Might Finnair soon leave the oneworld alliance?
Finnair’s chief Pekka Vauramo is angry. The major gaps in oneworld’s worldwide flight network as the precise gaps that Finnair deems essential for growth. With no alliance partners in China or India, Finnair sees a huge missed opportunity.
While Finnair serves a number of destinations in North America (including New York, Miami, Chicago, and Toronto) its longhaul focus is on Asia. With Helsinki falling on the shortest natural flight path between many cities in Europe and Asia, the city is a natural stopping point.
Vauramo stated—
In the long run, we do need a partner in China if we want to continue to grow that business — and we want to continue to grow that business. We’re at a disadvantage because we don’t have that.
His solution is consolidation. Currently the Finnish government owns 56% of Finnair. This is by law. Vauramo proposes legislation that would end that requirement and allow the carrier to consolidate with a partner, presumably with partners in China.
SAS Marriage?
I’m just thinking out loud, of course, but I think SAS and Finnair would make a cute couple. There is some overlap in the route network but HEL could be a hub for Asian traffic while OSL/CPH/ARN could be a hub for U.S. traffic. SAS, a Star Alliance members, opens up partnership opportunities with Air India, Air China, and Shenzhen Airlines.
Vauramo singles out the partnership between Emirates and Qantas to suggest what is possible. Qantas is a oneworld member while Emirates is unaligned. I’m not sure if Finnair has any strategic partnerships in mind, but perhaps it should focus first on a strengthened relationship with fellow oneworld member Cathay Pacific. Certainly, Cathay’s reach into Mainland China is not anything like China Eastern, China Southern, or Air China. Nevertheless, Cathy and Cathay Dragon do serve many secondary cities in China that could be better timed with the arrival and departure of Finnair’s Hong Kong flight.
CONCLUSION
Finnair is not the only alliance member unsatisfied with the status quo. But status quo is hard to break. Many pieces would have to fall into place in order for Finnair to leave oneworld or even find a dependable Mainland carrier to partner with.
If the thinks Asia is the key to success why doesn’t Finnair launch flights to all those places in Asia that he wants to serve? It’s like someone coming up with a problem but doesn’t offer a true solution. It’s easy to complain. I also see other OW partners expanding into China as much as they can so it’s not like the others in the alliance aren’t pulling weight.
Easy for us armchair airline execs to say, but the name of the game isn’t just access but connectivity, especially to second-tier cities that a smaller foreign carrier like Finnair either can’t afford to send a widebody to, or don’t have fifth-freedom rights to tag to a flight to another city in the region, or ability to acquire slots, overflight, and landing rights.
The solution to most/all of these problems? A local partner, preferably in the same alliance you just happen to be in. Oneworld, when it comes to India and China, are lacking said local partners.
I also disagree on your notion that Varamo doesn’t “offer a true solution”, disagree on the viability of his solution all you want but he definitely offered one.
Nevertheless, an SK/AY merger would actually solve some of SAS’ problems…..