SkyTeam Sheds Light On India, South America Moves

SkyTeam Alliance is aiming to get member carriers in Latin America and India as a top priority. It has arranged an event for Nov. 29 in which it will sign an agreement with Aerolineas Argentinas, so the Argentinean flag carrier can work towards becoming a full member of SkyTeam in 2012, says SkyTeam Chairman Leo van Wijk. He was speaking to Aviation Week on the sidelines of an event, in Jakarta on Nov. 23, to promote Garuda Indonesia’s effort to become a SkyTeam member in 2012. Wijk says SkyTeam wants to secure more member carriers in Latin America. “The key market in Latin America is Brazil. It’s the biggest market, with the biggest growth potential.” When asked about potential candidates in Brazil, Wijk points out that Varig is no longer part of Star Alliance because low-cost carrier Gol Airlines took it over. A key issue will be whether the Varig/Gol Airlines group wants to stay in the low-cost carrier segment or whether it wants to “to participate in the global game” and be a network carrier, says Wijk. As for India, Wijk says a lot depends on whether Air India finally ends up joining Star Alliance. Air India’s membership of Star Alliance has been delayed several times, partly because the state-owned Indian carrier has been pre-occupied with completing a merger with its state-owned sibling Indian Airlines. Air India has also encountered problems getting its information technology systems ready to be compatible with Star Alliance’s other member carriers. Wijk says if Air India fails to join Star Alliance, there is a strong chance that privately-owned Indian carrier Jet Airways will try to join Star Alliance. But if Air India does end up joining Star Alliance, that helps pave the way for Jet to possibly become a member of SkyTeam, he says. When asked about how airline alliances may evolve in future, Wijk refers to SkyTeam’s north Atlantic arrangement as a future model for other parts of the world. This arrangement is a joint venture in which SkyTeam’s Air France KLM Group, Alitalia and Delta Air Lines jointly operate trans-Atlantic routes and share the revenues and the costs. He says for this model to work, the airlines need to be integrated. Wijk also says one of the impediments stopping this model from developing in other parts of the world, such as Asia, is because competition regulators may refuse to grant the necessary approvals.