The codeshare service started by All Nippon Airways and Air Canada in August on Osaka-Vancouver marks the growing emphasis the Japanese carrier is putting on expanding its network through alliances.

The days when Japan's Ministry of Transport discouraged its carriers from forming such pacts are clearly over, and the doubts that remain are how well Japanese passengers accept codesharing and whether Japan's crowded airports will accommodate the growth ANA hopes these partnerships will generate.

ANA's arrangement with Air Canada illustrates much about its alliance strategy. First, the service is from Osaka/Kansai rather than Tokyo/Narita, where ANA's slots are more restricted: the carrier is focusing its international expansion at Kansai because the slot availability also allows ANA to ensure good domestic feed. Second, the new Vancouver route, ANA's first to Canada, is operated entirely by Air Canada. ANA's initial commitment is only a blocked purchase of 10 to 20 per cent of the seats, depending on season, and one ANA flight attendant per trip. As the route grows this will change, but ANA's launch risks and outlay are minimal.

Third, ANA's pact with Air Canada is typical of the Japanese carrier in that it does not fit into its broader scheme of alliances. Air Canada is a partner of United Airlines, while ANA's US partner is Delta Air Lines. Air Canada's rival Canadian has a limited codeshare with British Airways on some routes, yet ANA's frequent flyer programme is linked to the UK carrier's. 'Alliances are still relatively new in our industry,' says Kazuhisa Shin, ANA's senior director for network management. 'We don't worry about the global picture. Our policy is to pick partners in individual markets.'

That seems to be ANA's pattern within Asia, where it reciprocates on frequent flyer programmes with Cathay Pacific, Singapore Airlines, and Malaysia Airlines, and is in various stages of alliance talks with Asiana, EVA Air, Garuda Indonesia, and Singapore Airlines.

But the lucrative Chinese market is ANA's biggest priority in Asia. 'We are also very interested in a codeshare with a Chinese carrier,' says Shin. The carrier has held discussions with Air China and Shin says he is prepared to propose pooling revenue on shared routes, much as Korean carriers now do in China, to alleviate Chinese concerns that given a choice all passengers would opt for ANA. 'We hope to open the Chinese government's mind to allow more flights,' says Shin.

Much as politics will play its part in gaining any further access to China, Shin predicts Washington will not approve its alliance with Delta until after the US presidential election. 'If they did now, someone would scream,' Shin predicts. Once that pact is approved, and after the current Japan-US row is settled, Shin predicts ANA will approach Japan's MOT for approval of third country codesharing between ANA and Delta on routes within Asia, giving the US carrier indirect fifth freedom access beyond Japan. The thought of more fifth freedom rights for US carriers is anathema to Tokyo, but Shin is confident that with ANA's support the MOT would grant Delta beyond codeshare approval.

David Knibb

Source: Airline Business