"Cross-border ownership issues prevent airlines consolidation"
British Airways boss Willie Walsh boarded a Kingfisher flight to India
in August to solemnise a code-sharing agreement, which would allow BA
customers access to Indian domestic routes using the Kingfisher network.
Walsh took out time to speak to BT'S T.V. Mahalingam.
British Airways boss Willie Walsh boarded a Kingfisher flight to India in August to solemnise a code-sharing agreement, which would allow BA customers access to Indian domestic routes using the Kingfisher network. Walsh took out time to speak to BT'S T.V. Mahalingam. Edited excerpts:
Code-sharing arrangement with Kingfisher: Kingfisher will be joining the Oneworld Alliance. From a Oneworld perspective, we have been looking for an Indian partner. So, we have had meetings with Kingfisher and Jet on several occasions the past few years. Oneworld encourages strong partnerships between airlines within the alliance.
India's aviation infrastructure: It is a topic that comes up everywhere in the world. In China, everyone talks of infrastructure. You go to the United Kingdom, it is the same. In India, it is a reflection of the growth in demand. We have seen new airports (Hyderabad, Bangalore), we have seen new terminals (Delhi)… there is investment going on, but it is not able to match up with the growth in demand.
The changing nature of industry: Ours is a fragmented industry. There are over 1,100 airlines in the world. Over half of them were created in the last 10 years. So, we have an industry that has not consolidated mainly because there are issues around (cross-border) ownership.
Words of advice for Air India, which faces labour issues, like BA: The airlines industry has changed structurally in the last 10 years. Six hundred new airlines, cost of fuel… 10 years ago, it was $30 a barrel, now it is $80 a barrel. Airlines have to respond. Those that do not respond will continue to make losses, and you cannot keep believing that governments will bail you out with cash. These are structural problems that need to be tackled and that is what separates the winners from the losers.
Code-sharing arrangement with Kingfisher: Kingfisher will be joining the Oneworld Alliance. From a Oneworld perspective, we have been looking for an Indian partner. So, we have had meetings with Kingfisher and Jet on several occasions the past few years. Oneworld encourages strong partnerships between airlines within the alliance.
India's aviation infrastructure: It is a topic that comes up everywhere in the world. In China, everyone talks of infrastructure. You go to the United Kingdom, it is the same. In India, it is a reflection of the growth in demand. We have seen new airports (Hyderabad, Bangalore), we have seen new terminals (Delhi)… there is investment going on, but it is not able to match up with the growth in demand.
The changing nature of industry: Ours is a fragmented industry. There are over 1,100 airlines in the world. Over half of them were created in the last 10 years. So, we have an industry that has not consolidated mainly because there are issues around (cross-border) ownership.
Words of advice for Air India, which faces labour issues, like BA: The airlines industry has changed structurally in the last 10 years. Six hundred new airlines, cost of fuel… 10 years ago, it was $30 a barrel, now it is $80 a barrel. Airlines have to respond. Those that do not respond will continue to make losses, and you cannot keep believing that governments will bail you out with cash. These are structural problems that need to be tackled and that is what separates the winners from the losers.
