Blog 79: Analyzing the Star Alliance in 2024
Star Alliance logo
Welcome back to Brooke In The Air! This week we’re revisiting the Star Alliance in 2024! The world’s largest airline alliance.
INTRO
The Star Alliance is the world's largest global airline alliance. Founded on 14th of May in 1997, it is headquartered on the grounds of Frankfurt Airport in Frankfurt, Germany, now with a subsidiary management company in Singapore.
As of November 2023, Star Alliance is the largest airline alliance in the world by market share, with 17.4% of the market share, compared to SkyTeam's 13.7% and OneWorld's 11.9%.
Star Alliance's 26 (and growing) member airlines operate a fleet of over 5,000 aircraft, serving more than 1,290 airports in 195 countries on more than 19,000 daily departures. The alliance has a two-tier rewards program, Silver and Gold, with incentives including priority boarding and upgrades. Like other airline alliances, Star Alliance airlines share airport terminals (known as co-locations), and many member planes are painted in the alliance's livery.
The founding airlines of Star Alliance - United, SAS, Thai International, Lufthansa, and Air Canada
On May 14th in 1997, an agreement forming the Star Alliance was announced with five airlines on three continents: United Airlines, Scandinavian Airlines, Thai Airways International, Air Canada, and Lufthansa. The alliance chose the marketing firm Young & Rubicam, for advertising, with a budget of $25 million (€18 million). The airlines shared the star logo from the beginning, with its five points representing the founding airlines. The alliance adopted its first slogan, "The Airline Network for Earth", with its goal being "an alliance that will take passengers to every major city on earth".
INITIAL ADDITIONS
The now-defunct Brazilian airline VARIG joined the Star Alliance network on 22 October 1997, extending the alliance into South America. Also joining were Ansett Australia and Air New Zealand, expanding Star Alliance to Australia and the Pacific. With the addition of the latter two carriers, the alliance served 720 destinations in 110 countries with a combined fleet of 1,650 aircraft. The next airline to join was All Nippon Airways (ANA), the group's second Asian airline, on 15th of October in 1999.
EXPANSION
During the early 2000s, a number of airlines joined Star Alliance; the Austrian Airlines Group (Austrian Airlines, Tyrolean Airways and Lauda Air) joined on March 26, 2000 and Singapore Airlines on 1 April. Now-defunct BMI (British Midland) and Mexicana joined on 1st of July, bringing the alliance's membership to 13. With Singapore Airlines' entry into the alliance, Thai Airways considered moving to OneWorld, but eventually decided to remain. The addition of BMI made London Heathrow the only European hub with two alliances. During the year, Emirates considered joining Star Alliance, but eventually decided against it. That year the also now-defunct BWIA West Indies Airways, which had entered an alliance with United Airlines, considered becoming a member but did not. In 2000, the alliance also opened its first three business centers (in Los Angeles, Frankfurt, and Bangkok) and announced the formation of an Alliance Management Team (AMT), the partnership's executive body. In September 2001, Ansett Australia (the alliance's only Australian member) left Star Alliance due to bankruptcy, giving most of the Australian market to Qantas (a Oneworld member). That year, Star Alliance announced the appointment of a new CEO, Jaan Albrecht.
Partner airlines promoted the Star Alliance brand with a ‘Round the World’ ticket (RWT) that offered choices of 19,000, 21,000, and 23,000 miles with stopovers of 15 cities valid for one year. RWT was path-breaking in that travel buffs could visit destinations of their choice by charting a yearlong itinerary without disrupting work commitments. Until then, tourists took annual vacations of two or three weeks, often settling for lesser-known destinations because flights were overbooked during the peak holiday season. Customer loyalty ratings went up, driven by the underlying message – Forget about the countries and cities. Go where RWT ticket takes you!
Asiana Airlines joined the alliance on 1 March 2003, Spanair on 1 May, and LOT Polish Airlines (Poland's flag carrier) in October. Around this time, Mexicana Airlines left the alliance after deciding not to renew a codeshare agreement with United Airlines, later joining Oneworld. US Airways joined the alliance in May 2004, becoming its second US-based airline. In November Adria Airways, Blue1 and Croatia Airlines joined the alliance as its first three regional members.
By May in 2007, Star Alliance's 10th anniversary, its members had a combined 16,000 daily departures to 855 destinations in 155 countries and served 406 million passengers annually. The alliance introduced Biosphere Connections, a partnership with UNESCO, the International Union for Conservation of Nature (IUCN), and the Ramsar Convention on Wetlands to promote environmental sustainability.
Shanghai Airlines left the alliance on 31 October 2010 when it merged with China Eastern Airlines, a SkyTeam member. On 29 September, the chief executive board approved Ethiopian Airlines as Star Alliance's 30th member, though Ethiopian did not officially join the alliance until December of the following year. In 2010 the alliance flew to 1,172 airports in 181 countries, with about 21,200 daily departures.
MODERN GROWTH
Since 2011, the alliance has gained several large members, but it has lost others due to collapse or mergers. On 13 December 2011, Ethiopian Airlines joined, adding five countries and 24 destinations to the alliance's map.
Star Alliance tailfins
2012 and 2013 were tumultuous years for Star Alliance, starting with two key departures but ending with a major move into Latin America. In Europe, Spanair ceased operations, and BMI left after being acquired by International Airlines Group (IAG), the parent company of Oneworld members Iberia and British Airways. BMI was integrated into British Airways. In North America, Continental merged with United Airlines, reducing Star Alliance's membership further, even if it effectively remained in the alliance after the merger. On 21 June, though, Avianca, TACA Airlines and Copa Airlines joined, massively increasing the alliance's Latin American presence. In November, Blue1 left after becoming an affiliate of parent Scandinavian Airlines. and Shenzhen Airlines joined, augmenting Air China's Chinese network. Taiwanese carrier EVA Air then joined on 18 June 2013, and after TACA's integration into Avianca, the alliance grew to 28 members, making it the largest of the three major airline alliances. On 13 December, Air India was again invited to begin an integration process with Star Alliance and joined the alliance on 11 July 2014. Following this string of expansions, 2014 opened with two major departures through mergers. First, Brazilian carrier TAM Airlines merged with LAN Airlines to become LATAM Airlines Group, leaving the alliance without a presence in the world's fifth-largest country. Next, US Airways completed its merger with American Airlines and also left the alliance. Both parent companies stayed with Oneworld. On 24 June, though, the alliance finally approved Air India, which joined on 11th of July, leaving the alliance at 27 members.
Future expansion centres around the addition of Connecting Partners, subsidiaries or partners of alliance members which will add connectivity to the alliance without becoming full members. Avianca Brasil joined in this way on 22 July 2015, bringing the alliance back into the Brazilian market and partially filling the void left by TAM. South African Airways' low-cost subsidiary, Mango, was initially announced to join as a Connecting Partner in Q3, 2016 but has since been delayed. Juneyao Airlines, which codeshares with Shenzhen Airlines, joined as a Connecting Partner on 23rd of May, 2017. Thai Smile, subsidiary of Thai Airways, joined as a Connecting Partner in February 2020. On 20th August of 2019, Star Alliance announced affiliate member Avianca Brasil's exit from the alliance from 1 September 2019. The departure, however, won't affect Avianca's membership. In September of 2019, Adria Airways ceased operations, and the airline exited the alliance on 2nd of October in 2019.
Star Alliance North American hubs
TIMELINE
On 16th of November 2020, Asiana Airlines announced their plans to exit the alliance. Asiana will merge with Korean Air, the South Korean Government confirmed, in a $1.6 billion acquisition by the SkyTeam member.
In 2022, Lufthansa announced plans to buy a 40% stake in ITA Airways, a SkyTeam member. If this goes through, then they can become a member of Star Alliance.
On 3 October 2023, Scandinavian Airlines (SAS) announced its plan to leave Star Alliance and join SkyTeam after a consortium including Air France–KLM won the bid in Scandinavian Airlines' Chapter 11 bankruptcy reorganization.
