Bangkok Airways: No alliances

Bangkok Airways: No alliances

Member restrictions deemed too onerous

SET-listed Bangkok Airways Plc (BA) has rejected the idea of joining an international airline alliance, saying it sees no advantage to belonging to one.

A Bangkok Airways A319 jet aeroplane sits at Udon Thani airport. The SET-listed carrier says it sees no advantage in joining any global airline alliance.

Prohibitive annual membership fees, reportedly running at US$750,000, and annual operating costs of $2.5 million were cited as the primary factors discouraging carrier from joining one.

Tight restrictions imposed by alliances such as the Star Alliance, Oneworld or SkyTeam barring member airlines from entering into business partnerships with airlines outside the alliance were another reason.

"We are absolutely not going to join them. We're better off staying outside," a senior Bangkok Airways executive said, adding that membership could not justify all those charges and restrictions.

The source was responding to last Friday's commencement of Bangkok Airways' participation in Global Explorer, the round-the-world fare offered by Oneworld member airlines and selected partners outside the alliance.

Participation in the scheme, which basically adds Bangkok Airways' fares and network to Oneworld's global programme, should not be interpreted as the alliance making inroads into the airline, the source said.

Most importantly, joining any airline alliance would undermine Bangkok Airway's long-standing strategy of expanding its code-share arrangements with other airlines, the source said.

Bangkok Airways has active codeshare partnerships with 17 airlines, some belonging to various alliances and some belonging to none.

Alliance rules discourage or even bar member airlines from striking up codeshare cooperations with outside carriers.

Code sharing has been an essential tool for Bangkok Airways to feed international passengers from foreign carrier partners into its routes in Thailand and to neighbouring countries.

That has been a main growth strategy since Bangkok Airways has not embarked on a significant expansion of its network, which covers 11 domestic destinations plus 13 international ones.

Bangkok Airways' negative stance on alliance participation comes amid renewed scepticism of the model's merits by the head of Emirates, which has shunned alliance membership.

Early this week, Emirates president Tim Clark branded the alliance model as "the old way" of doing things and said passengers today cared more about good value than collecting miles.

Bangkok Airways stressed it had been invited to join the popular Global Explorer programme.

Its participation brings Global Explorer's coverage to 215 destinations in Asia and 1,150 worldwide.

BA shares closed yesterday on the SET at 19.70 baht, down 30 satang, in trade worth 16.6 million baht.

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