A Strategic Analysis of the Oneworld Airline Alliance

Global airline alliances enable member airlines to increase profits. They achieve this by increasing customer willingness to pay and reducing costs. Deep levels of partnerships are required to drive these benefits. The ability for partners to closely integrate is largely dependent on antitrust immunities being granted by regulators, which enable joint venture partnerships. The Oneworld alliance is poised to capitalize on a recent decision by the United States Department of Transportation and European Union Regulators to grant antitrust immunities between its two largest partners, American Airlines and British Airways. However, the Oneworld members must increase both their alliance‘s network size and the depth of partnerships if they are to optimize profits from their alliance.