x Abu Dhabi, UAEWednesday 26 July 2017

Qatar tipped for carrier alliance

One or more of the three major Gulf carriers will join an airline alliance this year, according to the boss of two of Europe's largest airlines.

Willie Walsh, the chief executive of International Airlines Group which owns British Airways and Iberia, expects Qatar Airways to sign up to an airline alliance this year. Karim Jaafar / AFP
Willie Walsh, the chief executive of International Airlines Group which owns British Airways and Iberia, expects Qatar Airways to sign up to an airline alliance this year. Karim Jaafar / AFP

One or more of the three major Gulf carriers will join an airline alliance this year, according to the boss of two of Europe's largest airlines.

"I personally believe the industry has matured to a point where we'll see Middle East carriers joining the alliances this year. I'd be amazed if this doesn't happen," said Willie Walsh, the chief executive of International Airlines Group, which owns British Airways and Iberia, both part of the oneworld alliance.

"Within oneworld we have been debating it. To my mind they [the Gulf carriers] are the key players", said Mr Walsh, who tipped Qatar Airways to be the most likely to sign up.

"We'll keep all options open, but I admire what Qatar has achieved. The combination of what chief executive Akbar Al Baker has done with the airline and what Qatar has done with the new airport at Doha makes it very interesting."

Addressing the Aircraft Finance and Commercial Aviation conference Wednesday evening in Barcelona, Mr Walsh described the three Gulf carriers, Emirates Airline, Etihad Airways and Qatar Airways, as "key players".

He said he admired the way they had managed to redraw the aviation map efficiently around the Middle East and gone on to defend their record from charges of unfair competition levelled by rivals such as Air France.

"I am actually somewhat different from my counterparts around Europe. I have no problem with what Middle East carriers are doing. Rather than be critical, I think we should look to them as an example of what can be done," he added.

The concept of airline alliances was born in the 1990s to help carriers take advantage of each other's marketing and route networks in the face of tight government controls and rising costs.

Most international airlines now belong to one of the three global marketing alliances, oneworld, SkyTeam and Star Alliance - in deals that allow them to sell seats on each other's flights and to link frequent-flyer programmes. British Airways' oneworld alliance includes Iberia, Qantas, American Airlines, Cathay Pacific and Air Berlin, which is 30 per cent owned by Etihad.

Emirates, the largest Arab carrier, has ruled out joining an alliance as it focuses on keeping a uniform brand across its own huge network, while Qatar Airways' official stance is that joining an alliance is not a priority, while leaving the option open for the future.

An Etihad spokesman said: "We never comment on speculation of this nature, except to say that we talk regularly and frequently to many airlines and a range of other businesses from all over the world about issues and opportunities."

Aviation analysts agreed with Mr Walsh's predictions.

"Willie Walsh doesn't hunt with the pack. He sees what the Gulf carriers have achieved, and he's happy to learn from it," said John Strickland, an aviation analyst for JLS Consulting. "As for who will sign up [to an alliance], Qatar's Akbar Al Baker has frequently expressed his personal admiration for Willie Walsh."

In his address to the conference, Mr Walsh also warned of further airline bankruptcies in the coming year and predicted further retrenchment among the survivors as weaker airlines struggle to generate the cash needed to ride out high oil prices.

"I expect to see significant moves on the subject of consolidation as we move through the year and into next year," Mr Walsh said.

About half a dozen European airlines have folded in the past year, including Barcelona-based Spanair, which stopped flying in January despite a cash injection from the Catalan government.

dblack@thenational.ae

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