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Air India and the Star Alliance (Part II)

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Air India and the Star Alliance (Part II)

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Old Jul 29, 2011, 10:03 am
  #211  
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Originally Posted by oliver2002
AI sold their rights on the bilaterals to Switzerland and Austria for cash, just to give an example.
So in order to be on the nice side of AI you had to offer some nice things. Same goes for the concessions LH made to allow AI use of FRA as a hub to north america.
Without getting into a debate on the economics of selling bilateral rights, I have to say that while selling unused rights could be short sighted, but if I the rights are sitting idle, it might not be such a bad idea. provided it's done on a contingent basis and on terms that have to be renegotiated every few years. AI has never used its frequencies under bilateral with Netherlands and allowed KLM to use its frequencies in the past. It has also allowed SU to use its unused frequencies.
Originally Posted by oliver2002
Times are changing rapidly and I'm sure LH is confident enough to cut some cords, especially since alliances with AI are not helping to stop the gulf carriers steal market share to north america and europe.
If that claim/assessment is correct, then it's no reason for LH to support AI's admission into Star Alliance. Is LH only going through the motions, teasing AI, with no intentions of letting AI score?

Originally Posted by oliver2002
It doesn't make sense for SQ or EK to use their flagship A380s into India. For such short haul hub connections they rather use high lift high density configs like the 772.
I agree with the this. It's quite obvious that operating A380 on such a short route is silly.

Last edited by Yaatri; Jul 29, 2011 at 10:12 am
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Old Jul 29, 2011, 10:17 am
  #212  
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Originally Posted by B747-437B
Air India's value to Star Alliance is NOT for the ULH nonstop India-North America routes that are pretty much the only longhaul that Air India operates today.

The real value is the spoke access to the Tier 3 cities in India which are increasingly generating more and more demand for longhaul. He who has the codeshare on Air India metal to Kanpur or Vizag or Guwahati will gain by capturing the longhaul traffic share. Right now, its up for grabs at the gateway. Getting Air India (or any other Indian carrier) into Star means that traffic flow is now captive.

The Star carriers know that Air India is not a threat to their bread-and-butter markets to/from India. They need Air India to feed those services. Conversely, Air India knows they cannot serve every market with marginal demand from India as a spoke (while the Star carriers can as a hub). Hence, Star has a value to Air India.

It's all about the feed. Air India isn't a global player and will never be one. There is no threat, other than to Star Alliance's image by association with
I quite agree with the most of your post except, what star alliance gets and wants out of AI is one thing but what LH gets and wants out of AI is yet quite another, which, I think, is the reason why some star members are opposing AI's entry.
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Old Jul 29, 2011, 10:28 am
  #213  
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Originally Posted by oliver2002
AFAIK LH has already been tapping the tier 3 markets with fares that incorporate AI/9W as a feeder... for example:

Code:
29JUL11**29JUL11/LH NAGWAS/NSP;AT/TPM ...../MPM 10418                           
LN FARE BASIS    OW   INR  RT   B PEN  DATES/DAYS   AP MIN MAX R                
21+VRCOWAAW     36915           V  +     -     -   +  + 3+  -  R                
22 QRFAAW                 72425 Q  +     -     -   +  + -  12M R                
23+WRCOWAAW     32715           W  +     -     -   +  + 3+  -  R                
24+VRCAAW                 63425 V  +     -     -   +  + 3+ 12M R                
25+WRCAAW                 56425 W  +     -     -   +  + 3+ 12M R                
26+SRCAAW                 48425 S  +     -     -   +  + 3+ 12M R                
27+TRCAAW                 43425 T  +     -     -   +  + 3+ 12M R                
>                                                 PAGE  3/ 3                    
>fqr 27
FQR 27                                                                          
29JUL11**29JUL11/LH NAGWAS/NSP;AT/TPM ...../MPM 10418                           
***   FOR STAR ALLIANCE RTW* SEE FQD XYZXYZ EG:FRAFRA   ***                     
LN FARE BASIS    OW   INR  RT   B PEN  DATES/DAYS   AP MIN MAX R                
27+TRCAAW                 43425 T  +     -     -   +  + 3+ 12M R                
>                                                 PAGE  1/ 2                    

ADDON  LH0409  SPECIFIED  LH0409  ADDON          EFF21JUL11                     
  1 * NAG-LH/9W/AI-PNQ/BLR/CCU/HYD/MAA/BOM/DEL-LH-MUC/FRA-                      
      LH-VIE/DEL/BOM/MAD/BCN/LIS/ROM/MIL/STO/OSL/CPH/BFS/                       
      BRS/GLA/EDI/MAN/BHX/LON/SNN/DUB/BER/HAM/DUS/MUC/FRA/                      
      PAR/GVA/ZRH/BRU/AMS-LH-YTO/YMQ/NYC/BOS-AC/CO/UA/LH-                       
      WAS/CHI/CLE-AC/CO/UA/LH-WAS                                               
  2 * NAG-LH/9W/AI-PNQ/BLR/CCU/HYD/MAA/BOM/DEL-LH-MUC/FRA-                      
      LH-VIE/DEL/BOM/MAD/BCN/LIS/ROM/MIL/STO/OSL/CPH/BFS/                       
      BRS/GLA/EDI/MAN/BHX/LON/SNN/DUB/BER/HAM/DUS/MUC/FRA/                      
      PAR/GVA/ZRH/BRU/AMS-LH-PHL/NYC/YOW/YMQ/YTO/YUL/YHZ/                       
      BOS/DTT-AC/CO/UA/LH-WAS                                                   
  3 * NAG-LH/9W/AI-PNQ/BLR/CCU/HYD/MAA/BOM/DEL-LH-MUC/FRA-                      
      LH-VIE/DEL/BOM/MAD/BCN/LIS/ROM/MIL/STO/OSL/CPH/BFS/                       
      BRS/GLA/EDI/MAN/BHX/LON/SNN/DUB/BER/HAM/DUS/MUC/FRA/                      
      PAR/GVA/ZRH/BRU/AMS-LH-WAS                                                
>
What would AI contribute in case they are more in bed with LH? Sales force? Not likely. What else... I'm really trying to find synergies here...
Almost all U.S. carriers, including US,UA, AA and Co published fares to Indian cities, when DL was the only airline with frequencies to India. Existence of a published fare means little.
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Old Jul 29, 2011, 10:43 am
  #214  
 
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Originally Posted by oliver2002
What would AI contribute in case they are more in bed with LH? Sales force? Not likely. What else... I'm really trying to find synergies here...
Captive point of sale.

AI also provides feed to Air France, British Airways, Delta and everyone else.

By locking in Air India, Star Alliance gets the best SPAs and importantly, the foothold in the growth market POS. He who controls the first sector, controls the revenue. If the growth is in Tier 3 cities, the plating carrier is usually the carrier serving the Tier 3. That has huge ramifications on cashflow and leverage for SPAs.

It's network planning 101.
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Old Jul 29, 2011, 12:08 pm
  #215  
 
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Efforts on to keep Air India’s date with Star Alliance

http://www.mydigitalfc.com/news/effo...r-alliance-256

Officials of civil aviation ministry and Air India met Star Alliance executives here on Friday ahead of a crucial board meeting of the 27-airline grouping to decide on the entry of the Indian national carrie into the alliance. Officials were tightlipped on the outcome, but indicated that the meeting would continue on Saturday.

A vote on Air India’s entry into Star alliance is expected to take place on Sunday. But indications are that some members in the alliance were opposed to the entry of Air India in view of the open skys policy of the government. Dominant members of the Star Alliance include Lufthansa, Air China, United Air Lines and Air Canada.

But ministry of civil aviation officials said that the carrier had options of joining other international alliances. This was especially in view of threats made by Star Alliance that they could withdraw the invitation to Air India.


Now we know why some members are opposed. They want the Govt to give them more access to Indian airports. If the Govt does oblige I guess AI can take another decade to fulfill the requirements and *A will be waiting to welcome them with open arms.
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Old Jul 29, 2011, 1:04 pm
  #216  
 
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Originally Posted by flyjet787
Efforts on to keep Air India’s date with Star Alliance


Now we know why some members are opposed. They want the Govt to give them more access to Indian airports. If the Govt does oblige I guess AI can take another decade to fulfill the requirements and *A will be waiting to welcome them with open arms.
I don't know why people seem so determined to find ulterior motives for some *A members being prepared to veto AI. Isn't it enough that they are simply still not ready after being an incredibly generous length of time? Why does there have to be a conspiracy behind the disinclination to take on a member who is not operationally ready to join the alliance?
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Old Jul 29, 2011, 1:17 pm
  #217  
 
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Originally Posted by kiwiandrew
I don't know why people seem so determined to find ulterior motives for some *A members being prepared to veto AI. Isn't it enough that they are simply still not ready after being an incredibly generous length of time? Why does there have to be a conspiracy behind the disinclination to take on a member who is not operationally ready to join the alliance?
Because not being ready by the deadline is probably not the reason or *A carriers are trying to make the most of the situation and force the Govt to grant them more access to Indian airports or what ever they want. Under the current circumstances *A can certainly tell AI.. "You're not ready so we will not accept you". But if the Govt of India put an attractive offer on the table would the members reconsider their decision to vote against AI? Or maybe the Govts threat to not let any other Indian carrier join *A going to influence the members vote? Boy, I can't wait till monday
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Old Jul 29, 2011, 1:38 pm
  #218  
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Originally Posted by kiwiandrew
I don't know why people seem so determined to find ulterior motives for some *A members being prepared to veto AI. Isn't it enough that they are simply still not ready after being an incredibly generous length of time? Why does there have to be a conspiracy behind the disinclination to take on a member who is not operationally ready to join the alliance?
That, this has all the elements of intrigue and horse trading and AI's incompetence are two separate issues which are not mutually exclusive.

Why is LH hung up on AI if they have not been ready for 4 years? LH could have walked away any time. Clearly it's a quid pro quo situation and the issue of qualifications is secondary. Had it not been so, AI would have been dumped long ago. Language used by *A CEO"two alliances or none" and retaliatory language used by AI is posturing with both sides, leaving lots of room for speculation and little for the real issue, AI's qualification.
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Old Jul 29, 2011, 2:05 pm
  #219  
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Originally Posted by flyjet787
Efforts on to keep Air India’s date with Star Alliance

http://www.mydigitalfc.com/news/effo...r-alliance-256

But indications are that some members in the alliance were opposed to the entry of Air India in view of the open skys policy of the government.
This is significant. Don't you think this is a stupid reason kiwiandrew? Why should anyone be upset about open skies policy unless they are unhappy with competition.
Isn't free trade good? Do the Star Alliance members want to shut every one else out? Don't you think this is a stupid reason kiwiandrew?
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Old Jul 29, 2011, 2:36 pm
  #220  
 
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Originally Posted by kiwiandrew
I don't know why people seem so determined to find ulterior motives for some *A members being prepared to veto AI.
This is India. Failure is never due to one's own shortcomings but rather due to some conspiracy hatched by those more privileged (or talented) than oneself.

If no such bogeyman exists, blame Pakistan.
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Old Jul 29, 2011, 6:53 pm
  #221  
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Originally Posted by B747-437B
This is India. Failure is never due to one's own shortcomings but rather due to some conspiracy hatched by those more privileged (or talented) than oneself.

If no such bogeyman exists, blame Pakistan.
or UK
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Old Jul 29, 2011, 8:22 pm
  #222  
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Originally Posted by Yaatri
So, it's not picking on AI that's the reason, but losing out to LH and AI.
It's true that *A had many opportunities to wash its hands off AI. But It hasn't. Because LH is pushing for AI's entry. US, probably has no position on AI. CO would oppose it, so would TG, SQ, SAS, AC, Austrian and SWISS. Turkish Airline has been doing brisk business to India since joining Star Alliance. So I wouldn't be surprised if Turkish would oppose AI's entry. Air China might be another opponent. SN would probably prefer 9W over AI. That makes 10 airlines. Of course, I might be completely wrong, and we may never find out who would end voting against AI.
Originally Posted by kiwiandrew
I would be very surprised to have Austrian, Swiss and SN vote against AI if their owner LH is in favour, I'm sorry, but I don't find your reasoning plausible where those carriers are concerned. In any case, you seem to be making the assumption airlines that airlines voting against AI have to be involved in some sort of conspiracy. Couldn't their reported opposition be simply because AI has repeatedly failed to live up to their side of the accession agreement? There is plenty of evidence for the latter and no real evidence that I am aware of for the former.
You can parse my posts to make it look like what was neither said, nor implied. I have stated in the beginning, that it's not Ai is being picked on, but it's a tactic. Why would the big chief make a statement "Two alliance or none", after courting AI for nearly 4 years? I have also never denied that AI has failed. There is a voting procedure to vote AI in or out. Albrecht has taken the fight to the street, juts like AI pilots took their fight to star alliance. Such behaviour on the part of * chief is indicative of posturing.
When I made a conjecture about which airlines might vote against AI, I not only admitted of the possibility of my conjecture being all wrong, but said nothing that you or anyone could take as portraying AI being picked on, unless you have not read my post in entirety, misunderstood it, or are convinced of your pre-conceived notion that I have said that AI is being picked on.

Why would SN, LX or OS vote against AI when LH wants AI in? Proxy for LH is simple answer. When information,such as opposition by certain unnamed airlines is leaked out, there is a reason for that. Improving one's position in the bargaining game. Your mind is set in concrete , that's why you continue to insist that other star members are being blamed for AI's problems, when they are not. All I have done is attempt to guess which airlines might vote against AI's entry. Executive committee could have met as scheduled, voted on AI's entry and declared AI a winner or a loser, without getting into this game of chess with GoI.
Originally Posted by Yaatri
Your point that AI has tremendous clout with the government of India is, if anything, a point in favour of *A members voting for rather than against AI even if they have their doubts. Indeed I would argue that is exactly why *A has not previously shown AI the red flag. I am sure that any other candidate airline making such a poor showing of meeting the agreed standards would not have been given more than 3 years to shape up, they would have been told to get lost long ago.
I am going to state again. All members of an alliance don't have identical interests. THey have shared interests. What's good for LH alone, might not be good for every member of the alliance. LH has tried to turn AI's clout with GoI in its favour. Other airlines, who see LH dominating the India market could resent LH's dominance. Thwy can protect their interest by keeping AI out. So, my dear kiwiandrew, nowhere have I said, what you have tried to put in my mouth. I quite agree that AI has been given many chances which it has squandered and had it been some other airline, it might have been told to go away. Threats such as "two airlines or none" are also unique to this situation. MH was also kept in limbo by skyteam, while members like NW vascillated. MH eventually got tired of skyteam's games and went to one world.While MH's wait was protracted, there were no public threats involved.
Now repeat after me, "What's going on is not victimisation of AI, but horse trading and bargaining through proxy and public posturing which has involved finnacial staus of the airline when that really has never been an issue. It's an issue for Indian taxpayers, not for Star Alliance.
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Old Jul 29, 2011, 8:24 pm
  #223  
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Originally Posted by B747-437B
This is India. Failure is never due to one's own shortcomings but rather due to some conspiracy hatched by those more privileged (or talented) than oneself.

If no such bogeyman exists, blame Pakistan.
Oh come on B747-437B. You know I have never said any such thing. It's simple posturing.
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Old Jul 29, 2011, 8:28 pm
  #224  
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Originally Posted by UA Fan
or UK
Or ISI, CIA, KGB, MI5, MI6, and Mossad. Oh and Tea party, Birthers, neo-cons, Dick Cheney. Osama, too.
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Old Jul 29, 2011, 8:30 pm
  #225  
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Originally Posted by kiwiandrew
I don't know why people seem so determined to find ulterior motives for some *A members being prepared to veto AI. Isn't it enough that they are simply still not ready after being an incredibly generous length of time? Why does there have to be a conspiracy behind the disinclination to take on a member who is not operationally ready to join the alliance?
The only conspiracy that exists is in your mind. Have I said AI is ready, and is being targeted?
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