Goldorak

From the pax perspective, the alliances are certainly better. From DL perspective, they invest in airlines capital and so they can control the partner airlines and influence their strategy and make sure they are serving their interest. On top of that, a JV agreement allows airlines to coordinate schedules and pricing and share revenues and loss without breaking anti-trust laws.
In a non-capitalistic alliance like ST, *A, or OW, airlines are cooperating on certain things, but they still compete. And there are also high fees associated with the alliance membership.

siw

Why would DL have joined up with AF, AM and KE to form an alliance all those years ago then when it does not work like a joint venture (I know they took over from North West which had a partnership with KLM before AF-KL formed)? Why don't we have the other member airlines (e.g. AF with VN that don't involve DL) saying they are building their own partnerships, like we hear from DL? Again, it seems that SkyTeam exists for the sole benefit of DL and if they don't like it then that's the end of SkyTeam and then other 18 airlines just have to accept that. I assume that the other founder airlines (AF, AM and KE) and bigger airlines in the alliance (KL, MU etc.) have little to no influence in SkyTeam.

Goldorak

It is plainly wrong to say that ST exists for the sole benefit of DL. DL was one of the founding members of ST along with AF, AM and KE. Other partners in ST have also JV arrangements. For instance AF has a JV with MU, another one with VN. KE has a stake in OK, etc etc.
The 3 alliances were founded a while ago now and times are changing. The alliances have not delivered all their promises to passengers due to lack of willingness from the members. DL CEO is not the same as 20 years ago and sees things differently than some of his predecessors and the environment has changed. DL is also super rich and this is giving them the possibility to make their shopping, not without a bit of arrogance I would say.
I don't think *A and ST will end anytime soon, but I don't see any significant member joining any alliance. All the recent significant partnerships have been through capitalistic cooperations and/or JV. OW is likely the most endangered alliance because of:
- the extra-alliance partnership QF/EK
- QR, member of OW and having a stake in IAG, is at war with AA that has a JV with IAG.
- LATAM leaving OW to go in bed with DL is a huge loss for OW
- CX is in serious troubles with the current civil unrest in HKG and the political "game" having led to the resignation of CX CEO
- CZ is in the process of leaving ST after having signed a cooperation agreement with AA, but has not given any sign of willingness to join OW

And note that VS is not joining ST despite being own in majority by DL and AF. And it has never been said that LATAM will join ST. DL is clearly not in favor of them joining ST.

ClipperDelta

DL does not have majority control of VS (49% stake) or LATAM (20%) and does not dictate overall alliance strategy to its partners. Of course, DL is not a huge fan of large alliances like SkyTeam so it is not going to go out of its way to ask VS or LATAM to join Skyteam if VS or LATAM do not show any interest in doing so. And VS and LATAM know that the smart play these days is to partner with carriers who can best benefit them regardless of alliance. LATAM has consciously said it has no plans to join Skyteam because it still wants to maintain the flexibility and ability to partner with any airline it wants to - thus allowing it to maintain its relationship with QF across the South Pacific, and with IB (for a South American airline, Spain is arguably the most important European country, hence a relationship with IB is far more valuable than trying to go with AFKL or another European carrier). Again, Delta is not and cannot tell LATAM to join Skyteam or any other alliance...

siw

Bold is mine.

As alliances are better than JV for passengers (more routes, shared FFP benefits etc.) then why don't the airlines fix the issues with SkyTeam? That would bring in more passengers, yes?

siw

Yet, it was DL (with AF, AM and KE) that started SkyTeam. It just seems odd that rather than fix SkyTeam that DL blocks Virgin Atlantic, WestJet and LATAM from joining, giving passenegers wider network connections, FFP links etc.

hfly

Westjet? Who cares. VS? Once AK/KL finished their deal to own 31% of VS, and the JV is given final approval, then you will see VS join Skyteam (also noting that DL owns 8.8% of AFKL), nothing at all before. LATAM? probably will join eventually, but that is all new, and as others note, it's only a 20% stake. Everything that DL does reason. Remember when they practically blackballed KE? Look at it now.

Goldorak

It’s not just within Skyteam, but for all alliances.

I am 99% sure that VS will not join ST (same for Latam). VS doesn’t need the JV to join ST and so they could have joined it for several years already if they had wished. In fact, I remember an article published at the time DL took its stake in VS in which VS CEO was saying he’d like to join ST, but as it never happened, I am sure DL blocked it because of the associated costs and uncertain return on investment.
What will happen once the JV will be approved is a VS-AFKL agreement for reciprocal benefits for members of each carrier FF program.

T.A.Music

With Air Europa quitting SkyTeam soon and folded under Iberia, don't you think SkyTeam needs LATAM more than ever, despite Cueto's insistence of not joining? Just saying.

Also, regarding VS, DL can block even though it doesn't have to (although, Delta's 49% are just 'non-controlling' in paper only), but VS CEO changes over time, so one CEO can say yes, other can say no. Also, the airline business trend often shifts, courtesy of QF/EK alliance as a starter. The inactivity of SkyTeam is also dreading as well. (Just this year, OW is recruiting RAM, *A and OW is activating ST's LCC/hybrid membership idea with airlines like Juneyao, Thai Smile, Fiji Air and soon Alaska)

With AFKLDL now owns 80% of VS, there is a chance, but slim, as CEO Craig Kreeger said, “There might be a time when it makes sense.”

Also, Ed Bastian recently complained that airline alliances no longer deliver the benefits they should (Honestly, Ed, the airline alliance hater, could took over ST and fixed it to his liking rather than just complaining, although joint-venture makes more sense!), while IAG chief Willy called alliances a "poor substitute" for genuine merger and acquisition activity, adding that alliances have a "role to play" but their structure is "too fragile" (this came from a guy who supports the existence of airline alliances).

hfly

Really Air Europa? Look, I am a DOUBLE Skyteam Elite Plus for life, and other than being FIM'd onto them once in an extreme IRROPS situation, my response is "Air Europa who dat?"!!!!!!!!!

Goldorak

UX and LA are not equivalent. UX is primarily a European airline serving a few long-haul destinations in LATAM, while LA is a South American Airlines serving a lot of regional and US destinations and a significant number of long-haul destinations (but relatively few in Europe).
LA would be a great addition to ST, but I doubt it will happen anytime soon.

Goldorak

Frankly, what those LCC will bring to an alliance is really minimal, although I agree it’s good to have a lighter membership option. ST had this some years ago (associate membership), but they dropped it because the concerned airlines were complaining to be 2nd tier members with less rights and benefits. IIRC, UX joined with that kind of scheme.
And about OW, they may have added RAM, but this is IMO the most fragile alliance, due to the very deleterious relationships between some of the most important members. Add to this CX that is suffering a lot with the HK situation...

T.A.Music

Actually, you are correct, Goldorak. Back then, SkyTeam Associate exists with KQ, UX and Copa (now a full member of *A).

I do agree with your statement regarding OW. I mean, looking at what’s happening inside OW alliance is nothing but a messy frat house full of disagreements, and current American Airlines‘ kitchen is a mess (Messier than The Vixen’s mind). How long do you believe it will take for OW to dissolve?

Hypothetically, what happens if DL decided to restructures SkyTeam into something like Etihad Partners (and kicking out members that it didn’t own its stake, like Aeroflot, GA, VN, CI)?

Goldorak

I don't think they are at that point, but the next 2 years will be crucial for sure.

DL doesn't have this power, but they may eventually decide to leave the alliance. Would that happen, ST is dead of course. They may also decide to change their internal rules, membership options, allowing some partnering outside the alliance, etc. This is a more likely option IMHO

T.A.Music

The only option SkyTeam have, IMO. SkyTeam definitely doesn’t want to lose their North American partner, so they have to do this option. Otherwise, the alliance will be rendered irrelevant to the current tides of the commercial aviation industry in a few years.

That’s why... ED BASTIAN! Get your ... down here! Walter Cho/Kristin Colville is a lazy ... who literally helpless as a Chairman/CEO duo!