JetBlue and Lufthansa want to start a code share, how does that effect CO in the *A?
 

There is a link to the Jetblue forum--> http://www.flyertalk.com/forum/jetbl...ode-share.html

Or read the USAToday story, my post concerns the question at the end, what is the reaction by the *A partners, that now includes or will include us.

ORIGINAL POST: Lufthansa and JetBlue are expected to file regulatory approval for a codeshare alliance that would let the carriers put their codes on and sell seats on each other’s flights, the Financial Times reports. The Times, which cites "people familiar with the matter," says the carriers could file their request with the U.S. Department of Transportation as early as today. The New York Times also reports on the deal, though it also cites "people with knowledge of the agreement."

The Financial Times writes that "by marketing JetBlue’s flights as its own, Lufthansa would broaden its footprint at John F Kennedy International Airport" by giving its passengers connecting options on JetBlue flights to more than 50 destinations in North America and the Caribbean. For JetBlue, the tie-up would allow JetBlue to sell passengers tickets with connections to Lufthansa's trans-Atlantic flights via New York JFK – and possibly other airports, such as Boston Logan, Orlando and Washington Dulles. The New York Times says the pact would "allow JetBlue to market flights to European destinations for the first time."

Speaking to the New York Timesearlier today, Lufthansa spokesman Boris Ogursky says the two carriers are "evaluating the possibility of a customer-oriented cooperation," though he declined to comment further.

One question yet to be answered: How will Lufthansa's Star Alliance partners United, Continental and US Airways feel about Lufthansa's request to partner with a U.S. low-cost rival?

This was pretty much known it would happen, I'd expect B6 to be a *A member next year in fact, LH owns the max legal limits on them to my knowledge.

This one is interesting. I would have thought that a big part of the draw for CO to join Star would be that they are so strong in NYC, so they would get a huge amount of traffic coming through them. In Skyteam, CO/DL both offer huge service in NYC area.

With LH code sharing with B6, I would have thought that CO would be livid.

well with BOS I dont see much for CO to crow about.

As for NY well B6 doesnt have RJs on the routes it flys, so If I was going to fly 2 Carriers and CO served my destination with an RJ or Q , hello B6

Now although it did mention Florida, well doesnt LH pretty much have that already covered with its non-stops? and if anything shouldnt UA & US be the ones complaining more then CO, after all instead of flying say FRA-PHL-FLL , a person can now go FRA-JFK-FLL LH/B6

Then maybe its LH that should be complaining as now with CO a person can fly to EWR and then to alot of the European cities which till now then needed to grab a LH flight to get to. Or why fly BUF-PHL-FRA-MXP when you can now go BUF-EWR-MXP. (yes AZ flys to MXP as does DL etc but no *A Carrier till CO comes on board flys non-stop from the US

Then CO left JFK so what should LH do leave JFK as well, more people chose JFK over EWR. Just as more people chose LHR over LGW if given a choice

In the end it will all balance out, and produce more rev for all the Carriers.

Didn't the Star Alliance anti-trust immunity include trans-Atlantic revenue sharing? If so, how could this possible pass anti-trust?

Ladies and Gentlemen, I welcome you to LufthansaBlue.

Just Kidding :D

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that would be cool though. It might also explain JetBlue's freakishly big terminal, and the connection they built to the old T6. Anyone else thinking Star Alliance Megahub? If not that, then at least a Lufthy hub at JFK?

Incorrect. A foreign entity can control up to 49% of an airline with no more than 25% of voting shares. LH owns 19% of B6.

What does that have to do with anything?

T5 is not connected to T6 at JFK and neither have a FIS. In addition LH owns 25% of T1. Neither one is going to move.

--I did in fact mean to say "built so that they could be connected". But I guess you are right when it comes to Lufthansa's share of T1, unless they plan on a huge expansion in NY.

It actually is not all that large for the operations that jetBlue has at JFK. They have 25 gates. They operate ~250 flights a day. Putting 10/gate/day through doesn't leave a whole lot of slack for when things go wrong.
T6 is essentially useless. If that space gets used for anything I'd expect it to be razed and rebuilt from scratch. And there is no way that LH moves from T1 right now.

As for the impact on CO, minimal, IMO. There are more than enough people out there that LH is connecting through NYC to various destinations and they have significant service at both airports. There was no way that LH was ever going to move wholesale to EWR and route everything through there so this isn't all that big a deal, IMO.

CO makes a good fit in *A because of its Latin routes.

*A has a big, gaping hole in Latin America, and CO fills it quite nicely. The two Mexican carriers that could fill this hole are in Oneworld or SkyTeam. Smaller, non-alliance carriers like Taca have hubs in places that likely won't support long-haul traffic needed for connections (anyone for FRA-SAL or NRT-SAL?). And a carrier like TAM has a hub that can be significantly out-of-the-way for many connections.

So CO is a very good fit for *A.

As for the EWR hub, while bringing CO's customers to the alliance will benefit the alliance as a whole, most destinations CO offers out of EWR are presently served by the alliance.

I don't think LH is connecting much traffic in NYC at the moment. People flying LH to major markets are probably flying LH to that market (they serve most every major U.S. city). People flying LH and connecting to secondary markets are likely routing via ORD, IAD, DEN, SFO, LAX, PHL or CLT rather than NYC.

But aside from FTers looking to build in extra connections, flying LH to JFK and connecting onwards probably doesn't make a whole lot of sense at the moment.

especially if CO Elites wil be able to grab a E+ seat from get go

If they will be able to,UA flys to FRA & MUC from IAD and thats how I would fly. XYZ-IAD-FRA or MUC and then LH onward or whomever

Back to JFK most *A Carriers go into JFK, I think only SAS has a presence at EWR and not JFK . Most are only at JFK or a couple also fly into EWR. So unless every *A Carrier is gonna switch to EWR whats the big deal.

LH is terrible in Y , I had less leg room then when on CO. OK the seats themselves were padded better but that was it

Craz,

SK, SQ, LH, LO, AC, UA, US, and future member AI all fly into EWR -- nothing to sneeze at.

In any event, the B6/LH linkup is a nonissue. By design, it won't deprive CO et. al. of any premium ticket sales.

well drop UA and US as I thought we were talking about Intl carriers at least I was.

TK,OS,LX,SA,MS,CA,NH,OZ,TG (used to) go Only to JFK

LH,SQ,LO go to both JFK & EWR

TP,AC,SK go only into EWR (although AC does go into LGA)

also a number of UAs partners that arent *A members also only fly into JFK

Correct. Because there are no connection options today. Adding those options is a good thing for customers and LH customers are about to have two options - EWR on CO or JFK on B6. That's a great thing for them.

It does for the cities that they are starting with. Cities like PBI, AUS and SJU are all just fine for using JFK as a connection point rather than the existing UA/US options.

According to an artice in today's New York Times (http://www.nytimes.com/2009/09/01/bu...bal/01air.html), the code shares are only available to 12 American cities. That's nothing, I would expect this to have little, if any, effect on CO.

Plus, with LH flying into both JFK and EWR, they want the connections for their pax from both NYC airports. I don't think one should reasonably expect just because CO will be in *, that all international * carriers would drop service to JFK, and go excusively to EWR. CO may wish that and AC has done this already but it was a while ago, and I'm not sure that was all, or even mostly about CO connections, but more about cost considerations since it only had 2 daily JFK flights and was contracting UA out for all ground ops, but could put those flights into its EWR ops). It doesn't make sense for the international carriers, who need a JFK presence too.

This has always bothered me. So put in a codeshare agreement and new demand is magically created, driving incremental revenue? I don't think these codeshares grow the market, so the revenue is coming from somebody else.

I ddint say that the market will grow persee, but that as you put it, that the % of the market can grow in *A favor

Sometimes it will be due to the timing of the flights, or type of equipment being used.

I have an Intl trip today where Im stuck with a 4 hr layover, free Biz tkt on DL. If I was purchasing that tkt Id look at all the other choices where I can get in before 1pm to my desination and the least amount of layover between flights, also my connecting flight is on a Regional something I wouldnt usually go with.

So now people flying to/from or Via Europe can see if B6 will help them save time or keep off Regionals. At present with either EWR or JFK a change of Terms will be required. I prefer a smooth transfer so I would probably not look at either JFK or EWR if that wasnt either my O/D and if I wasnt looking to spend some time in the NY area.

But thats me. Id sooner fly to/from MIA as much as I prefer FLL, then to have to connect anywhere. Some times theres no choice.

But anything that will add to our ability to choose different possible routings and possibly save $$ or get a free tkt cashed in on, I say "bring it on !'.

Yeah, but this will just be offset by other alliances putting in their own codeshare agreements to try and steal traffic back. I wasn't taking issue with your statement per se, but rather the airlines always seem to claim that these agreements increase revenue. I just don't understand how or why, unless they grow the market, which I don't think they do...

Or they will change the type of equipment they are using.

sort of like CO moving the 777 to *A hubs from ST hubs and replacing the 777 that went to ST hubs with a 762 or 764 or 752. Or cutting it down to 1 flight from 1+

Could be where CO will now use planes with less capacity, ST Carriers will OpUp theirs. So w/o having looked at whom uses what , say DL might use a smaller plane to FRA or MUC and change its flights into the ST hubs.

Or they can go all out and Declare WAR :D and it will be MRs a Plenty, then more people will fly , more seats will be filled, but most likely it will result in a neg affect on the bottom line

Well, it's the reach, and yes, the revenue is coming from somebody else. The hope is it's from a non-alliance competitor.

Let me be the first to welcome you to ConUniBlueLuft!

(the new version of ConUniHound).

Seriously, given that LH could own up to 49% of B6 as long as its shares had voting rights <=25% (kind of a "tarnished share" vs. a "golden share"?), could LH funnel enough money into B6 to fund B6 acquiring UA? Or funding a domestic JV of B6/CO/UA?

After all, B6 already has E+ :)

I actually think this would be a good idea. B6's 320 fleet compatible with UAs, essentially similar to the 32S all-E(+ & -) ex-Ted version. B6's service levels being better than UA's, similar to CO's higher quality service (not counting irrops!). B6s' 320s and 190s fill the gap from UA's ancient 733/735s being retired, and the 190s especially provide some right-sized small-mainline lift flown by mainline pilots to replace the crummy UAX and CO Express/Connection carriers. You end up with a modern narrowbody fleet of E190, A320/319, and 737NG aircraft for right-sizing.

Wind down some duplicated domestic and international routes, rationalize the 767 and 777 routes between UA & CO, new combined airline has the UA full-flat AVOD C seats, keep the new-C 744s for as long as they make sense for certain missions.

UA pilots are happy because UAX gets wound down, mainline ALPA pilots flying E190s like they've suggested for years. CO pax are happy because E190s and a few of UA's UA-owned UAX-op CR7/E70 with F are a whole lot nicer than E145 and Q400 regionals. *A is happy because they now have a powerhouse set of hubs in the NYC area for both domestic and International, as well as a very strong North American network. Everybody's happy.

Except for US, as there's no longer any rationale for them in *A :) Even if they are still in for 5 years, they aren't going to be getting as much connecting and codeshare business from UA & LH as before. And DL, because this creates a US-based, 51% US-owned "Premier Global Airline" that can compete strongly against the DL/NW-AF/KL JV.

US would have to vote to approve B6 joining *A, as I believe *A membership requires unanimous approval of current full members. But I'm sure that LH, UA, CO, and B6's lawyers and M&A advisors could structure a transaction where the officially surviving airline would be UA (or CO), which would already be in *A thus not needing the vote. Just like how HP bought US but retained US's name and US's *A membership.

It is 12 cities to start but it will grow. And you should expect that in the future jetBlue will also aim to put their code on LH flights, though that is likely waiting until they upgrade their reservations system to Sabre which is scheduled for later this year and into early 2010. The codesharing will expand, but it still isn't a problem for CO.

No way B6 acquires UA, though that was definitely entertaining to read. Domestic JV is more likely and it is rather unlikely to happen, IMO.


They still offer the best coverage option in the southeast. Not a ton of business there necessarily, but I cannot imagine choosing to cede that to DL which is basically the only other player there. US also has decent coverage in the Caribbean that B6 could probably match eventually but it would take a while to get there.