The SkyTeam Alliance is the latest winner in the resurgent networks of global airline partnerships. Virgin Atlantic Airways, a long-time partner of several SkyTeam members, will join the alliance next year.
The addition of Virgin Atlantic brings the airline’s key London Heathrow hub and numerous transatlantic routes into the SkyTeam network. That will make the alliance a stronger competitor to the likes of Oneworld, which counts Heathrow-based British Airways among its founding members, and even Star Alliance that’s members offer a robust amount of service to the London airport.
For passengers, alliance membership will mean easier travel between SkyTeam members and Virgin Atlantic, as well as reciprocal loyalty benefits. This would also include access to Virgin Atlantic’s lounges for elite members of SkyTeam member loyalty programs.
“Our membership will allow us to enhance established relationships with our valued partners at Delta and Air France-KLM, as well as opening up opportunities to collaborate with new airlines,” Virgin Atlantic CEO Shai Weiss said. “It will enable a seamless customer experience, with an expanded network and maximized loyalty benefits.”
Beyond the extension of loyalty benefits, however, a greater presence at Heathrow is really the only big get for SkyTeam. Now, Heathrow access is not to be undervalued; slots at the airport are among the most sought after in the airline industry. But Virgin Atlantic’s all long-haul network gives the alliance little in added connectivity from the addition.
In fact, only one of Virgin Atlantic’s 25 destinations in September is not served by another member carrier: Barbados, according to Diio by Cirium schedules. Every other city is served by one, if not more, SkyTeam airlines.
Virgin Atlantic will increase SkyTeam’s share of seats at Heathrow by 6 points to nearly 12 percent in September, Diio schedules show. Star has a 19 percent share, and Oneworld 57 percent. And across the North Atlantic between Europe and North America, SkyTeam gains 5 points of share for 29 percent of industry capacity compared to Oneworld’s 24 percent and Star 37 percent.
Virgin Atlantic’s transatlantic routes already operate under an immunized joint venture with SkyTeam members Air France, Delta Air Lines, and KLM. That means its schedules, fares, and other commercial matters between the UK and U.S. — where it provides the most lift to the alliance — are already coordinated with SkyTeam members. Delta also owns 49 percent of Virgin Atlantic.
The partnership is also the latest affirmation of the global alliance model. Prior to the pandemic, many had begun writing off the multilateral networks of airline partnerships in favor of closer, bilateral ties directly between airlines. For example, when Latam Airlines Group announced in September 2019 that it would leave Oneworld and form a joint venture with Delta, it opted not to join SkyTeam. That prompted much speculation that alliances were a dying breed. But the pandemic changed that paradigm as airlines again leaned heavily on their partners amid deep schedule cuts and fleet reductions.
“What we’ve been saying to our stakeholders in Oneworld is that ‘it’s not that you’re wrong, alliances provide this ecosystem that all these bilateral and trilateral partnerships can exist,’” Oneworld CEO Rob Gurney told Airline Weekly last year when asked of the criticisms of alliances.
Oneworld, despite losing Latam, has made the most gains in recent years. It added Alaska Airlines, and the carrier’s deep network along the U.S. West Coast, to its roster last year, and its first African member, Royal Air Maroc, in 2020. And recent reports indicate that African airline RwandAir is considering Oneworld membership. RwandAir is also partially owned by Oneworld member Qatar Airways.
Virgin Atlantic’s membership in SkyTeam will also give travelers better connectivity across alliance members. Aside from its three joint venture partners, the airline only has codeshares in place with two other alliance members: Aeromexico and Middle East Airlines. Virgin Atlantic has interline agreements with the remaining 13 members, and has the “options,” as it put it, to expand these to closer codeshare agreements, for example with ITA Airways or Korean Air.
Air France-KLM and Delta are also in the process of closing a strategic partnership with ITA with financial backing from private equity firm Certares. The partnership could see the Italian airline join the four-way transatlantic tie up with Virgin Atlantic, something that ITA predecessor Alitalia was a member of until 2020 when Air France, Delta, and KLM added Virgin.
“As a member of SkyTeam, Virgin Atlantic will benefit from increased opportunities to expand its global network through partnerships and synergies,” SkyTeam CEO Kristin Colvile. “We are excited to have them as part of the SkyTeam family.”