Taiwan’s Starlux Airlines is a fast growing airline that was founded just before the pandemic. The airline now has A321neos, A330-900neos, and A350-900s, and is quickly expanding. In terms of service to the United States, the airline now flies to Los Angeles (LAX), San Francisco (SFO), and Seattle (SEA), with plans to add even more routes.
One of the challenges that Starlux has faced is its lack of airline partners, limiting the carrier’s reach beyond its own route network. The airline does have a partnership with Alaska Airlines, but that’s about it.
Last year I posed the question of whether Starlux might try to join the oneworld alliance. There’s now an update, as the company has revealed that it wants to apply to join the alliance. Whether or not the airline is accepted remains to be seen.
In this post:
Why it makes sense for Starlux Airlines to join oneworld
Media in Taiwan is reporting that Starlux Airlines has revealed during a meeting for investors that the airline wants to join the oneworld alliance.
The oneworld alliance is the natural hit for Starlux, given the competitive landscape in Taiwan — China Airlines belongs to SkyTeam, and EVA Air belongs to Star Alliance. There’s no way either of those alliances would have two airlines from Taiwan, so it makes sense that Taiwan’s third full service airline would join the third alliance.
For the most part, the global alliances have lost a bit of steam in the past decade, as we’ve seen fewer airlines added than when alliances were still a newer concept. Airlines have largely instead focused on joint ventures and other kinds of partnerships.
But still, when you look at the overall competitive landscape, it sure seems logical for Starlux to join oneworld.
The problem with Starlux Airlines joining oneworld
We now know that Starlux Airlines intends to apply to join the oneworld alliance. I’m sure the oneworld alliance would love for Starlux to join. After all, the alliance makes money from member airline fees, so the more members, the more money. There’s only one major issue — veto rights.
The oneworld alliance has four founding airlines that are still in business, including American Airlines, British Airways, Cathay Pacific, and Qantas. One of the perks of being a founding member of the alliance is that you get veto rights on new members joining.
As you can imagine, this can create a conflict of interest — it could be in the best interest of the alliance at large for a new member to join, while an individual founding member might not view it that way.
It seems highly likely to me that Cathay Pacific would veto Starlux joining the alliance:
- Taiwan and Hong Kong are very close to one another geographically, and the airlines potentially compete in quite a few markets
- Keep in mind that American Airlines invested in China Southern, and China Southern left SkyTeam, but the airline hasn’t joined oneworld; I suspect that’s for the same reason, which is that Cathay Pacific didn’t want the airline to join, given how close Guangzhou is to Hong Kong
Really the alliance veto rights that founding airlines have is probably the biggest thing standing in the way of alliances growing. For example, Alaska only joined the oneworld alliance a few years back, and that was only possible because of American’s support, as the two airlines launched a close partnership.
Who knows, maybe a compromise can be worked out here. After all, a lot of airline partnerships are looking a bit different after the pandemic than they would have several years back. Or if alliance membership isn’t possible, maybe we’ll increasingly see Starlux introduce more reciprocal agreements.
The oneworld alliance has plans to grow in the near future, as both Fiji Airways and Oman Air are expected to join the alliance within the next year or so.
Bottom line
Starlux Airlines would be a logical fit for the oneworld alliance, given that the carrier’s two competitors in Taiwan belong to SkyTeam and Star Alliance. The company’s management has now expressed interest in joining a global alliance.
While I’d love for this to happen, there’s one major thing standing in the way. Cathay Pacific is a founding member of oneworld, and has veto rights on any new members. Airlines tend to want to prevent competitors from joining their alliance. So just as Cathay Pacific didn’t want China Southern to join oneworld, I imagine the airline will have similar feelings about Starlux joining.
Who knows, maybe Cathay Pacific’s thinking has evolved post-pandemic. After all, the world has changed quite a bit, and we’ve seen some things that seemed inconceivable five years ago.
What do you make of the prospect of Starlux joining oneworld?
OneWorld is somewhat weak in Asia, surely CX realizes this to some extent. There is no domestic airline in mainland China that is part of OneWorld, and with JAL and CX both being premium heavy they rarely compete with Skyteam for Trans-Pacific US on fares. CX service is also getting significantly worse over the past year from my perspective as a frequent business traveller to mainland China. Starlux and China Southern would be really useful...
OneWorld is somewhat weak in Asia, surely CX realizes this to some extent. There is no domestic airline in mainland China that is part of OneWorld, and with JAL and CX both being premium heavy they rarely compete with Skyteam for Trans-Pacific US on fares. CX service is also getting significantly worse over the past year from my perspective as a frequent business traveller to mainland China. Starlux and China Southern would be really useful to fill these gaps. It would be nice if the process were more public to set expectations.
Although China Airlines is in SkyTeam, it operates codeshare flights with several OneWorld members, like all flights between Japan and Taiwan with JAL, all flights to Australia for Qantas, all Taiwan-Malaysia flights with MH. Also, Starlux plans to launch flights to HKG, a very crowded market.
Between OM, FJ, WB, and JX, the last one now has the largest fleet (22 aircrafts with 31 more on order) and highest number of scheduled destinations (28 with 4 more in the next 3 months). If JX joins oneworld, it wouldn't even be the "smallest" member (that title will go to FIJI)
I would certainly like Starlux to join OW. But I guess before that we will see a lot of small airlines join (FJ, WY confirmed; WB highly likely; OM possible). None of them is, however, a game changer … But even such small members tend to increase complexity and cost.
I see a veto coming...
Taipei would become a third oneworld hub to compete for Asian transit traffic with HKG and Tokyo... On the other hand, their footprint is still very small, albeit being expanded slowly, but surely...
Porter needs to join OW too.
It would certainly be interesting if Taiwan becomes the 2nd country after the US to have an airline in each of the 3 major alliances. (CX is in OW, but HK is somewhat separate from Mainland China.)
Ha, hard not to be conflicted here. Of course this is an unsurprising and welcome development from a consumer experience standpoint, but as a Delta shareholder it is hard to celebrate when the writing is on the wall as far as the implications for Delta's already-weakened Asia presence and loss-leader west coast "hubs." It's unfortunate that DL is just out-strategized and out-competed at every turn these days. Used to be a good investment.
You should actually be even happier. If anything DL lack of presence actually make them an even better investment. Diverting resources from unprofitable markets to 'premium' markets.
As a DL customer it sucks with limited network.
As a DL investor it's a good investment.
you do realize that AA STILL loses money flying the Pacific and DL made more money per seat mile than UA across both the Atlantic and Pacific.
DAL is the best performing large US airline stock - but when bias drives your understanding of the industry, facts don't matter.
Taiwan is a highly competitive market. As Ben notes, an alliance partnership would make sense but CX could have a thing or two to say.
...you do realize that AA STILL loses money flying the Pacific and DL made more money per seat mile than UA across both the Atlantic and Pacific.
DAL is the best performing large US airline stock - but when bias drives your understanding of the industry, facts don't matter.
Taiwan is a highly competitive market. As Ben notes, an alliance partnership would make sense but CX could have a thing or two to say.
AA isn't even the strongest at any of Starlux's primary US gateways
Having just flown CX in business class from Europe to Asia (and a dozen times previously) and having flown Starlux business from LA to TPE last winter, it would be awesome to see Starlux join OW. Starlux beats CX hands down for both service and food - by a large margin. I hear rumblings of whether TSMC could guarantee enough traffic w/ their new North PHX plant to make a nonstop PHX-TPE flight viable. Fingers crossed.
What’s Starlux’s ground, lounge and dining experience like?
I'd love them to join OW and codeshare with Qantas up to Taiwan. Four or five days a week down to MEL on the 339 would suit me just fine.
Qantas already code-shares and has a loyalty partnership with China airlines and mel-tpe-xxx is one of the few reliably available redemptions of this rock.
Given the absolute LACK of any award availability to Asia these days using AA awards, I would be THRILLED to see a new Asian carrier join oneworld, especially one as highly touted as Starlux.
Cathay and JAL business class availability using AA has disappeared. I'm not traveling then, but checked business class availability to BKK for next March, April, and May from LAX, SFO, SEA and DFW and found nada...zip...zilch! That's nothing for THREE...
Given the absolute LACK of any award availability to Asia these days using AA awards, I would be THRILLED to see a new Asian carrier join oneworld, especially one as highly touted as Starlux.
Cathay and JAL business class availability using AA has disappeared. I'm not traveling then, but checked business class availability to BKK for next March, April, and May from LAX, SFO, SEA and DFW and found nada...zip...zilch! That's nothing for THREE months and FOUR different airports.
Actually, CZ and CX serve totally different market and they would complement each other rather than compete. CX only fly to some handful mainland cities (probably less than 15), and they don't even fly within mainland. That's just a fraction of CZ network within mainland.
And no, there's no express train between HKIA and Guangzhou. You need to go back from HKIA to Kowloon and take the express train from there. The only way to...
Actually, CZ and CX serve totally different market and they would complement each other rather than compete. CX only fly to some handful mainland cities (probably less than 15), and they don't even fly within mainland. That's just a fraction of CZ network within mainland.
And no, there's no express train between HKIA and Guangzhou. You need to go back from HKIA to Kowloon and take the express train from there. The only way to go directly from HKIA to Guangzhou is either infrequent ferry or lengthy bus journey with some immigration hassle. Mainland Chinese cannot even enter HK without permit.
I for one am happy they plan to join. I hope it goes smooth and quickly too!
With competition being a possible factor in why a founding member may veto another perceived competitor joining OW, curious if Qantas initially vetoed Fiji Airways joining OW?
It feels like Qantas/Fiji is a similar dynamic to Cathay/Starlux given they’re both serving the Australia/New Zealand/S Pacific and same N. American cities mostly, no?
Well Fiji has been a OneWorld Connect member for like a decade already, and Qantas and AA were the 2 that sponsored them. I think this is more a function of OW realizing that having a "part-time" membership class was confusing for customers and no one else ever joined under that banner, although Mongolian was considering joining as a OW connect (with Cathy's blessing as a sponsor too). Do hopefully now Mongolian with join as a full member as well now too.
Qantas is a shareholder of Fiji Airlines, so I seriously doubt that.
People preach about democracy and equality, yet the rigged UN has five veto power nuclear warlords.
Oneworld, like UN, isn't there for the members, but it's there to rig the system and make sure they will never lose their powers.
Do you just write irrelevant (and patently stupid) nonsense, to see how many responses you'll get?
Oneworld is a private organization meant to align marketing strategies, for the benefit of a handful of airlines plus the associated carriers that they chose to sponsor. It's not a world governing body, and has no "power" over anything.
Hypocrites have infiltrated every organization, from private organization to world governing body.
Stupid idiots like you don't get it and allow these people abuse their power.
Even you are convinced it has no power over anything. Others have pointed out they have the power to veto out a potential member. Even if that member is beneficial to the organization and their customers, it's competing against a veto power.
On the other hand, the world...
Hypocrites have infiltrated every organization, from private organization to world governing body.
Stupid idiots like you don't get it and allow these people abuse their power.
Even you are convinced it has no power over anything. Others have pointed out they have the power to veto out a potential member. Even if that member is beneficial to the organization and their customers, it's competing against a veto power.
On the other hand, the world governing body actually has no power. Not only it can't mediate peace, it allowed 2 major wars in the same time. It's just there to legitimize the veto nations interests not the members.
^ This is mind-numbingly stupid.
don't worry... some of us do get it.
Alliances protect themselves and their power just like other organizations.
No. He's not smart enough to troll. He's just patently stupid & seeking confirmation bias.
There has always been huge HKG-Taiwan traffic, all the way back to before cross-strait flights to China were permitted.
CX is aimed at the mainland China and Europe markets.
Starlux is focused more on Southeast Asia and US.
Too bad the "Oneworld Connect" concept is defunct, StarLux may have been a fairly good fit for that, and served only the handful of carriers who needed them there. Maybe that would've been enough to bypass any ire by Cathay?
Highly doubtful. The whole reason why Fiji is now joining as a full member is an admission that the "connect" platform never worked. It was confusing to everyone involved, especially flying customers. Not one other airline ever joined the connect, although Mongolian had considered it with Cathay as a sponsor. Be a full member or nothing, "part-time" and half in/half put doesn't seem to work in airline alliances.
they should join SkyTeam™ instead, for the obvious reason
From day 1, starlux clearly intended to join OW as part of their mid term plan. I would argue they built most of their network fully intending to be complimentary, not competitive to CX. While there is always a veto possibility, the likeliest reason would be maturity and stability.
CX would need to stop running 5th freedom flights out of TPE to Japan.
STARLUX serves many cities that Cathay do not. I think there is enough traffic for both airlines to service the major cities in Japan.
CX has 5th freedom flights via tpe to kix, ngo, and nrt, and the schedule timetable is terrible, departing tpe to kix 1300 pm and nrt 1100 am (which makes reward availability abundance btw), and returning to tpe from kix 1600 and from nrt on 1715, which is okay.
Hey Lucky,
This is a bias article on a slow news day. Totally clickbait. ;)
Global airlines just joined Star Alliance three hours ago and you’re reporting about this…
What??? All of this comment makes zero sense. Talk about "biased click bait"!!!
Have another drink, mate…
I think the long-term viability of Starlux might also be a factor here. Oneworld may not be willing to take the risk. They got burned by Kingfisher, who were announced as a new member, then they very quickly melted down and Oneworld had to rescind the invitation.
And who, other than aviation geeks (who'll fly all manner of OneWorld airlines anyway) remembers anything about the above? Guarantee you that 99% of the population, Indian or worldwide, don't.
That's hardly a reason for them not to consider a potential carrier that may benefit them, should the founders agree.
I would also add that the founding family of Starlux is one of the key pillars of Taiwanese economy, comparing them to Kingfisher is as relevant as chalk is to cheese.
The Alaska partnership was definitely a step in the right direction. Starlux needs time to get more of a foothold though. It's still way too new in my books to demonstrate how sustainably it can operate and grow.
I think it needs to wait for more deliveries. Over half of its aircraft haven't even been delivered. With most of them being widebodies.
I would not be surprised if CCCP tell CX which way to vote. It would not be the first time they have involved themselves in how CX is run, and I cannot see how they would be in favor of anything that aids Taiwan's integration into the rest of the world
Assuming the same logic, how did EVA Air join Star Alliance when Air China and (then) Shanghai Airlines were already members? And the same goes to China Airlines joining SkyTeam when China Eastern and (then) China Southern were already members? All of these airlines are state-owned as well. Furthermore, EVA and CAL maintain codeshare partnerships with numerous mainland Chinese airlines, even those outside their alliance (EVA with Air China, Hainan Airlines, Shandong, Shenzhen, Juneyao /...
Assuming the same logic, how did EVA Air join Star Alliance when Air China and (then) Shanghai Airlines were already members? And the same goes to China Airlines joining SkyTeam when China Eastern and (then) China Southern were already members? All of these airlines are state-owned as well. Furthermore, EVA and CAL maintain codeshare partnerships with numerous mainland Chinese airlines, even those outside their alliance (EVA with Air China, Hainan Airlines, Shandong, Shenzhen, Juneyao / CAL with China Eastern, China Southern, Shanghai Airlines, Xiamen Air)?
I'd reckon that for a small, privately-owned Taiwanese airline to join oneworld wouldn't (and shouldn't) the CCCP too much.
FYI: I don't believe that any of those Chinese airlines were founding members of their perspective alliances, & therefore have or had "veto" power's.
Founders still active:
SkyTeam ~ Delta, AirFrance, AeroMexico, Korean Air
StarAlliance ~ United, Thai Airways, Lufthansa, AirCanada (SAS was also a founder, but just left the alliance)
CCCP is a misspelling of SSSR - or USSR, the Soviet Union. They stopped existing in decades ago.
CCP, the Chinese Communist Party, is probably what both of you meant...
It would be good for just about everyone for Starlux to join OW. I hope Cathay does not block this. Any more word on Cathay switching to *A?
The only founder-member of an alliance to switch to another is SAS, and that’s only because AF-KLM swooped in as the primary shareholder, enough to force it to quit the alliance it founded and move to SkyTeam. Do you think Air China’s shareholding in CX is so significant as to push it towards an alliance with too much Chinese presence as it is? Don’t you think Oneworld needs both Cathay and Starlux in it, seeing...
The only founder-member of an alliance to switch to another is SAS, and that’s only because AF-KLM swooped in as the primary shareholder, enough to force it to quit the alliance it founded and move to SkyTeam. Do you think Air China’s shareholding in CX is so significant as to push it towards an alliance with too much Chinese presence as it is? Don’t you think Oneworld needs both Cathay and Starlux in it, seeing as it has never had any other Chinese-speaking members? (Hainan, Sichuan, etc. never cared to join Oneworld.)
Starlux is anything but a competitor to CX on many of its routes — JX doesn’t even fly to HKG — and I have a hard time understanding why Ben keeps trotting out the CX veto card. I for one would love to see Starlux in Oneworld, as the alliance has never had a Chinese-speaking member other than CX. Look at Star with EVA, Air China, Shenzhen and (kinda) Juneyao as Sinophone members, and SkyTeam...
Starlux is anything but a competitor to CX on many of its routes — JX doesn’t even fly to HKG — and I have a hard time understanding why Ben keeps trotting out the CX veto card. I for one would love to see Starlux in Oneworld, as the alliance has never had a Chinese-speaking member other than CX. Look at Star with EVA, Air China, Shenzhen and (kinda) Juneyao as Sinophone members, and SkyTeam with China Airlines, China Eastern, Xiamen and Shanghai Airlines as Sinophone members. Oneworld would do very well with a second Sinophone airline, no matter how small, and Starlux is luxurious enough for Oneworld’s premium image.
One should note that Starlux does not serve Mainland China, Hong Kong, South Korea or Indonesia, all of which are major Asian markets. (It does serve Macau, though, for what it’s worth.) Instead Starlux has narrowed its focus to the following Asian countries: Japan in North Asia — where most of its A330-900neo operations are — plus Thailand, Vietnam, Malaysia, Singapore and the Philippines in ASEAN (notice, no Indonesia), and the United States. It doesn’t plan to serve Australia either, and as for India, Taiwanese airlines never cared about it anyway.
I stand corrected regarding Indonesian service. Starlux has announced plans for Jakarta in a few months’ time, though I wonder why it can’t send a widebody to CGK. Apologies!
JX is also launching Hong Kong services next month, two daily flights with an A330-900 and A350-900 each.
JX will start HKG service next month, 2x daily. Nevertheless, I largely agree with your points.
Starlux launches flights to HKG next month, fyi.
Fyi Starlux is launching to HKG next month.
OK, Steve, many people have said above that JX is launching HKG, which I’d missed when talking about launching CGK. My bad, okay? There’s no need to repeat the same thing.
I was wondering about this myself earlier when I found out they’ll be launching 5 weekly flights to Jakarta starting September.
Cathay & Starlux may indeed be competing for traffic connecting SE Asia & Southern China to North America. Starlux has progressively been growing their route network in these 2 markets, very much aware of their potential and how it put China Airlines & EVA Air where they are now. We have to assume...
I was wondering about this myself earlier when I found out they’ll be launching 5 weekly flights to Jakarta starting September.
Cathay & Starlux may indeed be competing for traffic connecting SE Asia & Southern China to North America. Starlux has progressively been growing their route network in these 2 markets, very much aware of their potential and how it put China Airlines & EVA Air where they are now. We have to assume a Cathay veto is inevitable, so what would the alternative be for Starlux?
CX today is a shadow of the former airline; it's veto heft should carry less weight as such.
That's not how vetoes work.
Yeah, that's not how it works.....
Look up the definition of veto. You either have it or you don’t; it’s binary, not a sliding scale.
Are CX and JX really that much in competition anymore? CX doesn't use TPE as a de-facto hub as much as they used to and now relies far more on transiting to mainland than they did historically (which will never be a frictionless option for a Taiwanese carrier), and despite the instinct to lump in Hong Kong and Taiwan, they are two very different O&D markets.
Guangzhou is literally right next to HKG (the Chinese...
Are CX and JX really that much in competition anymore? CX doesn't use TPE as a de-facto hub as much as they used to and now relies far more on transiting to mainland than they did historically (which will never be a frictionless option for a Taiwanese carrier), and despite the instinct to lump in Hong Kong and Taiwan, they are two very different O&D markets.
Guangzhou is literally right next to HKG (the Chinese government would certainly consider them in the same metro area), you can't really say the same about TPE.