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Why No African Airline In An Alliance?  
User currently offlineRootsAir From Costa Rica, joined Feb 2005, 4186 posts, RR: 40
Posted (9 years 7 months 4 days 18 hours ago) and read 4485 times:

Hi folks,

Sorry if this subject has already come across..... couldn't find it in the search .


As many of you know, South African has intentions to become a Star Alliance member. However, it does surprise me that given the amount of members, it hasn't joined before.

Its a pity to see no african airline is yet in an alliance. i know many of them by far don't qualify, but some such as Ethiopian, EgyptAir, royal Air Maroc and of course south African are potential members.

Could anyone clarify me on that question

[Edited 2005-03-02 11:00:09]


A man without the knowledge of his past history,culture and origins is like a tree without roots
12 replies: All unread, jump to last
 
User currently offlinePM From Germany, joined Feb 2005, 6926 posts, RR: 63
Reply 1, posted (9 years 7 months 4 days 17 hours ago) and read 4433 times:

It seems odd that Kenya Airways are not in Skyteam. KLM have a substantial stake in KQ and the airline offers a good service on brand new aircraft (including 737-700s, 767-300s, 777-200s).

User currently offlineGabrielz From United States of America, joined May 2004, 85 posts, RR: 1
Reply 2, posted (9 years 7 months 4 days 17 hours ago) and read 4421 times:

If I had to guess:

Because SA has such a dominant position in the South African (and general African markets for that matter), they didn't really see the value-add in joining an alliance for some time. That is to say: whether or not they were part of an alliance, they would get the lion's share of revenue in Africa simply because they are a world-class airline (in a region that is sorely lacking those) and owing to their route network. Their old strategy was to do codeshare agreements with various players that could deliver short-haul feed to their JNB hub and CPT endpoints. Hence, the deals with LH and DL.

In addition to the changes brought about by privatization (and the obvious, eventual liberalization of African skies), I think SAA saw entering an alliance as a move to avert direct competition from the group that would be most likely to try and eat their lunch: Star. Also, the move will hopefully increase overall the number of people flying to South Africa for tourism - which is where most of their medium-term growth needs to come from - the historically important South African diaspora market having levelled off in size. You will note, however, that SA's entry into Star isn't exactly moving along at the pace of some of the other airlines - I'm not sure this is a huge priority for them.

As for the other African airlines - they are largely unfit to join the major alliances. If you've had the "pleasure" of flying carriers like AT, you'll know what I'm talking about. Possibly the only place they could reasonably go is SkyTeam: the alliance for the "rest of us".

Now, more intriguing: why haven't the gulf carriers joined an alliance? Are they too competitive? Too subsidized? Is there a need? I think the rumours about AI joining Star and the eventual addition of a Chinese carrier to Star will hasten the joining of EK or another gulf carrier into the alliance.

Star will be *gigantic* within the next few years. Luckily for them, service consistency across the alliance isn't exactly their strong suit.  Smile



User currently offlineBackfire From Germany, joined Oct 2006, 0 posts, RR: 0
Reply 3, posted (9 years 7 months 4 days 15 hours ago) and read 4332 times:

There's two simple reasons why African airlines have been slow to join an alliance:

(i) In terms of traffic demand, Africa is nowhere near the scale of other regions. It's a low-priority area so there's not been any rush by the alliances to attract an African carrier. The whole point of an alliance is to offer connectivity - and there's no point in offering connectivity to low-demand regions.

(ii) There's only two airlines of alliance calibre in Africa - SAA and Kenya Airways. And since SAA is tied to Star and KQ is tied to SkyTeam, both of them are now effectively alliance members anyway.


User currently offlineAvek00 From United States of America, joined Oct 2004, 4391 posts, RR: 19
Reply 4, posted (9 years 7 months 4 days 15 hours ago) and read 4324 times:

For the umpteenth time:

Joining a major airline alliance is extremely resource-intensive - most airlines come out farther ahead by sticking to strong bilateral codeshares vs. paying the piper to slap a marketing sticker on the side of their planes.



Live life to the fullest.
User currently offlineOrion737 From , joined Dec 1969, posts, RR:
Reply 5, posted (9 years 7 months 4 days 14 hours ago) and read 4298 times:

Gabrielz, I have flown AT many times and always received good service. At least they feed you on a 3 hour flight, unlike US carriers! The carrier is well run and has a modern fleet.

User currently offlineCornish From United Kingdom, joined Feb 2005, 8187 posts, RR: 54
Reply 6, posted (9 years 7 months 4 days 14 hours ago) and read 4266 times:

With relatively small numbers of high yield passengers, many African carriers do not make attractive alliance partners. Code share agreements yes, full alliances no. As has been mentioned only SA and KQ are realistic alliance airlines and both are tied into star and skyteam (albeit KQ not as a member) respectively.

There are some important high yield markets in Africa particularly to oil markets (A VS contact once told me that Nigeria was their most lucrative route of all) but the business traffic for these routes will always fly on a known (to them) European carrier than an unknown African one - regardless of whether it could be in an alliance or not.

A high level of VFR traffic is not sufficient for alliance membership - which is why with the exception of SA allaince membership is unlikely for an others (except possibly KQ) for the foreseeable future.



Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
User currently offlineEurostarVA From Bahrain, joined May 2002, 1296 posts, RR: 7
Reply 7, posted (9 years 7 months 4 days 12 hours ago) and read 4194 times:

>Now, more intriguing: why haven't the gulf carriers joined an alliance? Are they too competitive? Too subsidized? Is there a need? I think the rumours about AI joining Star and the eventual addition of a Chinese carrier to Star will hasten the joining of EK or another gulf carrier into the alliance.<

Because airlines in the Gulf view major alliances as a threat to their own explosive growth. You will note that Emirates has been mulling an alliance for quite a long time, but seems to be discouraged from any committments it may have to take to feed other world hubs at a time it wants to add new direct flights to destinations that are very far (New York, Auckland, Sao Paulo, etc.)
It makes sense if you ask me. However, Gulf Air, which cannot afford the kind of expansion witnessed at EK or QR, maybe be better off to enter a major alliance to protect its own future and viability in the region.



If there is a will, there is a way
User currently offlineCornish From United Kingdom, joined Feb 2005, 8187 posts, RR: 54
Reply 8, posted (9 years 7 months 4 days 12 hours ago) and read 4182 times:

Quoting EurostarVA (reply 7):
Gulf Air, which cannot afford the kind of expansion witnessed at EK or QR, maybe be better off to enter a major alliance to protect its own future and viability in the region.


GF was rumoured to be in discussions with joining an alliance ( i think oneworld). As you rightly say they cannot compete with EK and QR's seemingly limitless expansion. And now with Etihad doing the same to their Abu Dhabi market, they may well feel that getting additional traffic through being part of an alliance is the only sensible survival strategy.



Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
User currently offlineBackfire From Germany, joined Oct 2006, 0 posts, RR: 0
Reply 9, posted (9 years 7 months 4 days 10 hours ago) and read 4117 times:

You will note that Emirates has been mulling an alliance for quite a long time


Emirates Group vice chairman and president Maurice Flanagan believes the alliances are currently in poor health and not reaping all the benefits that their members had hoped for.

"We look at the alliances from time to time and will continue to do so. So far we have decided that they’re not for us at the moment.

"They are becoming increasingly dysfunctional, with members competing with each other and some thinking, ‘how did we get into this, and how do we get out?’."

Quoted in Flight International last year. Says it all.


User currently offlineTrolley Dolley From , joined Dec 1969, posts, RR:
Reply 10, posted (9 years 7 months 4 days 4 hours ago) and read 3983 times:

Um, actually, Air Kenya and Comair South Africa are in oneworld. They operate all of BA's internal African flights. They are both local airlines that started well before they became speedbirds. OK, splitting hairs, but a lot of previous posts have implied that apart from SA and KQ, there are no African airlines "up to" western standards. These small airlines, with key routes, prove otherwise. They have to operate to the same high standards of BA on a technical and service level.

[Edited 2005-03-03 00:14:41]

User currently offlineJoFMO From Germany, joined Jul 2004, 2211 posts, RR: 0
Reply 11, posted (9 years 7 months 4 days 2 hours ago) and read 3911 times:

ET has the potetial to beeing a nice addition to any alliance. Maybe not so much for Sky, because ET and KQ serve the same market, but ET and Star/One could be a good combination.

User currently offlineETStar From Canada, joined Jan 2004, 2103 posts, RR: 7
Reply 12, posted (9 years 7 months 4 days ago) and read 3899 times:

Quoting Backfire (reply 3):

(ii) There's only two airlines of alliance calibre in Africa - SAA and Kenya Airways. And since SAA is tied to Star and KQ is tied to SkyTeam, both of them are now effectively alliance members anyway.


You are doing such a disservice to reputable airlines like Ethiopian and Egypt Air by making this remark.

Other than the fact that the number of strong African airlines is low, it should be noted that those who currently make part of alliances such as Star and Sky would rather ply the underserved routes on their own, since they would reap all that there is to make. Look at AF and KL in West Africa, where they simply generate mounds of revenue: why share this with others when they are successful on their own? There is also lots to be made by these carriers on their own to places like North Africa, where there is a steady stream of pax to places like Egypt (have you seen the equipment these airlines fly into CAI?). In the case of Ethiopia, for example, while we are aware of the failed attempts made by ET and LH to come to some sort of agreement, they have now come down to a standstill by limiting the number of flights each airline flies to 3 per week: LH wants more frequencies, but is reluctant on sharing any revenue since it does so well on the ADD route. Basically, from what I see, alliances work where there is high competition among a number of airlines, and a few decide to get together to increase their share, which is what we are now seeing with SAA.


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