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Star Alliance CEO expresses concerns about Virgin Blue's business model
Wednesday, April 02, 2008
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Star Alliance Chief Executive Jaan Albrecht has expressed concerns about Virgin Blue's business model, saying VJ is not yet a suitable candidate for inclusion in the global air alliance which numbers Singapore Airlines, Thai, United and Air New Zealand.

The Star group has been without an Australian member since Ansett Airlines folded in November 2001. Qantas is a leading member of the rival air alliance, oneworld.

"We are not talking to a carrier in Australia as we speak and it is mainly because of the limited options (in the Australian aviation market) and the business model of Virgin Blue," Albrecht said, speaking in Vienna after a ceremony to mark Star member Austrian Airline's 50th birthday.

He said Star had a series of joining requirements covering service and product standards and it was unlikely that VJ would be able to meet these if it applied to join Star.

"Virgin Blue has made a change from being a purely Low Cost Carrier to something closer to a full service airline model and it's present model does not exclude it from doing a code share with United, for example," Albrecht said. "But there is a clear difference between what carriers do bilaterally to serve a market and making the big step needed to be a member of an alliance."

Asked whether the lack of an Australian Star member left a gap in the alliance's global network, Albrecht said while Star was unable to include inter-Australia domestic flights in its network, the group adequately covered customers using international travel ex-Australasia via the Star memberships of Air New Zealand, Singapore, Thai and United.

Air NZ is believed to be not keen on the idea of VJ joining Star.

Turkish Airlines became the 20th member of Star on April 1 after 16 months of updating its product and business systems. Egyptair will join the alliance next year and Star next wants members in India and Brazil. 

Albrecht said to join Star an individual airline had to be compatible with the alliance in "every part of the product and every part of the buseiness model."

 

Source = e-Travel Blackboard: C.T

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