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The oneworld alliance is probably the most dysfunctional of the three major alliances as a good number of its airlines simply do not get on with one another.
The squabbles between BA and Qantas are well documented, Cathay Pacific and Qantas have never really seen eye to eye and American Airlines has spent the best part of the past five years trying to get the American government to impose sanctions on Qatar Airways.
I’d love to be a fly on the wall when all the members sit around a conference table to discuss whatever it is they discuss….it must be like the most awkward Thanksgiving dinner of all time!
Anyway….
The three legacy US carriers are supposed to have agreed a peace accord with the Middle Eastern carriers (the ones that they’ve been harassing for years) but American Airlines (and in particular its CEO, Doug Parker) just won’t let things lie.
As we heard a few weeks ago, Qatar Airways appears to have has enough of Doug Parker’s rather large mouth (American Airlines customers and large proportion of American Airlines’ workforce probably feel the same way) and is threatening to leave the alliance.
The initial reports of the threat to leave were mostly shrugged off as grandstanding by the Qatar Airways CEO (another a man who likes the sound of his own voice) but recent comments made by Willie Walsh (the head of IAG) suggest that there may be more to the Qatar Airways threats than just bluster.
Now CH-aviation has reported that Akbar Al Baker (the Qatar Airways CEO) has made further comments regarding his airline’s continuing participation in oneworld during the IATA Wings of Change conference in Madrid:
There is no point in us staying in Oneworld if there are airlines seeing us as a threat rather than a partner. We own substantial shares in three major Oneworld members and we could work with them instead of staying in the alliance
Al Baker also told reporters that he had let the other oneworld airlines know the conditions for Qatar Airways’ continuing membership of the alliance and that he was now awaiting a response.
Interestingly, despite the fact that American Airlines has been the main thorn in Al Baker’s side it was Qantas that he singled out as a carrier working against his airline within oneworld.
Could Qatar Airways Work With Equity Partners?
In short: Yes, quite possibly.
Qatar Airways owns over 20% of IAG, 10% of LATAM and just under 10% of Cathay Pacific so, with IAG being the parent company of British Airways and Iberia, Qatar Airways actually holds significant equity interests in 4 of the other oneworld member airlines….and these are major airlines too.
The question that’s left is does Qatar Airways need to cooperate with any of the other major oneworld players?
Possibly not.
American Airlines has already withdrawn from the codeshare agreement it had with Qatar Airways (so there’s not much more for Qatar Airways to lose from that relationship) and Qantas is already being belligerent (apparently) so it doesn’t look like the airline has much to lose by cutting ties with the Australian carrier either…..and leaving oneworld doesn’t mean that Qatar Airways can’t do deal with other airlines to fill the gaps.
If Qatar Airways feels that it needs the likes of S7 (Russia), JAL (Japan) and Malaysia Airlines (SE Asia) as partners that feed traffic to its international routes there’s nothing to stop that from happening outside of oneworld. Qatar Airways doesn’t have to be in the alliance to form partnerships with other alliance members.
If the loss of Qantas as a partner looks like its going to hit Qatar Airways the carrier may be able look to the likes of Virgin Australia to help shore up the gaps.
Virgin Australia is already a partner of Etihad so a tie up with Qatar Airways may look unlikely…but it’s not that unlikely. Take a look at things from a Virgin Australia perspective: Who would you rather partner with, the basket case that is Etihad or Qatar Airways? It’s not even close!
Note: Virgin Australia’s relationship with Delta may be an obstacle to a partnership with Qatar Airways but I don’t think it’s an obstacle that couldn’t be overcome.
Bottom Line
It’s still far from certain that Qatar Airways will leave oneworld but if anyone is wondering if Qatar Airways can survive outside of the alliance then answer is a resounding yes.
Qatar Airways has made significant investments in some major airlines around the world and there’s no reason is couldn’t leverage those investment to form a quasi alliance of its own. In doing so it could wave farewell to oneworld and leave behind the squabbles it believes it can happily do without.
Hi, hope you accept my feedback – it’s very hard to read your blog with this light grey font that is also very light.
It’s always good to get constructive feedback so thank you for commenting.
In short, I agree! The font is definitely too light but for some reason the theme settings refuse to make it darker (although other blogs seem to do fine with this theme). I’m in the process of getting a new theme installed and that should make the whole site a lot easier to read and navigate.
I may have just found a workaround – is the font easier for you to read now?
I’m curious about your reasoning for the possibility of QR working with CX and VA if it were to leave OW.
QR had a failed JV with CX that ended in 2016. Why do you think CX/QR relationship will work if QR were to leave OW?
Just as QF chooses to work with EK, there is currently nothing that prevents QR from working with VA other than the fact it is partly owned by EY. Why do you think it is even possible for QR to work with VA if it were to leave OW?
Very fair questions.
Firstly I should say that this is all purely speculation but it’s based on an attempt a logic 🙂
QR’s investments in other airlines appear to have been as much about politics as they have been about new sources of revenue and I think that the situation with Cathay is a very good example of this.
Cathay isn’t exactly in the best of financial health so it looks like the investment QR has made in Cathay was one with a view of gaining leverage over the Cathay board (just how much leverage is debatable) more than one with a view to making money. As such I think that a future relationship between the two airlines would have a larger chance of success than in the past.
As far as VA goes, I happily admit that this is a wildcard that I’ve thrown in but it’s not as crazy as it may sound.
If memory serves me Qantas entered into its relationship with Emirates before QR joined oneworld so it wasn’t like Qantas was snubbing an alliance partner like it did with BA.
When QR joined oneworld there was no real reason for it to go looking for an Australian partner because it had a ready-made one in the alliance it had just joined…hence no interest in VA.
Now the landscape is very different and with QR and Qantas at loggerheads it would seem to make sense for QR to look for other options (if it thinks it needs them) and VA is the next best option….albeit a tricky one with Etihad’s involvement and the relationship with Delta (who isn’t exactly a QR fanboy).
Like I said in the beginning, this is all just speculation but hopefully I have at least set out my thinking a bit more clearly
[…] big oneworld news right now is that Qatar Airways isn’t at all happy with American Airlines (who is?) or Qantas but a seemingly unrelated piece of news, which broke yesterday, may be the one which ends up having […]
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