Blog 77: Analyzing SkyTeam!
Welcome back to Brooke In The Air! This week we’re breaking down the SkyTeam airline alliance. We’ve given the same treatment to the Star Alliance, the largest of the three alliances, it’s only fair to give the same treatment to SkyTeam! Next week, we’ll cover the One World alliance!
SkyTeam official logo
OVERVIEW
SkyTeam global headquarters at Schipol Airport
SkyTeam is one of the world's three major airline alliances. Founded in June 2000, SkyTeam was the last of the three alliances to be formed, the first two being Star Alliance and Oneworld, respectively. Its annual passenger count is 630 million, it is the second largest of the three major alliances. As of January 2024, SkyTeam consists of 19 carriers from five continents and operates with the slogan "Caring more about you". It also operates a cargo alliance named SkyTeam Cargo, which partners ten carriers, all of them SkyTeam members. Its centralised management team, SkyTeam Central, is based at the World Trade Center Schiphol Airport on the grounds of Amsterdam Airport Schiphol in Haarlemmermeer, Netherlands.
As of November 2024, SkyTeam flies to more than 1,150 destinations in more than 175 countries and operates more than 14,500 daily flights. The alliance and its members have 750 lounges worldwide.
On 22nd of June of 2000, representatives of Delta Air Lines, Aeroméxico, Air France, and Korean Air held a meeting in New York to form a third airline alliance. These became the four founding carriers of SkyTeam. Upon its formation, SkyTeam would offer its customers a total of 6,402 daily flights to 451 destinations in 98 countries. In September 2000, the alliance established a cargo alliance, SkyTeam Cargo. The group's inaugural members were Aeromexpress, Air France Cargo, Delta Air Logistics and Korean Air Cargo. The following month, the newly established airline alliance announced its intentions to incorporate CSA Czech Airlines as the 5th member in April the following year.
INITIAL EXPANSION
On the 24th May of 2004, Russian flag carrier Aeroflot signed a memorandum of understanding with SkyTeam as it intended to become a full member. The event took place in Kremlin following the airline's application earlier in the year for membership. SkyTeam expressed that Aeroflot has not met the consortium's standards, but that the airline's large hub networks made it ideal for the alliance, and made up for its deficiencies.
In 2022, after the Russian Federation invaded Ukraine, SkyTeam suspended Aeroflot's membership in the alliance amid ongoing sanctions.
On the 28th of August, in 2004, China Southern Airlines, the largest carrier in the People's Republic of China, signed a preliminary agreement in Guangzhou in its bid to become a full member. In the presence of a number of Chinese and airline officials, Yan Zhiqing, the chairman of China Southern Airlines, said, "This agreement-signing event is an important step forward into the future for China Southern Airlines to adapt itself to the need of further reforms and opening to the international community, as it will strengthen the airline's international cooperation and global competitiveness."
On 13 September, Continental Airlines, KLM and Northwest Airlines joined the alliance. Their simultaneous entry was the largest expansion event in airline alliance history. As a result of the three new members, SkyTeam surpassed Oneworld to become the second largest airline alliance, serving more than 341 million customers with 14,320 daily flights to 658 destinations in 130 countries. Continental and Northwest however would not last.
2006
Following a 23-month joining process since May 2004, Aeroflot joined on 14 April 2006. It was the first Russian airline to be associated with any airline alliance. Aeroflot has increased its operational standards, passing International Air Transport Association's (IATA) Operational Safety Audit (IOSA). Delta's subsidiary Song continued to operate as Delta Air Lines. In June, it was announced that Portugália would become the alliance's next associate member candidate. However, in November, rival airline and Star Alliance member TAP Air Portugal, purchased 99.81% of the airline, bringing a sudden end to its candidacy.
2008 Expansion
In June 2008, following an agreement between Continental Airlines and United Airlines, the former, as well as Copa Airlines, announced their intentions to move to Star Alliance after Continental's final flight with SkyTeam on 24 October 2009. That day, as announced, Continental Airlines and Copa Airlines simultaneously left SkyTeam. Continental Airlines joined Star Alliance three days later; at the time, it was rumored that the switch was Continental's initial move in a United–Continental merger.
Vietnam Airlines in SkyTeam livery
In April 2009, the alliance signed a preliminary agreement with Vietnam Airlines for the airline to become a full member in 2010. Also in 2009, Alitalia-Linee Aeree Italiane re-launched operations as the new Alitalia, and the alliance announced initiatives towards a centralized management based in Amsterdam. The consortium also named a new managing director, Marie-Joseph Malé, who outlined a timeline for the opening of its co-located facilities at London Heathrow Airport, and unveiled a new special livery. The blue and silver SkyTeam livery.
In September of 2009, Olympic Air entered into a codeshare agreement with Delta, a deal that was part of Olympic's intention to join SkyTeam and engage in further discussions with Delta's joint venture partner Air France–KLM. However, ties were cut in 2013 after Star Alliance member Aegean Airlines acquired Olympic Air.
10 YEARS
To start off 2010, Northwest Airlines' and Delta Air Lines' operating certificates were officially combined on 1st of January, while on 9 March, China Southern Airlines announced its plans to join SkyTeam Cargo. With membership expected to be granted in November the same year, the airline was to be the first Chinese carrier to join a global air cargo alliance. On the 16th of April, China Eastern Airlines announced its intention to join SkyTeam, with the official joining ceremony initially expected to occur by mid-2011. The announcement came shortly after the airline's merger with Shanghai Airlines, a member of SkyTeam's rival Star Alliance.
On the 10th of June, Vietnam Airlines became a full member following a joining ceremony held in Hanoi. The airline became the first SkyTeam carrier from Southeast Asia, where Star Alliance has a strong presence through Singapore Airlines and Thai Airways International. With an extra 20 unique destinations added to SkyTeam's route map, Vietnam Airlines helped to strengthen the alliance's foothold in the region.
On 22 June, the CEOs and chairmen of the 13 member airlines gathered in New York to celebrate the alliance's 10th anniversary. During its first decade of operation, the world's second largest airline alliance more than tripled its membership, doubled its flights and nearly doubled its destinations. On the same day, SkyTeam announced that it had renewed its membership program, thereby upgrading Air Europa, Kenya Airways and TAROM statuses from associate to full members. During the ceremony, the Board outlined its plans to recruit members from Latin America, South America and India. Three days later, TAROM officially became the 13th SkyTeam member.
As a part of the celebration, SkyTeam offered reductions of round-the-world fares and other promotions. Following the 10th anniversary, SkyTeam intended to enhance customers' travel experience and deepen cooperation among its members to supplement the expansion into regions that are yet to have SkyTeam members.
Delta One Suite
During the year, Delta Air Lines offered US$1.02 billion to Japan Airlines after the Asian airline filed for bankruptcy due to US$26 billion debt, at the same time lobbying Oneworld's largest member in Asia to switch to SkyTeam. Delta, along with American Airlines, wanted Japan Airlines to be in their respective alliances to benefit from the U.S.–Japan Open Skies agreement. Eventually, Japan Airlines opted to remain at Oneworld, citing that the transfer to SkyTeam would confuse its passengers and may not gain antitrust immunity from U.S. regulators.
Saudia A330 upon landing
SkyTeam then received its second application for full membership within a five-month time-span. China Airlines, Taiwan's flag carrier and largest airline, announced in mid-September that it had formally started the joining process. Upon joining, the airline's route network supplemented those of China Southern Airlines and China Eastern Airlines, allowing cooperation among the three airlines. The following month, Aerolíneas Argentinas signed an agreement to officially start the process of becoming the first South American SkyTeam member. The airline was set to join in 2012.
On the 1st of November, Shanghai Airlines exited from Star Alliance to join SkyTeam in the future under its parent company, future SkyTeam member China Eastern Airlines. This bolstered SkyTeam's presence in the People's Republic of China and surrounding areas, making the SkyTeam the number one alliance in the region. Garuda Indonesia formally started its joining process on 23 November and was scheduled to be integrated by 2012. Upon joining, the airline became the second Southeast Asian airline to join SkyTeam, therefore challenging Star Alliance's dominance in the region through Thai Airways International and Singapore Airlines.
On the 10th January in 2011, Saudi Arabian Airlines signed an agreement to join SkyTeam in 2012. On the 28th of February in the same year, Middle East Airlines agreed to join the alliance. Member airlines Delta and Air France–KLM appointed Goldman Sachs in late February 2011 to advise them on a potential bid for Sir Richard Branson's 51% stake in Virgin Atlantic, which could lead to the airline joining SkyTeam and would sharply increase the alliance's footprint in London. Rivals Star Alliance and Etihad Airlines were also investigating competing options with regard to Virgin Atlantic. China Eastern Airlines joined the alliance on 21 June 2011, along with its subsidiary, Shanghai Airlines, to become the 14th member. Later in 2011, on 28 September, China Airlines joined the alliance. In November the same year, Xiamen Airlines committed to be incorporated as a full member by the end of 2012, with their entry supported by China Southern Airlines.
On 29 May 2012, Saudi Arabian Airlines became both the first carrier in joining the alliance in 2012 and the first one based in the Middle East, which brought the total members to 16. The same day of its incorporation, Saudi Arabian Airlines was renamed to Saudia. Middle East Airlines became the 17th member of the alliance a month later, following its incorporation on 28 June 2012. On 29 August 2012, Aerolíneas Argentinas became the first South American and the second Latin American airline in joining the alliance, bringing the number of members to 18. Following its incorporation on 21 November 2012, Xiamen Airlines became the fourth member in Mainland China, with the overall number of members in the alliance rising to 19. In late June in 2013, the Russian newspaper Kommersant published an article that mentions that Aeroflot was considering leaving the alliance over disagreements with Delta on the pricing on some routes to North America. The report also mentioned that the Russian carrier was considering joining Star Alliance. In order to assess the benefits of the SkyTeam membership, a study was carried out in July; following it, the Aeroflot board reaffirmed its position within the alliance in September 2013.
PRESENT
In November 2018, China Southern Airlines announced that it would leave the alliance effective 31 December 2019.
On 4 November 2019, the International Airlines Group (IAG) announced it was buying Air Europa for €1 billion and that the airline would leave SkyTeam if the deal succeeded. The COVID-19 pandemic and antitrust concerns derailed the acquisition, though negotiations resumed in March 2022 when IAG agreed to grant Air Europa a €100 million loan convertible into a 20% stake. In February 2023, negotiations were completed and IAG agreed to buy the remaining 80% stake in Air Europa (which it plans to keep as a separate brand but have managed by Iberia) for €400 million, subject to European regulatory approval.
On 15 October 2021, Alitalia ceased operations, therefore departing the alliance. Its successor, ITA Airways, joined SkyTeam on 29 October 2021. In 2023, the Lufthansa Group, after confirming its initial acquisition of 41% of ITA Airways, said its plans included gaining total ownership of ITA's shares by 2028 and having the airline leave SkyTeam and join Star Alliance. Its plans, however, remain subject to approval by the European Commission.
On 3 October 2023, Scandinavian Airlines (SAS) announced that a consortium of Castlelake, the Danish state, Air France–KLM and Lind Invest ApS will be the new majority shareholders of the company, and that it would eventually join the SkyTeam alliance, giving up their founding membership of Star Alliance. If the purchase approved by the European Commission, SAS will be the alliance's 20th member while Aeroflot remained suspended.
MEMBERS
Member airlines
Aerolíneas Argentinas
Aeroméxico
Air Europa
Air France
China Airlines
China Eastern Airlines
Shanghai Airlines
Czech Airlines
Delta Air Lines
Garuda Indonesia
ITA Airways
Kenya Airways
KLM
Korean Air
Middle East Airlines
Saudia
TAROM
Vietnam Airlines
Virgin Atlantic
XiamenAir
Aeroflot before sanctions
