Teaming up

● Airline alliances take several forms including: Interline agreements

A commercial agreement between airlines to handle passengers when they’re travelling on different airlines on the same itinerary. This allows passengers to check their bags through to their final destination, and check in all the way to their destination. These require airlines to have compatible technology.

Codeshare

Where one airline puts its number and name — or code — on a flight operated by another airline, and sells tickets on that flight. This allows airlines to offer service to cities they don’t actually fly to.

Joint ventures and revenue sharing

These are complex arrangement where airlines co-ordinate pricing and schedules, and share revenue (not profits). These are big calls by airlines and government regulators. Air NZ and Singapore Airlines is an example of a joint venture.

The global airline groups

Oneworld, Star Alliance and Sky Team are examples. Depending on relationships between airlines within them, this can mean codesharing and reciprocal benefits such as lounge access.

● Ups

● Alliances and joint ventures mean airlines have a better chance of being successful, and that’s good in the long run for passengers.

● Frequent flyer points can be shared, depending on the depth of the alliance.

● More seats on routes between cooperating airlines.

● Connection to networks far beyond an individual airline’s routes.

● Convenience at check-in, carriage of bags.

● Reciprocal lounge access.

● Increased competition if airlines in alliances compete on the same route. An example will be more competition flying non-stop across the Pacific between Air NZ/United and Qantas and American Airlines, whose joint venture has been renewed. It is understood American Airlines will announce more flights from Auckland later this month.

● Downs

● They can stifle competition. When Virgin Australia and Air New Zealand split up after seven years, the two airlines put on more transtasman flights, and Virgin offered a better product.

● Poor communication of which airline’s planes you will be flying on.