Codeshare business will boost in the “New Normal”
Jul 22, 2020
It is already foreseen that airlines will offer in near and midterm future fewer destinations served by the “own metal”. After the pandemic, the airline world will be different to the world before Covid-19.
The market demand did not disappear completely, and the next months and years are characterized by a slowly increase of demand in air travel. Airlines have to decide if they operate a route with low demand or not. In some cases, it is surely not enough market for operating flights with the own aircraft in a profitable manner.
What are the alternatives for airlines to still keep the destination offered to their passengers? The airline will look for a partner being able to serve the desired market. The usual ways of performing this business model in practice are “interlining“ and “codeshare”. And even more close co-operation forms like “mergers” or “joint-ventures” might be seen more and more in the market, even though in the current situation the latter will not happen too soon.
Nevertheless, codeshare will remain the name of the game, especially after the crisis. The reduced networks will push airlines in more co-operations to keep the offer to passengers stable, even if they do not fly to these destinations on their own. Not to forget: codesharing partner flights has also the effect to bring passengers to the own planes by codeshare connections.
As mentioned in previous blog posts, airlines have to adjust their planning from a seasonal wave to more frequent, maybe monthly, waves. The situation regarding travel restrictions is currently unpredictable, new virus hot spots might lead to new travel regulations, and this means an ad-hoc adjustment of the own and partner networks. Combined with the expected significant increase of MinCT exceptions, there are new challenges where an airline has to fight with: Over the years established processes come to a limit, especially if manual intervention is necessary in between.
Airlines have to adjust their existing processes to the new expected situation; they have to be able to react shortly and in time to market changes; they have to be able to react on schedule waves in between of the “traditional” season changes, also driven by significant adaptations in their partners’ network.
To be prepared for the “New Normal” where a codeshare boost is foreseen, efficient processes and powerful tool support are indispensable.