 "Space exists to induct a second Indian airline and tap the growing aviation market: Mark Schwab")
Air India today became the first Indian airline to join Star Alliance, the world’s largest airline grouping operating around 18,500 flights to 1316 destinations across 192 countries. To mark the occasion, an Air India A320 in Star Alliance livery was unveiled at the Indira Gandhi International airport in the national capital today in presence of Air India CMD Rohit Nandan and CEOs of Austrian, Egyptian, Turkish and Singapore Airlines. Even as the integration of Air India into the global grouping opens access for Star Alliance members to 40 destinations within the country and paves the way for Air India passengers to fly across the world, Star Alliance CEO Mark Schwab tells Sharmistha Mukherjee, there is still space to induct a second Indian airline and tap in the rapidly growing aviation market in the country. Edited excerpts :
After nearly seven years of negotiations Air India finally joins Star Alliance….
Yes, it is s a very exciting stage for both Air India and Star Alliance. Star Alliance family is once again adding a new member. We are the first global alliance to have a member airline in India. From today, we will have strong presence in a country which has the fifth largest domestic aviation market in the world. Star Alliance members will have access to 40 destinations within India. Given the enormous population and the rapidly growing economy here, the air traffic market will see double-digit growth in foreseeable future. It is a great opportunity. We, at Star Alliance, will connect India to the rest of the world and through Air India open a pathway for those travelling to India through this induction.
The truth is a great deal of integration work with the Star Alliance network had already been accomplished. What we had to do in the last six months was to refresh these processes. We have observed a sea-change in Air India, particularly since the time Rohit Nandan (chairman and managing director, Air India) has taken charge. The airline’s fleet renewal programme is in progress, induction of 787s is on, infrastructure has improved, new terminals have come up in Mumbai and Delhi. The facilities on offer for travellers, the transfer process for Star Alliance passengers through New Delhi is as seamless as possible. All these factors were crucial in the final decision made by the board in London on June 23. They aided the quick entry of Air India had a quick into Star Alliance.
With the integration of Air India now complete, are you open to inducting a second airline from India into Star Alliance grouping?
There is certainly space for inducting one more airline from India as the market is big here. It is not unusual. We have had three members in the United States, two in China, many in Europe. We have had discussions (with airlines in India) but it is too early to say who or when. As of now, we are focusing all our attention on Air India. We have work here.
Is Star Alliance open to inducting a low cost-carrier from India?
What Star Alliance offers is global access to high value international passengers. We have 1000 lounges for our passengers across the world. Generally, the model of Star Alliance is to integrate with carriers which offer the same level of services as provided across our network. We have stringent requirements for memberships. We evaluate the strength of an applicant’s network, it’s frequent flier database while considering requests for inductions. Over 100 million frequent fliers are loyal to Star Alliance.
I will put it this way. In certain geographies, there are low-cost carriers which have evolved a hybrid model and provide premium services to passengers. As long as services offered by an airline is consistent with those commanded by passengers on our network on a global basis, we are open to consider requests for induction.
How soon can we see a second airline from India joining Star Alliance?
Right now, the area we are most focused on is looking for a suitable solution in Brazil. The aviation industry is consolidating globally. As part of this natural progression, a member airline TAM left and joined oneworld. Brazil is an important market for us. We are in talks with two airlines in the country and a final decision would be made over the next few months, Russia is another white spot.
After nearly seven years of negotiations Air India finally joins Star Alliance….
Yes, it is s a very exciting stage for both Air India and Star Alliance. Star Alliance family is once again adding a new member. We are the first global alliance to have a member airline in India. From today, we will have strong presence in a country which has the fifth largest domestic aviation market in the world. Star Alliance members will have access to 40 destinations within India. Given the enormous population and the rapidly growing economy here, the air traffic market will see double-digit growth in foreseeable future. It is a great opportunity. We, at Star Alliance, will connect India to the rest of the world and through Air India open a pathway for those travelling to India through this induction.
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It was in December 2007 that Air India first approached Star Alliance for membership. Talks fell through in 2011. The approval and the integration of Air India in Star Alliance this time around has taken six months. What facilitated such a quick entry?
The truth is a great deal of integration work with the Star Alliance network had already been accomplished. What we had to do in the last six months was to refresh these processes. We have observed a sea-change in Air India, particularly since the time Rohit Nandan (chairman and managing director, Air India) has taken charge. The airline’s fleet renewal programme is in progress, induction of 787s is on, infrastructure has improved, new terminals have come up in Mumbai and Delhi. The facilities on offer for travellers, the transfer process for Star Alliance passengers through New Delhi is as seamless as possible. All these factors were crucial in the final decision made by the board in London on June 23. They aided the quick entry of Air India had a quick into Star Alliance.
With the integration of Air India now complete, are you open to inducting a second airline from India into Star Alliance grouping?
There is certainly space for inducting one more airline from India as the market is big here. It is not unusual. We have had three members in the United States, two in China, many in Europe. We have had discussions (with airlines in India) but it is too early to say who or when. As of now, we are focusing all our attention on Air India. We have work here.
Is Star Alliance open to inducting a low cost-carrier from India?
What Star Alliance offers is global access to high value international passengers. We have 1000 lounges for our passengers across the world. Generally, the model of Star Alliance is to integrate with carriers which offer the same level of services as provided across our network. We have stringent requirements for memberships. We evaluate the strength of an applicant’s network, it’s frequent flier database while considering requests for inductions. Over 100 million frequent fliers are loyal to Star Alliance.
I will put it this way. In certain geographies, there are low-cost carriers which have evolved a hybrid model and provide premium services to passengers. As long as services offered by an airline is consistent with those commanded by passengers on our network on a global basis, we are open to consider requests for induction.
How soon can we see a second airline from India joining Star Alliance?
Right now, the area we are most focused on is looking for a suitable solution in Brazil. The aviation industry is consolidating globally. As part of this natural progression, a member airline TAM left and joined oneworld. Brazil is an important market for us. We are in talks with two airlines in the country and a final decision would be made over the next few months, Russia is another white spot.