Aviation alliances Skyteam and OneWorld looking at Indian carriers

12 June, 2007:

The Indian airline space is being seen as bullish by two global airline alliances, says a report. The alliances, SkyTeam and OneWorld, have in fact kicked off preliminary discussions with Indian carriers to attract them into their respective teams, the report added.

According to a SkyTeam official, the alliance has already held discussions with Air India, Jet Airways, and Kingfisher about joining the alliance. The alliance feels that the potential of having an Indian airline in the alliance has grown and an Indian airline would join the SkyTeam. The alliance has made it a priority to finalise discussions with Indian carriers and select a partner, the report added.

Meanwhile, industry observers feel that the Indian aviation industry is currently going through a phase of consolidation. The Jet-Sahara deal was followed by the Air India-Indian merger and then the Kingfisher-Air Deccan deal. They believe that the aviation scene in India would take at least three to four years to stabilise. This in turn would in effect dictate the alliance partnerships, it is learnt. The SkyTeam has ten airlines as members including Aeroflot, Air France, Alitalia, Continental Airlines, KLM and Northwest Airlines, while OneWorld has members like British Airways, American Airlines, Cathay Pacific, Japan Airlines, Qantas, and Royal Jordanian.

However, going by aviation industry reports, state-owned Air India has already declared its intention of joining the third group, Star Alliance. Analysts see India, China and Brazil as potential growth markets and the global airline alliances are expected to see more participation from these nations.

Adding to the prospects, another major alliance, OneWorld, has said that the huge local and regional market coming up in the Indian subcontinent would have to be considered when thinking of an extending the alliance. With India soon to become a major aviation hub in the next two to five years, the potential for an alliance is high.