• Types of alliance

In order to meet definite requirements of airline, an extensive range of difficult agreements of inter-airline has developed. In the industry of airline, the code-sharing agreements are the most common form of alliance. Theoretically, alliance’s diversity can be associated towards the cohesion level among the partners of code-sharing. This level is reproduced in.

  • The alliance’s non-operating carrier’s commercial commitment
  • The airline product’s operational integration
  • The integration degree of marketing mix’s other components
  • Alliance’s equity aspects
  • The network scope 

       In general, four kinds of alliances are present like point specific. First type is Point specific where on specific city pairs the airlines only block space or code-share. Regional alliance is the second type where the airlines code-share on franchise regional airlines or on a number of routes. Global alliance is third type where several routes are code-shared by airlines connecting two significant networks of hub in an extensive commercial agreement. Strategic alliance is fourth type where the co-mingled assets might be maintenance bases, staff, traffic rights, aircraft, capital resources or terminal facilities. 

Items Content
Point Specific
  • Code-shares on less number of pairs of city
  • Often with the purchase of block space
Regional
  • Code-share on huge number of routes from-to a franchising of regional airline or a specific region 
Global
  • Extensive commercial agreement
  • Several routes shared by code
  • Connecting two significant networks of hub
Strategic
  • If there is only an effective co-mingling of assets

 Table: Nature of airline alliances

 

  • Factors affecting alliances 

     From the perspective of economy, limitations towards alliances can result from huge number of resources; constraints of regulatory compelled by technology changes, factors of supply-side like network economies, scale and scope, trends in demand level, determinants of market organization like competitive nature, and overseeing agencies.