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Jet Airways


Jet rides global airline alliances to expand international reach

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Apr 06, 2008

Mumbai - The country’s largest private carrier Jet Airways (India) Ltd is planning to enter into more alliances with international airlines, to expand its global network without actually adding more planes or directly flying to new destinations abroad.

The arrangement will see the Mumbai-based airline — which is trying to push up global sales so it can achieve 50% of its revenues from international operations by 2010 — enter into deals with carriers that can fly its passengers to and from destinations beyond its own international routes. For example, Jet Airways, which currently flies on 14 international routes, has already brokered such a deal with Qantas Airways to fly its passengers beyond Singapore to Sydney, and the other way round.

“The main advantage of these arrangements is to have enhanced connections across the world by being part of a global airline alliance. There is no additional investment for launching new routes and we will end up getting more than 5% traffic once the code-share agreement is settled,” said K.G. Vishwanath, senior general manager, management information system and investor relations, Jet Airways.
Naresh Goyal, chairman of Jet Airways, said: “We are talking with many international airlines such as Cathay Pacific and Alitalia for serving respective markets where they are strong. We even want to cooperate with Air India.”

India’s domestic airlines are eyeing lucrative international routes as the number of air passengers flying into and out of the country grows at around 20% a year. Some 30 million passengers flew to and from India in 2007, tempting domestic airlines to sew up code-sharing agreements with global carriers to help expand their reach.
Code-sharing refers to a ticket marketing practice among airlines that allows carriers to share the two characters in codes used in airline reservation systems.

On the ground, this helps customers purchase a single ticket on a journey that has two flights, such as a New Delhi-Amsterdam one and an Amsterdam-New York one, on two different airlines.

The partners share the revenues based on a pro-rata agreement. “Jet Airways has special pro-rata agreements with over 75 airlines, but we will have code-share with only select partners. Even if you enter a code-share agreement, you continue to have a special prorate agreement with the respective airline,” Wolfgang Prock-Schuaer, chief executive of Jet Airways, had said earlier. Jet Airways already has tie-ups with American Airlines for serving five domestic destinations from the John F. Kennedy Airport in New York and with Air Canada, United Airways and Brussels Airlines. It is also in talks for strategic and operational alliances with several international carriers, including Alitalia, Cathay Pacific, Thai Airways and Etihad Airways.

The airline might join one of the three major global code-share alliances — Star Alliance, One World or Sky Team, said Kapil Kaul, chief executive, Indian subcontinent and West Asia, Centre for Asia Pacific Aviation, an international aviation consulting firm.
Jet Airways is not part of any global alliance, though it is critical to have partnerships with other international carriers so the airline can offer seamless onwards travel and connections to its passengers, he said.

State-run Air India, run by National Aviation Co. of India Ltd, joined Star Alliance, the largest operating grouping of global carriers, for a similar arrangement.

Star Alliance counted Singapore Airlines, Lufthansa, United, US Airways, Air Canada and Air China among its members last year.
Kingfisher Airlines Ltd, too, has tied up with Air France, Emirates, Continental Airlines and Delta Air Lines for code-sharing agreements, and plans to start flying on international routes from August.

livemint.com

Jet rides global airline alliances to expand international reach
Lucrative routes: Jet Airways (India) Ltd chairman Naresh Goyal



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