is that this is a tactical codesharing and tactical frequent flyer deal that they are doing, tactical meaning for the main market between mainland China and Hong Kong,” he said at a recent Star meeting in Nagoya, Japan. Air China officials were observers at this meeting.
“We don’t have really a reason to believe that this co-operation will not allow us to continue pursuing Air China, and actually the interest from their side is very high. This is a complicated and a lengthy process,” he says. “We do not have any reason to believe that this should not materialise. Equity has never been a show stopper.”
Star has meanwhile opened discussions with Shanghai Airlines on a possible future role for it in the grouping. Albrecht confirms that an initial meeting has been held with Shanghai and “we are interested”. It is the fifth-largest Chinese airline group and already has bilateral relationships with Star members All Nippon Airways, Lufthansa and United Airlines.
According to Albrecht: “We can pursue two airlines in a specific country. We have this successfully in the USA with United and US Airways, so if the market is big enough – which certainly China will be – we have flexibility in the governance to allow a dual representation in a specific country. But our main target airline where negotiations are quite advanced is Air China.”
Star has long sought a member in China, but it was taken by surprise last year when Cathay acquired its Air China stake as several Star members have codeshare ties with Air China.
To date only one Chinese carrier, China Southern Airlines, has committed to joining a multilateral alliance, signing last year a memorandum of understanding to join SkyTeam as early as 2006. Speaking at a SkyTeam event in Amsterdam in June, Air France vice-president for alliances Patrick Bianquis said that China Southern could make up for SkyTeam’s lack of a major presence in South-East Asia.
NICHOLAS IONIDES SINGAPORE
Source: Airline Business
