n.b. – This story first appeared in the APEX Editor’s Blog on 5 November 2013
For the first time in history a Gulf carrier has become part of a global airline alliance. Qatar Airways formally joined the oneworld alliance in a ceremony at Doha’s Hamad International Airport, adding the carrier’s 133 destinations to the alliance route map – 21 not currently served by other members – and, more importantly, growing the oneworld footprint in the rapidly expanding Middle East business market.
The oneworld group has historically been cautious – some might even say slow – about adding members. The addition of Qatar Airways is one of several changes to the alliance recently which suggests they are looking to change that reputation. Malaysian Airlines recently joined and Sri Lankan is on tap for early 2014. Plus, US Airways is slated to join, assuming their merger with American Airlines goes through. All told, the alliance will be expanding its flights by nearly 50% over a two-year period. That’s a massive change for oneworld and has significant potential for passengers around the globe. Equally significant to the magnitude of the changes is their direction; no longer is the focus solely on the major markets.
Oneworld’s strength has previously been in connecting major business markets with high frequency. The new members are allowing the group to fill out their route network better, offering up more connections into smaller markets and within developing regions rather than focusing on the city pairs dominated by legacy carriers. While Qatar Airways serves many of the major business markets already their major lift is not in passing passengers between those hubs but in taking them from those cities to smaller – but rapidly growing – destinations. Qatar Airways has approximately 70% of its operations working in markets within the Middle East, South Asia and Africa that are currently underserved by other oneworld members. Their integration into the group will represent an increase in options for travellers rather than simply being another airline flying covering the same airports as the existing members. This is very much an augmentation, not a replication of other offerings within the group.
Qatar Airways CEO Akbar Al Bakar, in prepared remarks, noted that the carrier has been looking at joining an alliance for some time, but that it took the correct set of circumstances to make the move. “We are convinced that the time is clearly right to join an alliance and that oneworld is the best to join.” He later expanded on that idea, noting that Qatar Airways is a “high-class airline and we wanted to join a high-class alliance”. And, despite comments from other carriers about the Gulf airlines not necessarily belonging in the global alliances, the outlook at oneworld is very optimistic. Willie Walsh, CEO of British Airways’ parent IAG was quite firm in his support of Qatar Airways joining the group, noting that he is “without question optimistic about the relationship Qatar Airways can have within oneworld”.
Oneworld’s recent growth spurt presents a potential risk of dilution and loss of focus for the group. This concern combines with the uncertainty over recent months as partnerships outside the alliance groups have overshadowed those within. By targeting regions currently underserved by alliances, namely South Asia and the Middle East, oneworld should be able to remain focused and continue to grow in the high-value business markets. Don’t be too surprised when SkyTeam and Star Alliance look to replicate oneworld’s growth in these regions in the near future.
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