The empirical analysis of the impact of alliances on airline operations

Kostas Iatrou and Fariba Alamdari

Journal of Air Transport Management, 2005, vol. 11, issue 3, 127-134

Abstract: Airline alliances dominate the air transport industry with the largest carriers belonging to one of the four alliance groupings—Wings,11There has been consolidation of the alliances in 2004 with Wings gradually dissolving as KLM and Air France have effectively merged with the former joining SkyTeam. Northwest and Continental are also joining in 2005. Star Alliance, oneworld, SkyTeam—which represent 56% of world revenue passenger kilometers. Although much research has been carried out to evaluate the impact of alliance membership on performance of airlines, little has been done on the perceived impacts by participating airlines. This paper gathers opinions of all the airlines, belonging to the four global alliances in 2002 on the impact alliances have had on their traffic and on their performance in general. To achieve this, a comprehensive survey of the alliance management departments of airlines participating in the alliances was carried out. The survey examined which type of cooperation among carriers (frequent flyer programmes, code share, strategic alliance without antitrust immunity, strategic alliance with antitrust immunity) have produced the most positive impact on traffic and which types of route (short haul, long haul, hub–hub, hub–non-hub, non-hub–non-hub) have been affected the most. In addition, the respondent airlines quantified the effect alliances have had on specific areas of their operation, such as load factors, traffic, costs, revenue and fares. Their responses are analysed by alliance groupings, under airline and under geographic region to establish which group, type of carrier and geographic region has benefited the most. The results show that each of the four global alliances groupings has experienced different results according to the type of collaboration agreed amongst their member airlines.

Keywords: Airline alliances; Passenger traffic (search for similar items in EconPapers)
Date: 2005
References: View complete reference list from CitEc
Citations: View citations in EconPapers (32)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jaitra:v:11:y:2005:i:3:p:127-134

DOI: 10.1016/j.jairtraman.2004.07.005

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