Analysts See Alliances As Key To Success
Two U.S. analysts painted a bleak picture for the five major U.S. carriers still in business in the absence of international alliances that will allow them to grow their global networks.
These carriers are trying to expand their networks but attracting service outside an alliance “has become harder” and premium traffic “has dried up,” Robert Hazel, a partner with Oliver Wyman, told an aviation session this week.
Patrick V. Murphy, a partner whose firm completed a study on international alliances that was funded by United Airlines, told the session sponsored by the Airports Council International-North America that alliances “are the network carriers’ future.” The former U.S. Department of Transportation official is now a partner at Gerchick-Murphy Associates.
Their remarks came as a senior DOT aviation official refused to say when the U.S. government plans to rule on American Airlines’ request to form an alliance with British Airways and Spain's Iberia.
American, which is pinning its hopes on intra-alliance competition and global partnerships to help it survive, had expected a decision by Oct. 31.
U.S. officials are “very aware” of that deadline and “unfortunately we missed it,” said Christa Fornarotto, DOT deputy assistant secretary for aviation and international affairs. But government officials are working “as quickly as possible” on the request. She added, “It’s a process and we want to make sure we get it right. There are a lot of negative consequences if we get it wrong.”
American, British Airways and Iberia want U.S. government antitrust immunity to form a transatlantic alliance. The carriers have been under growing pressure following U.S. approval of a similar request this summer by Continental Airlines to join United Airlines in the Star Alliance.

