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Aer Lingus Seeks Trans-Atlantic Pact as Alternative to Alliance

  • 28-09-2011 10:13pm
    #1
    David086
    Registered Users, Registered Users 2 Posts: 623 ✭✭✭


    Finally a bit of good news for aviation in Ireland.

    http://www.businessweek.com/news/2011-09-28/aer-lingus-seeks-trans-atlantic-pact-as-alternative-to-alliance.html

    Sept. 28 (Bloomberg) -- Aer Lingus Group Plc plans to join a trans-Atlantic airline venture in the next few years after scrapping plans to become a member of a global alliance, Chief Executive Officer Christoph Mueller said in an interview.

    The Irish carrier decided against alliance membership in August because of the cost, and regards one of three antitrust- immune trans-Atlantic pacts involving British Airways, Deutsche Lufthansa AG and Air France-KLM Group as offering better value, Mueller said in London, adding that it aims to enlist by 2013.

    Bilateral accords in which Aer Lingus would fly connecting traffic to the hubs of partners are also being pursued, he said while declining to disclose details.

    Aer Lingus doesn’t need investment from a larger carrier to ensure its survival, the CEO said. The Irish government has said it may auction a 25 percent stake in the carrier next year to pay down debt, while Ryanair Holdings Plc has said it could sell its 29 percent of stock after being thwarted by regulators in successive attempts at a full takeover.

    “We have the financial strength to keep our independence,” Mueller said. “Do we need a big brother coming in, a trade investor? Definitely not.”

    Aer Lingus has break-up value 1.27 billion euros, the CEO said, and a market capitalization of 342 million euros.


Comments

  • #2
    Plowman
    Registered Users, Registered Users 2 Posts: 2,630 ✭✭✭Plowman


    This post has been deleted.


  • #3
    H6
    Closed Accounts Posts: 6 ✭H6


    It has been found not to make economic sense for EI for a number of reasons.

    Lounge/facilities - EI would be obliged to offer lounge facilities in all all its airports. AFAIK one or two of the alliances require the lounge to be an EI Lounge and not a shared airport lounge also. (EI currently has around 3/4 - DUB-LHR-BOS-? branded lounges)

    IT infrastructure would require a massive upgrade so that the same services are offered across its network and would require new handling contracts in some cases. ( This was one of the main reasons for leaving OneWorld originally)

    Narrow body Cabins would have to be reconfigured to offer business class.

    As noted in London yesterday, the extra connectivity gained by joining an alliance would be countered by the fact that they would have to sever ties with airlines in the other alliances. EI currently has 3 major codeshare agreements with airlines in One World (BA), STAR (United) and SkyTeam(KLM). Apparently, joining one would mean dropping the other 2. CM made the point that this 'neutrality' is one of its assets.


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