Kingfisher Airlines to join oneworld alliance, will Jet Airways join Skyteam?

Ever since Kingfisher Airlines had a fare war with British Airways on the Bangalore London Heathrow sector over a year ago, there have been behind the scene parleys between the two airlines on cooperation rather than competion. Bangalore Aviation learnt of these negotiations in January, but were requested to hold on till the deal came through.

This report on oneworld co-founder American Airlines’ website confirms the deal.

India’s leading domestic carrier and only five-star airline, Kingfisher Airlines, is lining up to join oneworld® after signing a memorandum of understanding as its first step towards full membership of the world’s leading quality airline alliance, subject to Indian regulatory approval.

As per the report, the agreement was concluded at a meeting between Kingfisher Airlines’ Chairman Vijay Mallya and Chief Executives from oneworld’s 11 existing member airlines. Kingfisher has already applied to India’s Ministry of Civil Aviation for authority to proceed with its membership of oneworld and is expected to join the alliance during 2011, with British Airways being its mentor.

Kingfisher will provide the alliance a crucially needed network in South Asia and in return gain critically needed traffic from oneworld giants American, British Airways and Cathay Pacific. Based on its current international network, it will connect with the alliance in London (American and BA), Hong Kong (Cathay), and Singapore (Qantas). Another option for the carrier will be Tokyo and JAL.

With state owned Air India being mentored by Lufthansa to join the Star Alliance, pressure will now come on India’s largest domestic carrier Jet Airways to join the SkyTeam alliance.

Jet has always practised a policy of bi-lateral and code-share agreements and its management has steadfastly refuted any speculation of carrier joining an alliance, but may not be able resist any longer. Jet Airways has on-going code-share and bi-lateral agreements with oneworld members American Airlines and Qantas which are bound to be affected. A source a Jet Airways said joining an alliance was now “inevitable”.

Though Jet has entered a wide ranging agreement with United Airlines, the Star Alliance is not a viable option for Jet. The government of India is keen on Air India joining the Star alliance and will look very negatively at any alternate move by any other carrier joining the alliance. It is doubtful that either Jet Airways or Lufthansa will try and risk the ire of the government with a Jet Airways-Star Alliance agreement. Additionally, many industry watchers blame the opposition from Jet Airways for the failure of the Tata-SIA airline venture to obtain government clearance. It may have been over ten years ago, but Singapore Airlines has a very long memory and is a major player in the Star Alliance.

Skyteam will be a good fit for Jet Airways. It can cooperate with Delta via Europe and Korean via Incheon for the American market. Air France-KLM will give Jet pan-European connectivity. In return Jet offers a formidable pan-India network in both the full service and low cost segments. Additionally Jet has a good network from India to the middle east and south-east Asia which fills a crucial void current missing in the Skyteam network.

Will 2011 see all three alliances finally operating in India? That answer lies with the management of Jet Airways.

About Devesh Agarwal

A electronics and automotive product management, marketing and branding expert, he was awarded a silver medal at the Lockheed Martin innovation competition 2010. He is ranked 6th on Mashable's list of aviation pros on Twitter and in addition to Bangalore Aviation, he has contributed to leading publications like Aviation Week, Conde Nast Traveller India, The Economic Times, and The Mint (a Wall Street Journal content partner). He remains a frequent flier and shares the good, the bad, and the ugly about the Indian aviation industry without fear or favour.

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