It has been a while since Qatar Airways’ CEO, Akbar Al-Baker, has made a public empty threat. Though that streak ended this week, as Al-Baker has threatened to have Qatar Airways leave the oneworld alliance.
Why Qatar Airways is threatening to leave oneworld
Al-Baker seems to take issue with both American and Qantas. Here’s what Al-Baker has to say about American, according to FlightGlobal:
“But I don’t think that is any more the spirit of the alliance, especially since American Airlines is continuously targeting Qatar Airways, slandering Qatar Airways, giving misinformation to the US government about Qatar Airways. And now it is targeting our investment in Air Italy at very high level government interaction, claiming that we are cheating on the open-skies agreement that we signed with the US government.”
And here’s what he has to say about Qantas:
Al Baker is also unhappy with Qantas’s behaviour, which has an extensive tie-up with Gulf rival Emirates while its relationship with Qatar is “trivial”, he says. “And it is blocking us getting rights into Australia. So what is the point of us being in this alliance if it is only in the interest of a few and the interest of the rest is compromised?”
What’s my take on this?
Qatar Airways is right to be frustrated
In general, Al-Baker is right to be frustrated. I totally agree that the ridiculous targeting the US carriers have done of the “big three” Gulf carriers is unfounded at worst, or inconsistent at best. There’s no reason they should be targeting Emirates, Etihad, and Qatar, if they’re not going to target Air India, Alitalia, Saudia, etc.
But this targeting of Gulf carriers is nothing new.
Alliances aren’t as important as they used to be
Alliances are so 10 years ago. Let’s keep in mind that when alliances were first formed a couple of decades ago, they were largely between airlines that actually had very close relationships already, so the development of these alliances was a natural extension.
But over time we’ve gotten to the point where the alliances have taken a “the more the merrier” approach, and in many cases there’s not much value in many of these partnerships.
I think this is why we’re seeing alliances deemphasized while we’re seeing joint ventures emphasized. It’s true that historically Qantas’ most important partners have been American and Emirates (though that has shifted), and those partnerships have been more valuable than their partnership in oneworld.
Qatar Airways won’t leave oneworld
Al-Baker is understandably expressing frustration, but when push comes to shove he won’t actually have his airline leave oneworld. Why?
- Other than membership dues, the airline isn’t actually losing out on a lot by being in oneworld, and they’re certainly getting a lot of new customers thanks to it
- Qatar Airways has invested in IAG (the parent company of British Airways and Iberia), Cathay Pacific, and LATAM, all of which are in oneworld, so it would be illogical for them to leave the alliance, especially as they’re working towards strengthening relationships with these airlines
Bottom line
While I think Al-Baker is right to be frustrated, he’s also a bit like the boy who cried wolf, because it’s highly unlikely the airline will leave the alliance. Let’s keep in mind that he made exactly the same threat in 2015.
What do you make of Al-Baker’s statement?
i am newly signed up with aadvantage but am surprised to hear about this qatar leaving stuff.lots of us including those in australia and new zealand find this way to europe if you are heading to a place other than london,paris,rome,munich,istanbul to name but a few more convenient than flying to any of the places i have mentioned with an asian carrier and connecting to say a lufthansa,air france,ba,turkish airlines or alitalia onwards to the...
i am newly signed up with aadvantage but am surprised to hear about this qatar leaving stuff.lots of us including those in australia and new zealand find this way to europe if you are heading to a place other than london,paris,rome,munich,istanbul to name but a few more convenient than flying to any of the places i have mentioned with an asian carrier and connecting to say a lufthansa,air france,ba,turkish airlines or alitalia onwards to the out of the way places and the schedules a lot easier given you can fit in a last full day of work get home get showered ready and off to the airport before your trip.
Is it news when Al-Baker throws his toys out of his cot again?
@Lucky or anyone — Firstly, pardon my ignorance. How do alliances actually work? What values do they bring to member? When an airline join an alliance, do they automatically get access to the routes served by other members ( i.e. MH getting access to BA’s European network or QF getting access to AA’s domestic network) or do they still need to enter into a formal agreement with each member for the privelege (i.e LH/AC with...
@Lucky or anyone — Firstly, pardon my ignorance. How do alliances actually work? What values do they bring to member? When an airline join an alliance, do they automatically get access to the routes served by other members ( i.e. MH getting access to BA’s European network or QF getting access to AA’s domestic network) or do they still need to enter into a formal agreement with each member for the privelege (i.e LH/AC with CX or QF with EK)? If it’s the latter, then the only benefit is for the customers (mile accumulation, status recognition, baggage allowance etc.) while it’s still business as usual for the airlines, is that so? Then if an airline goes into a working agreement with enough member of an alliance, is it technically a member as well considering it enjoys the same benefits?
@ Joe -- Hopefully this post answers many of your questions:
https://onemileatatime.com/interline-codeshare-alliances-joint-ventures/
You ask some other great questions about the inner workings of alliances, and I'll try to address those in a post.
I am Exec platinum on AA. And flew 4 flights on QR in business this year from USA to Asia. If QR leaves one world, I will have to leave QR. I love their service and they are my #1 choice everything else being equal. But I won't fly them if they leave the alliance or offer very attractive fares
Qatar is my favorite airline but American is my primary airline for most of my travel. Being Exec Plat with AA makes me very loyal to oneworld. As such, I spend about $12k a year just with Qatar. As much as I love them, if they were to leave oneworld I would have to take that spend to another airline. So I hope they see the sales pipeline they get, especially with premium class business travel, by being in oneworld.
“Alliances are not as important as they used to be” - thats exactly why qatar can and will leave oneworld. This is not why they will stay with oneworld.
@ VJ -- Except alliances have been heavily deemphasized since the airline even joined oneworld. This has been going on for years. And let's remember Al-Baker has been threatening this for years.
As a United Airlines flyer I totally disagree with your assertion that alliances are “so ten years ago”. Apart from (IMHO) star alliance is the best, and it is 20 years old, alliance members of UA keep me united to them. I understand what you are saying but if alliances are dead I would find myself trying out independent carriers like Norwegian or Emirates. But I feel Star has me covered, so I don’t.
Ba and qr already have jv in between doh-lon, i think....
Alliances are indeed history and in all three groups there are a lot of false friends. For example LH is also offering connections with CX (via HKG) and QF (via SIN or BKK) to go to Australia instead of privileging SQ and TG ... And they are often cheaper...
@CR - you weren't far off the truth with your statement.
https://www.qantasnewsroom.com.au/media-releases/cathay-pacific-and-qantas-codeshare-to-bring-australia-and-asia-closer/
This is admittedly at least partially in response to Virgin Australia's tie up with Hainan Airlines and their various stable mates though.
Generally, the comments by al Baker on Qantas "blocking" them are nonsense. Qantas do not own airports or set policy as it impacts QR.
VT-CIE says:
October 9, 2018 at 10:35 am
@CR: Did you mean ‘form a strategic partnership with QR’? You wrote QF. I have never known CX and QF to be friends.
Yes, sorry, that's right. I got the codes messed up.
Has anyone noticed that there is no premium cabin availability for the foreseeable future using AA miles on some other one world carriers. RJ, QR, EK. I have been searching for something and have come up empty.
Another reason for Qatar to stay....being part of One World drives business to them that would otherwise go to EY or EK. There are definitely North American based South Asians who book on Qatar between North America and South Asia so they can credit to AA to help with domestic travel (miles and status). Without One World membership, this group would just book based purely on price...
One of the few reasons I stick with AAdvantage: Qatar Airways. Their J product and service are just so so good! Premium fares are often reasonable. I just love flying with them. I have not flown AA domestically this year (except connecting to international). Why would anyone pay $5000 on AA when they have the option to fly much superior products offered by QR/JL/CX for less than $2000 sometimes? I just don’t get it. Someone please tell me.
@CR: Did you mean 'form a strategic partnership with QR'? You wrote QF. I have never known CX and QF to be friends.
@VT-CIE - Regarding CX, the relationship looks to be short-lived. CX used to operate one of the two frequencies between DOH and HKG and formed a strategic partnership with QF. But they discontinued the flight (not sure about the partnership). I think they are just working within the alliance now.
Frienemies is probably the best way to describe alliance partners in general outside of those with a JV.
@VT-CIE
for CX, BA has a jv with them and QR has the stake. AA's partnership with CX isn't close, unlike with BA or JL. Even they were both oneworld founding members, I feel like those two hate each other or something (heck, AAdvantage doesn't even give miles for CX economy flights that are not in Y/B/H class, which I haven't seen any blogger point out yet so...)
Is al-Baker vacationing in someplace where it is cold and he needs to keep warm? Because he's blowing off some steam from the sounds of it.
Bazinga.
Lucky (or anyone), what about this part of my question?
'Where does CX stand? Is QF an enemy? What about LA and JAL? And AY?'
Who is IAG's greater friend in Oneworld? AA or QR? Where does CX stand? Is QF an enemy? What about LA and JAL?
@ VT-CIE -- Operationally they no doubt have a much closer relationship with American than with Qatar. But there is something to be said for Qatar owning a stake in IAG, so...
How likely is it that their investment into IAG, in the long term, leads to IAG and Qatar leaving Oneworld and starting their own JV?
@ HK -- It seems highly unlikely given how close the joint venture is between American and British Airways on transatlantic flights. It's arguably the most important JV for both airlines, so the conflict of interest that BA has between American and Qatar will continue to exist.