Friday, August 14, 2009

Continental to Join Star in October

After clearing a needless protracted approval process, Continental Airlines announced that it will officially join the Star Alliance on October 27.  See Doug Cameron, Continental to Join Star Alliance, Wall St. J., Aug. 13, 2009 (available here).  According to the report:

The quick move into Star will allow Continental to leverage its new partners' route networks and frequent flyers at a time when airlines face a slump in demand, notably among high-margin business passengers.

The carrier was invited to join Star by UAL Corp., after it rejected a merger in favor of a commercial pact with the parent of United Airlines, a founder member of the alliance alongside Deutsche Lufthansa AG.

It was also wooed by the third airline group, Oneworld, led by American Airlines' parent AMR Corp. and British Airways PLC, which is seeking to match the antitrust approval for cooperation secured by Star and SkyTeam.

What the link-up also means is that SkyTeam will have an authentic competitor in the transatlantic market, a definite boon for consumers looking for cheaper, more convenient, travel options in tough economic times.  This competitive situation would no doubt be improved by a third grant of approval and immunity to oneworld despite the protestations of competing carriers like Virgin Atlantic.  Until that approval comes down, there will remain lack of parity in the market.

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