Continental joins Star Alliance
Wednesday October 28, 2009
Continental Airlines yesterday became the 25th member of Star Alliance in Newark ceremonies attended by leaders of current and future member airlines, at which CO also unveiled a winglet-equipped 757-200ER in alliance livery.
Ahead of the formal induction, the carrier entered into bilateral commercial agreements with the other 24 members and signed codesharing deals with four--United Airlines, Lufthansa, Air Canada and bmi--the first three of which are part of the Atlantic Plus Plus antitrust immunized partnership.
"Bringing Continental into Star Alliance has been a truly unique experience," Star CEO Jaan Albrecht told media as he described CO as "one of the finest airlines in the world" and a "perfect fit" for the alliance. Both he and CO President and COO Jeff Smisek observed that this is the first time a major airline has moved directly from one alliance (SkyTeam) to another. It officially left SkyTeam on Oct. 24, having joined on Sept. 13, 2004.
Speaking to reporters, Smisek, who succeeds Larry Kellner as chairman and CEO on Jan. 1 after Kellner leaves the company to start his own firm, said the transition to Star took a lot more work than CO had expected. Discussing the decision to depart SkyTeam, he said the die was cast when Delta Air Lines and Northwest Airlines merged. The alliance "worked well for us when there were three major [US] airlines [but] once Delta and Northwest merged, we were relegated in effect to junior partner status." Switching from SkyTeam to Star, even without Atlantic Plus Plus, is worth $100 million per year to Continental, he said. Monetary costs to leave SkyTeam were "negligible."
Kellner said that following the end of merger talks between United Airlines and CO in 2008, UA Chairman and CEO Glenn Tilton "called the next day to invite Continental to join Star Alliance." United sponsored CO's admission and yesterday Tilton said UA "could not be more proud to welcome Continental." He added that the carriers in Atlantic Plus Plus are considering "potentially expanding that to include up to six immunized Star partners."
Addition of Continental dramatically increases Star's presence in the New York metropolitan market. According to alliance figures, 17 members operate 696 daily departures and offer 69,000 departing seats at Newark, LaGuardia and JFK airports. Star has a 51% seat share among the airports compared to 28% for SkyTeam and 21% for oneworld.
Continental also brings an extensive network into Latin America and particularly Mexico. And it may bring another carrier: Copa Airlines, whose CEO, Pedro Heilbron, attended but did not participate in the ceremonies (see item below). Star has flights to 30 airports where other alliance members have hubs or flight concentrations.
by Perry Flint
ATWOnline
Copa Airlines expects to make a decision whether to follow Continental Airlines into Star Alliance fairly soon, CEO Pedro Heilbron told ATWOnline on the sidelines of yesterday's Star Alliance-Continental Airlines joining event at Newark. Copa has a very close partnership with CO, a former investor in the Panamanian airline, so much so that it also left SkyTeam on Oct. 24. Heilbron said Copa has two choices: "To remain independent or join Star." Oneworld is not an option owing to the need to remain in partnership with Continental.
by Perry Flint
ATWOnline
