At the moment you are correct. Before we go any further, lets agree not to use silly arguments such as use AI sucks Skyteam sucks, DL sucks. It leads to endless arguments and baseless accusations such as Yaatri wants AI to join Star Alliance, eventually leading to the thread being closed.
Lets leave it at AI is bad but LH is not perfect.
What remains to be seen is
Who blinks first between AI/GoI and Star Alliance
How badly AI/GoI want to be in Star Alliance
It was reported in
What went wrong with Air India's entry into Star Alliance? that
Of the 27 member airlines at Star Alliance, 25 voted against AI in July when the airline was due to join the global network.
.
The Ministry of Civil Aviation and AI officials had expectations entirely at odds with this.
AI still has the option of joining Skyteam. provided they are willing to accept, that for whatever reasons, they were not good enough in the eyes of member airlines of Star Alliance. The smart thing for AI would be to go for Skyteam. Frequent Flyers of member airlines of Star Alliance weren't going to give AI what it so desperately needs and wants.
- If Skyteam picks 9W over AI and 9W gives up on Star Alliance, in case of retaliation by GoI and in view of the threat issued by GoI, "Only one airline (AI) in *A or none", AI, LH and Star Alliance are losers.
- If GoI retliates by insisting on its threat "Only one airline (AI) in *A or none", and AI joins Skyteam, 9W, LH and Star Alliance would be losers.
- If AI and 9W continue to wait hoping to be allowed into Star Alliance, AI, 9W and Star Alliance would be losers. AI, 9W and Star Alliance and Skyteam would be losers.
- If AI joins Skyteam, 9W decides, reluctantly to join Skyteam, and GoI/AI allow that to happen to spite Star Alliance and LH, accompanied by retaliation against LH, LH and Star Alliance are losers yet again.
- If AI quietly joins Skyteam and allows 9W to join Star Alliance, but retaliates against Star Alliance and LH, Star Alliance, LH and to some extent 9W would be losers.
- If GoI gives in Star demand and lets 9W join in exchange for its own admission, Skyteam loses.
Star Alliance is the biggest loser in 5 scenarios above, LH in 4, 9W in 3, AI in 2 Skyteam is a loser in only two of the six scenarios.
IMHO here is the list of losers in order of biggest to least.
Star Alliance
Lufthansa
Jet Airways
Air India
Skyteam
Alliances are not as important an entity as airlines in my opinion, as a good alliance has bad airlines. In a losing situation Lufthansa is the biggest loser and DL the least, as LH stands to lose what it has, while DL just won't get what it doesn't have.
As to Mallya, he will have plenty of opportunities to open his big mouth and embarrass himself. BLR-SFO nonstop anyone? It doesn't even fly to NA yet.
Finally one little question. Is their a minor alliance?