Alliances to remain central for airlines: Lufthansa chief

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Lufthansa chief executive Christoph Franz has defended Star Alliance’s business model, saying airline partnerships will continue to be as relevant in the future as they have been in the past.

Franz set out his position after a 13 December meeting of Star member airlines' chief executives in Vienna, where, he says, the directors had "open discussions" with "good conclusions" about the grouping’s role amid growing competition from low-cost operators in the short-haul arena and from Gulf carriers in the long-haul business.

Better customer service is one of three key reasons why airlines alliance continue to be significant, Franz says. The partnership model gives carriers a global scale in terms of route network and customer benefits – such as collection of frequent-flyer miles across different operators – which individual airlines would be unable to provide on their own.

Working together as a team also creates significant business volume for the individual partner airlines, he says. Per day, Star operators typically carry a total of around 43,000 transfer passengers – equivalent to about 300 narrowbody flights – who change from one partner airline to another.

When Austrian Airlines opened in 2012 its route from Vienna to Chicago O’Hare airport, a main hub of fellow Star carrier United Airlines, the US operator helped to establish the flights and integrate them into its own network.

Star’s member carriers want to expand this collaboration in future, with airlines feeding passengers to each other, says Franz.

Finally, runs Franz's argument, airline alliances also serve the aviation industry as a whole by providing a platform where carriers can work together in relative openness despite the competitive airline environment. This has led, for example, to development of shared safety and operational standards, says Franz.

The next step in Star’s "evolution" will be closer co-operation between individual airlines, says Austrian chief executive Jaan Albrecht. The Alpine carrier is part of parent Lufthansa’s transatlantic joint venture with United and Air Canada, "Atlantic Plus Plus", as well as the similar "Japan Plus" arrangement between the German group and All Nippon Airways.

After the airline alliance allowed member carriers to move "closer" together, the next step in the integration process will be "getting married" to individual operators through joint ventures, says Albrecht.

Star's next chief executive board meeting is planned for June.