U.S. Airlines Could Begin "Partnering" With Each Other

"Welcome onboard this Delta Air Lines flight to St. Louis, codeshare with Star Alliance member United and Oneworld member American Airlines. We know you had a choice when flying, but this time, you don’t."

- FATIII Aviation



With the multi-billion dollar bailout planned for U.S. airlines, they have been asked to maintain service to their existing cities and avoid furloughing employees through September.

Unfortunately, as demand continues to decline, this means more of their flights will have abysmal and near-empty load factors.

However, to solve this, CNBC says airline executives have found a solution: Consolidate Flights.

How would consolidation work?

Take the route from New York City to St. Louis, Missouri. Right now, American, Delta and Southwest all fly the route from LaGuardia Airport to St. Louis Lambert International Airport. If the route were temporarily consolidated, all airlines would continue selling tickets on the route, but the carriers would agree to put all the passengers on one plane.

In other words, we’re looking at a nationwide codeshare with every single U.S. airline that competes on a certain route.

One airline executive said:

Does it make sense for more than one of us to be flying to a city when there are only a few seats filled on each plane? It may make more sense to maintain service to that city, but put all passengers on one plane.”

According to CNBC, the idea hasn’t been discussed with the Department of Transportation, so it may be a bit until we see the launch of something like this.

Images/Sources

CNBC: https://www.cnbc.com/2020/03/29/consolidating-flights-to-us-cities-could-help-stem-airline-losses.html
ViewFromTheWing: https://viewfromthewing.com/airlines-expected-to-ask-permission-to-reduce-service-through-broad-domestic-codesharing/
Image: https://liveandletsfly.com/2020/03/10/coronavirus-waiver-extended/

This is a pretty cool idea and definitely would be a first to see multiple U.S. airlines “partner” with each other through limited codesharing. This would definitely help the plummeting load factors and allow airlines to maintain the conditions of the government bailout package.

What are your thoughts on this?

32 Likes

They kinda need to as the situation guess worst they need to hold each others back even though they are enemies in the skies. 👀

3 Likes

With how bad the industry has been impacted, they need something like this. It has my support.

2 Likes

Here’s what I say.

Nope. Not happening.

There’s way too many flaws with this kind of plan. Allow me to list them.

  1. A monopoly on US air travel would be created. I do not care if it’s government granted or not, these are private, non-government-funded businesses. This consolidated company would become too strong for the free market. Small airlines would be pummeled by the big corporate giant.

  2. Internal disagreements would be formed. When this pandemic is over, the airlines would have to split again to protect the free market and prevent a monopoly. But when will the pandemic be over? It’s way too ambiguous. There’s no way that all of these airlines will come to a consensus on when the pandemic is over, which would be the time to split up.

  3. This would be a big logistical mess. For instance, flight attendants are trained for their airline, and what if you have Delta flight attendants on a Frontier aircraft? They’ll have no idea what they’re doing because of different guidelines. The same could go for pilots. A Spirit crew on a United aircraft? There might be differences in how the pilots are trained for each airline. Mixing crews would be weird because of a difference in training. Flight attendants would have to be grouped with pilots who would have to be grouped with certain aircraft. They’re trained differently.

  4. What are you going to do with the leftover aircraft? They can’t all just sit scattered at airports around the country. Parking at an airport for that long is VERY expensive. There would have to be a bunch of ferry flights to, let’s say, Victorville for storage. Victorville would be filled to capacity very quickly in this situation. That’s also a lot of pilots to fly back to wherever they’re needed. Would keeping planes grounded cost more or less than flying them near-empty?

The coordination of this would be very tedious, challenging, and slow. Perhaps by the time this is all figured out there wouldn’t be a need to consolidate. The logistical mess, cost efficiency, and monopoly created, is not worth it in my honest opinion.

3 Likes

Pretty sure they’d need to go through training in order to crew other airlines’ aircraft, so I’d assume flight attendants will only work in their own airline/aircraft.

Park them on runways unfortunately. With less flights each day, some airports are closing runways and storing aircraft on them.

Here’s Atlanta for example:

Image creds to @DougTurnbull

True, but I’d think airports are waiving the fees?

Grounded would cost less. Say an airline grounds their entire fleet and lays off all employees. Basically zero spendings?

If an airline were to continue operating flights with 10-15% load factors, the cost of operating the flight would significantly outweigh the revenue.

6 Likes

That would be insane if it happens. Should be interesting for sure… not sure anything like that has ever happened before. Wonder how it’ll pan out!

1 Like

There will not be one. The airlines are not merging. They are merely selling seats. Airlines are still free to set their own prices and they will all be allowed to sell a set number of seats on each flight. I can talk about transfer pricing ad nauseum, but it should be relatively simple.

No, there is no need to split afterwards under the current arrangement as proposed. No one is merging anything.

It’s really not as difficult as you make it sound. Take a LGA-BOS flight. Let’s say that the partnering Airlines (AA, DL, UA, B6 for the sake of this example) noted that there is demand for 20 flights weekly at a 50% LF to maintain social distancing. Each airline can operate 5 out of the 20 flights and each airline can sell 1/4 of the available seats on each flight to their customers. All 4 airlines are free to set their own pricing and bear the responsibility of operating 1/4 of the flights.

Of course, there will be differences in seating capacity and cabin configurations. But that can be easily fixed by utilizing a formula to allocate saleable seats to each airline by their proportion of saleable seats contributed to the partnership. It’s really not that complicated for all of the airlines that would be interested in these partnerships.

Less.

Handshake agreements are a thing. It will sure beat the airline bleeding money. I’m sure they are eager to listen to any proposal that will help them slow the bleeding.

There doesn’t have to be one.

There is a lot of that.

There won’t be one.

9 Likes

Now that you explain it like this I get it. It’s just a codeshare. The way I interpreted this whole article was as a full but temporary integration rather than a partnership. Sure, there’s some things that must be consolidated (like the cabin configuration as you mentioned) but it’s not full-on.

I’d make for a terrible businessman…

2 Likes

I’d say you might want to loo this over again. As for the monopoly thing, no, they’ll all set there own prices still, they’ll just be using each other’s aircraft. Disagreements and stuff probably will form, and for that reason I be willing to bet that as soon as this blows over they all forget this ever happened and compete with there own aircraft again. There would be no problems with crew, it would be like any other codeshare, southwest aircraft southwest crew, there might just be some passengers who booked though delta. And there’s already “left over” aircraft. I was out today and say the planes currently parked at pittsburgh and it’s staggering, there’s 84 of them just here. I really don’t think many of your points would be major concerns, and I don’t think the airlines will really like this, but they want to do what they have to do to stop bleeding cash, and this seems like a good option…

EDIT: see that you got it now, sorry for being late to the party 😉

4 Likes

Dang, what did American send over there? E-190s and A330s?

Apparently American’s rumored to be retiring the entire E-190 and A330-300 fleet… or at least accelerating E-190 retirement.

1 Like

I’m glad that some executives are able to see past the greed of corporate America and work together. This is really a sign of America coming together through these uncertain times.

1 Like

image
Airline Edition.

On a side note, this has happened before.

Major internet companies actually met together and many of them merged in one summer. They then created zones for the merged companies for a virtual monopoly on internet access. That way, no competitive pricing or better service as they were the only provider you got.

https://www.ft.com/content/5645e304-97f5-11e3-8c0e-00144feab7de

Don’t get me wrong, this is a pretty good idea considering the times we are going through. But then it could jack the prices way up in the long run.

Well I’d sure hope the pilots aren’t trained differently based on airline! Last I checked, crews are certified based on aircraft type by FAA and not by the airlines…

Well said.

1 Like

This sounds intriguing and interesting, I doubt it would happen though.

1 Like

Wouldn’t a monopoly be formed?

This would be beneficial for airlines as a short term solution, however with the pandemic people need social distancing and what not… if you pack everyone into a plane them the chance of someone who has the disease to spread it to another passenger increases prolonging the time in which airlines can see normal service if we are doing these codeshares nation wide and more people are getting sick. Then airlines will operate with minimal profits for longer… also what would be the agreement on fuel, aircraft and crew used for each flight. As well as Ground OPS, dispatchers and what not when you have multiple industry giants code sharing.

1 Like

Yes a monopoly would be formed no other airlines would be able to operate these routes. If Delta, United, and American, or even southwest all codeshare then what is JetBlue, Frontier, Alligent, Sun Country, Alaska Airlines, or Spirit going to do. Even the f they form an alliance they will not be as strong as a legacy airline and they don’t have he capability to operate a bigger plethora of planes.

If JetBlue American Delta and United team up
They would be unstoppable.

1 Like

This is one of those situations where it will be beneficial in he short term but not long…

1 Like