British Airways: “Down under’s not over”
There’s a great modernity about British Airways’ simple but stylish Australian newspaper advertisement. Taking a subtle, cheeky swipe at Qantas following the ending of the Joint-Service Agreement in favour of Emirates, British Airways is keeping calm and carrying on.
BA will upgrade all its Australian services to new B777-300ER aircraft from March 30, 2012. Timed to match the commencement of the Qantas Emirates partnership, the introduction of the aircraft with upgraded long-haul product, and BA’s shift of Australian services from London Heathrow’s T3 to its T5 hub marks another competitive upgrade in the fierce Australian international market.
The move is part of BA’s renewed focus on the Asia-Pacific region. BA will commence five weekly services to Seoul from next month, and three weekly services to Chengdu from September 2013. In addition, BA is likely to recommence schedules to Kuala Lumpur and Taipei, markets the carrier exited in 2001, as well as new services to additional cities in mainland China.
There is also nothing delicate about British Airways’ new oneworld push. For many years oneworld has been quiescent, foundering without a meticulous leader as Star Alliance has in Lufthansa. But the signs are this has changed, limited by expansion options at London Heathrow, British Airways and its parent company International Airlines Group (IAG) are making an active effort to engage and mold oneworld into an entity that supports BA’s sustainable growth and underlying business goals.
British Airways has already formed a comprehensive JV partnership with oneworld member and long-time Qantas partner Japan Airlines, and invited Qatar Airways to join oneworld in 2013/14. Could BA’s Asian focus see the airline engage Malaysia Airlines in place of Qantas to expand in South-East Asia?
Malaysia Airlines has much to offer BA, with a South-East Asian network, services to every major Australian city, and code sharing agreements with Japan Airlines, as well as oneworld members-to-be Qatar Airways and SriLankan Airlines already in place. To leverage this through an alliance or a comprehensive JV between the three carriers opens up incredible network and traffic flow options as the map shows. The grouping would be well placed to gain a formidable position in the growing high yield markets driven by Asia’s growing middle class, and provide substantial traffic feed into BA’s long haul network in Asia, and connections to BA short haul services across Europe.
oneworld is on the brink of change, and British Airways is now firmly at the helm. Tally ho.