Four members of the SkyTeam airline alliance on July 1 will begin a transatlantic revenue-share program and corresponding "coordinated sales policy" under which individual carriers will sell tickets without preference to the operating carrier. The heightened level of cooperation between Air France, Alitalia, CSA Czech and Delta Air Lines was made possible through antitrust immunity granted to the carriers last year by the U.S. Department of Transportation.
The development follows a similar arrangement launched in January between Star Alliance members United Airlines and Lufthansa German Airlines
(BTN, April 28). Northwest Airlines and KLM Royal Dutch Airlines in 1993 were the first transatlantic partners to develop such cooperation. Their alliance, a joint venture, goes beyond revenue-sharing and is among the world's most integrated international airline partnerships.
SkyTeam predicted transatlantic cooperation will drive $100 million in annual incremental revenue during the next three years. Part of that, the carrier said, will come from joint alliance bids to travel agencies and corporate clients that are expected to draw new clients and drive marketshare gains with existing ones. The carriers said they "have committed to neutral contracts with travel agencies and corporate accounts, whereby no preference is given to any transatlantic codeshared flight" as long as it is operated by a SkyTeam carrier.
Multinational corporate buyers largely remain skeptical of alliance contracts
(BTN, May 12), though a growing number of companies have signed joint deals in the past few years. Such arrangements, while oftentimes difficult to negotiate on a global level, provide corporate travelers with various customer service benefits and integrated loyalty programs.
Meanwhile, European press reports this morning suggested KLM, struggling to decide whether to align with Air France and SkyTeam or take another run at cooperating with British Airways, is leaning toward the former. KLM has not yet announced a decision, but partnerships with Northwest and Continental Airlines strengthen the case for SkyTeam participation as both U.S. carriers are building an alliance with SkyTeam co-founder Delta.
Speculation continued even as BA CEO Rod Eddington this week suggested airlines should focus recovery efforts on an individual level, rather than emphasizing alliance development
(BTN, May 20). British Airways has no transatlantic revenue-share links but will begin beyond-hub codeshare flights with Oneworld alliance co-founder American Airlines, once DOT grants final approval, which the airlines expect soon.
Separately, DOT last week granted antitrust immunity to Star partners United and Asiana of South Korea. The partnership, according to DOT, is not likely to reduce competition. The two airlines said deeper cooperation will foster competition against existing immunized partnerships between Northwest and Malaysian Airlines, and SkyTeam allies Delta and Korean Airlines.