Global Airline Alliances Essay

GLOBAL AIRLINE ALLIANCES (GALs)

ANALYSIS

AND AIRLINES NETWORK DEVOLOPMENT

ABSTRACT

Since the mid of 1990s, worldwide airlines have been enrolling in one of the three current and largest global airline alliances (GALs),

STAR ALLIANCE is the very first airline alliance founded in 1997, then it was followed by ONEWORLD alliance in 1999, and SKYTEAM in the year 2000, during the expansion of these GALs, airlines from different contents started belonging in to join,

GALs provided transportation for over two-thirds of all international traffic. This research studies the reasons that cause airlines to join collaborative scheme as a way for network development and to increase profitability by connecting the international traffic.

The evolution of

An essential element in the world of airline business is that most of the largest airlines are enrolled under one of the three major international strategic alliances, Star alliance, oneworld, skyteam , often called as global airline alliances GALs.

These networks of airlines provide their members with a resourceful international route portfolio at a marginal cost that would be very difficult to the reach through independent growth. yet still the provision of cross-border air service is constrained by international regulation.

Since the Chicago Convention back in 1944 established the rules of airspace, international air transport markets have been governed by bilateral air service agreements (ASAs) between national governments.

This implies that the country of registration of an airline and the bilateral agreements of that country with other countries has determined the airline’s possible routes of service and the conditions of capacity and frequency offered. Collaborative schemes between airlines, like the global airline alliances, are hence constructions of airlines to overcome these and other barriers encountered by airlines in their network expansion