What once started as a strategic alliance between airlines has now begun to stir up turmoil amongst the top airlines in the world. Qatar Airways’ threat to leave Oneworld has been the result of the program’s effectiveness. The Oneworld alliance sounds ideal in theory, but the reality hasn’t reflected such. But what effects will Qatar Airways’ exit have on the company itself and the remaining alliance?
Qatar Exiting Oneworld
News was released in Q4 2018 that Qatar Airlines was considering leaving the Oneworld alliance. Qatar Airways’ CEO, Albar Al Baker, has been in the media expressing his dissatisfaction with the alliance and individual companies within the coalition that makes it a less favorable partnership to be involved with.
While Oneworld is supposed to operate in conjunction with each other, Qatar Airways has experienced otherwise. Fellow Oneworld members American Airlines and Qantas are a couple of examples of airlines who have plotted against the operations of Qatar Airways. Issues continue to rise between airlines, including politically, that makes it a more attractive idea to exit the partnership altogether.
Does it Really Matter?
The simplified answer of whether it matters if Qatar Airways leaves Oneworld is no. While there are many benefits to being a part of the Oneworld alliance, over the past few years, Qatar Airways has put itself in a position to still gain benefits of the alliance as well as thrive in their environment.
Strategic Investments vs. Oneworld
Qatar Airways is one of the most successful airlines in the world. The company, however, operates more than just their fleet. Qatar Airways has significant investment stakes in many airlines, many of which are also a part of the Oneworld alliance.
Qatar Airways’ positions include a 49% stake in Air Italy, 10% in LATAM, 9.99% in Cathay Pacific, and 20% in IAG (Aer Lingus, British Airways, and Iberia). They also have a recent investment of 5% stake into China Southern who may soon be joining Oneworld.
It’s not just random airlines that Qatar Airways eyes for their new investments. Each of these airlines operate in their respective regions. With stakes in the mentioned airlines, Qatar Airways has effectively cornered the Asia, Europe, and Latin American markets. Even if they leave Oneworld, they will still see benefits globally.
Qatar Airways Influence
In addition to financial gain, investment in several airlines who help make up the Oneworld alliance also has another effect. The investments grant Qatar Airways a seat on the board of each of the airlines. Even if Qatar Airways leaves Oneworld, essentially, they will still have significant influence and benefit from the alliance.
From a consumer perspective, there are many advantages of Oneworld such as routes and reward point perks, all of which make traveling anywhere in the world much more accessible. As the Oneworld program continues to develop, these benefits can translate into significant boosts to the economics of all airlines that are a part of the alliance.
With Qatar Airways maintaining a presence within Oneworld, they will be able to have control over how the program operates, all while acting as their own entity.
Whether Qatar Airways is included as part of the Oneworld alliance or not, the company will still benefit from the operations of Oneworld thanks to their strategic investments. With Qatar Airways still included, many people have concerns that they have too much power and influence to the point of approaching a monopoly.
Will Qatar Airways eventually leave Oneworld? The answer has still yet to be answered. In either scenario, Qatar Airways has put themselves in a position to thrive.