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Europe's airlines in China: Lufthansa and AF-KLM largest as British Airways/oneworld play catch up

27-Feb-2013

China is the world’s most populous nation and its second largest passenger aviation market with enormous growth potential in spite of some regulatory brakes. So why is it that some European countries are under-served to China by their home carriers, in particular Spain, but also Italy and the UK? It is not an easy market to serve and yields remain low, but it is a must-do market.

Air China and Lufthansa are the biggest players on Europe-China and this is reflected in the Star Alliance controlling almost half of the seats on these routes and SkyTeam’s Air France and KLM both have strong positions in Amsterdam and Paris respectively. By contrast, British Airways finds itself in the most competitive Europe-China market, the UK and without a Chinese partner.

While BA is starting a Chengdu service and increasing its Shanghai frequency from six times weekly to daily, Iberia is absent entirely from China and IAG looks very under-represented in this large and fast-growing market. In spite of Finnair carving out a successful niche, oneworld is an also-ran on Europe-China, with only a 10% share.

China is the world’s number two aviation market with huge growth potential

China is the world’s number two market for passenger airline services, as measured by total seat capacity. While 78% of this capacity is domestic, China still ranks as the seventh largest international aviation market and the largest outside Europe, the US and the United Arab Emirates.

But it is not just its current size that makes it attractive to foreign carriers, it is its potential.

Top 20 airline passenger markets by seats 13-May-2013 to 19-May-2013

 

Country

Seats

1

United States

20,040,378

2

China

9,857,499

3

United Kingdom

5,005,837

4

Germany

4,829,115

5

Japan

4,433,581

6

Spain and Canary Islands

3,681,833

7

France

3,263,523

8

Brazil

3,013,579

9

Italy

2,981,057

10

India

2,747,313

11

Indonesia

2,464,811

12

Australia

2,283,059

13

United Arab Emirates

2,213,987

14

Canada

2,114,176

15

Turkey

1,998,492

16

Russian Federation

1,984,847

17

Thailand

1,710,194

18

South   Korea

1,636,471

19

Malaysia

1,530,679

20

Hong Kong

1,492,087

In economic terms, China remains a developing nation with GDP per capita well below the global average. Airline seats per capita are well correlated with GDP per capita and the aviation market should continue to grow as China’s economy continues to grow. In addition to growth in GDP per capita driving growth in the aviation market, China’s current level of seats per capita is around half of what might be expected given its level of GDP per capita and this suggests additional growth potential.

There are currently regulatory controls that perhaps restrict it from moving closer to the trend line, but, over the long term, China should become the world’s largest aviation market by some distance, particularly if it moves to a more liberalised environment. In its 2012 Current Market Outlook, Boeing forecast average growth in international RPKs from China of 7.2% p.a. from 2012 to 2031, compared with 5.0% p.a. globally.

GDP per capita and passenger airline seat capacity per capita

Relative liberalisation and traffic

Air China and Lufthansa put Star on top of Europe to China routes

Star Alliance groups Air China and Lufthansa take the first two positions on routes between Europe and China and so it is no surprise that Star is the leading alliance between Europe and China with 47% of seat capacity. SkyTeam members Air France-KLM and Aeroflot are in third and fourth respectively and their two Chinese alliance partners are in fifth and sixth, making SkyTeam the number two alliance with 32%.

Within SkyTeam, these relationships are further strengthened by the joint venture agreements between Air France-KLM and China Southern. By contrast, IAG has a very small presence on routes to China (all through British Airways), and even ranks behind fellow oneworld member Finnair. Overall oneworld has a paltry 10% share, the same as all the non-aligned carriers.

These alliance figures, however, have different meanings. SkyTeam's presence between Europe and China is the most coordinated and cooperative, with AF-KLM having a JV with China Southern and a proposed one with China Eastern. In Star, Lufthansa and Air China see each other as competitors even if there is codesharing. Lufthansa targets connecting traffic beyond German hubs while Air China flies directly to numerous European cities. oneworld is the least coordinated between Europe and China, but then again it is the loosest global marketing alliance. BA and Finnair are competitors and Finnair's fundamental strategy of linking Europe with Asia via Helsinki caused it to be hesitant of welcoming Qatar Airways into the oneworld alliance as a member elect. While fellow oneworld carrier Cathay Pacific does not link Europe to mainland China directly, it does so through its Hong Kong hub, and views BA and Finnair as competitors for Europe-China traffic.

Top 14 airline groups Europe to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline Group

Total Seats

% of Total

1

Air China Limited

53,788

22%

2

Deutsche Lufthansa AG

37,118

15%

3

Air France-KLM S.A.

26,364

11%

4

Aeroflot - Russian Airlines Group

19,076

8%

5

China Southern Air Holding Company

18,988

8%

6

China Eastern Air Holding Company

16,344

7%

7

Turkish Airlines Group

13,300

6%

8

Hainan Airlines Group (HNA)

10,860

5%

9

Finnair Group

9,968

4%

10

International Airlines Group

7,840

3%

11

SAS Group

5,880

2%

12

Virgin Atlantic

3,792

2%

13

LOT Polish Airlines S.A.

2,520

1%

14

Ukrainian Aviation Group

896

0%

 

Others

13,792

6%

 

Total

240,526

 100%

oneworld remains weak on Europe-China

oneworld is the biggest of the alliances on Europe to Hong Kong routes, but it remains in third place when aggregating this with Europe to China. The China-UK bilateral has been capacity constrained; BA and Virgin Atlantic fought strongly for the right to fly to Shanghai, which Virgin won (BA later got access, too). Consequently, Virgin's London-Shanghai service is one of its most successful. The lack of slots at Heathrow has not helped either carrier, and neither has the lack of slots at Beijing and Shanghai; Air France in comparison has double daily services to both Beijing and Shanghai whereas BA has at most one daily flight.

BA has become emboldened by its acquisition of bmi and bmi's precious Heathrow slots. Additional services to Beijing and Shanghai are constrained by the slot situation in those airports, so BA is targeting secondary cities (something of a misnomer given populations that exceed better-known European counterparts). BA has spoken of the potential to have upwards of five more Chinese destinations by the end of the decade, a very achievable goal considering the number of secondary cities competitors serve.

oneworld does not have a mainland Chinese member (Hainan is largely the only option left) and this is matter of contention between most oneworld members and Cathay Pacific, which sees itself as capable of serving the mainland China market (its Dragonair subsidiary is the largest foreign carrier in mainland China). BA especially however wants a mainland member and Mr Walsh will advocate for this. American Airlines, reflecting its focus on the US and Europe, is less pushy for a mainland member but already has a partnership with Hainan Airlines.

See related article: After Xiamen and Shenzhen Airlines join SkyTeam and Star, where next for global alliances in China?

Global alliances on Europe to China by capacity (seats) 13-May-2013 to 19-May-2013

Alliance

Seats

% of total

Star Alliance

112,606

47%

Skyteam

78,072

32%

oneworld

25,196

10%

Non-aligned

24,652

10%

Total

240,526

100%

Top 20 airlines Europe to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Air China

53,788

22%

2

Lufthansa

28,048

12%

3

Air France

20,912

9%

4

China Southern Airlines

18,988

8%

5

Aeroflot

16,376

7%

6

China Eastern Airlines

16,344

7%

7

Turkish Airlines

13,300

6%

8

Hainan Airlines

10,860

5%

9

Finnair

9,968

4%

10

British Airways

7,840

3%

11

S7 Airlines

7,388

3%

12

SWISS

6,370

3%

13

SAS

5,880

2%

14

KLM Royal Dutch Airlines

5,452

2%

15

Virgin Atlantic Airways

3,792

2%

16

Vladivostok Air

2,700

1%

17

Austrian Airlines

2,700

1%

18

LOT - Polish Airlines

2,520

1%

19

Ural Airlines

2,496

1%

20

Transaero Airlines

2,298

1%

 

Others

2,506

1%

 

Total

240,526

 100%

Germany, France and the UK are biggest western Europe-China markets, but Spain remarkably small

The biggest Europe-China country pair is Germany, followed by Russia, France and the UK. Turkey is also a significant market, as is Italy in spite of the absence of its national carrier on routes to China. Remarkably, Spain is only the number 15 country on Europe-China routes. Given that Spain is Europe’s sixth most populous country and the world’s fourth biggest international aviation market, this is at first blush surprising.

The reason is that Asia is not in Iberia's genes. The carrier operates a westward-facing hub at Madrid with long-haul flights all going to the Americas or Africa; its furthest easterly route is to Israel. This weakness in Asia has been turned into an advantage to the Middle East network carriers.

See related article: Emirates' Spanish expansion highlights Iberia's long-haul weakness to the east

IAG is well aware of Iberia's absence in Asia, but addressing this – even before toils with Iberia's unions and mounting losses – has been difficult. Building the Iberia brand in Asia would take time and investment whereas using BA generates scale.

Iberia's main market is linking Europe to the Americas; Asia would represent a significant strategy shift. There is tremendous potential for linking the growth economies of Asia with Latin America, but the distances involved mean that non-stop flights will be very limited. While Iberia has the network in Latin America it does not have one in Asia. Conversely, BA has a sizeable network in Asia but is lighter in Latin America. IAG does not view two-stop Asia-Latin America connections in London Heathrow and Madrid as viable.

One-way seats between China and European countries 13-May-2013 to 19-May-2013

This analysis will focus on routes between China and the major western European countries, looking at the market share by seat capacity for the leading carriers on each country pair and which European and Chinese carriers operate on the relevant city pairs. In each of the three biggest markets – Germany, France and the UK – the European ‘flag carrier’ is the market leader, while a number of the smaller countries are dominated by a Chinese carrier. In all countries, routes to Chinese cities other than Beijing and Shanghai are often highly monopolistic.

Germany-China dominated by Star Alliance

Lufthansa has 54% on Germany-China and its Star partner Air China has 36%, giving the alliance a dominant position. Out of nine city pairs between Germany and China, only two include a non-Star competitor (Hainan Airlines is the only operator on Berlin-Beijing and China Eastern competes with the two Star carriers on Frankfurt-Shanghai).

Airlines Germany to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Lufthansa

14,024

54%

2

Air China

9,414

36%

3

China Eastern Airlines

1,848

7%

4

Hainan Airlines

896

3%

 

Total

26,182

 100%

Germany to China passenger routes 13-May-2013 to 19-May-2013

European
city

Chinese city

Carrier

Weekly
Frequency

Equipment

Planned start
(where not

yet operated)

Berlin Tegel

Beijing

Hainan Airlines

4x

A330

 
           

Duesseldorf

Beijing

Air China

4x

A330-300

 
           

Frankfurt

Beijing

Air China

14x

777-300

 
   

Lufthansa

7x

A380-800

 

 

 

       

Frankfurt

Chengdu

Air China

3x

A330

19-May-2013

 

 

 

     

Frankfurt

Nanjing (Nanking)

Lufthansa

3 x weekly

A340-300

 
           

Frankfurt

Shanghai Pudong

Air China

7x

A330

 
   

China Eastern

7x

A330-200

 
   

Lufthansa

14x

747-400
and A340-600

 
   

 

     

Frankfurt

Shenyang-Qingdao

Lufthansa

3 x weekly

A340-300

 
   

 

     

Munich

Beijing

Air China

5x

A330

 
   

Lufthansa

7x

A340-600

 
   

 

     

Munich

Shanghai Pudong

Lufthansa

7x

A340-600

 

France controlled by SkyTeam

Air France has 58% on France-China and its SkyTeam partners China Eastern and China Southern have 15% and 9% respectively, giving SkyTeam a dominant position. Out of five Chinese cities served from Paris CDG, only two include non-SkyTeam competitor Air China (on CDG to Beijing and Shanghai).

Airlines France to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total   Seats

% of   Total

1

Air France

10,456

58%

2

Air China

3,344

18%

3

China Eastern Airlines

2,640

15%

4

China Southern Airlines

1,708

9%

 

Total

18,148

 100%

France to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Planned start
(where not yet operated

Paris CDG

Beijing

Air China

7x

777-300

 

 

 

Air France

12x

777-300ER

 

 

 

 

     

Paris CDG

Guangzhou

Air France

5 x weekly

777-200

 

 

 

China Southern

7x

A330-200

 

 

         

Paris CDG

Shanghai Pudong

Air China

4x

A340

 

 

 

Air France

12x

777-300ER

 

 

         

Paris CDG

Shanghai Pudong

China Eastern

10x

A330-200

to 13x from 30-Sep-2013

 

 

 

     

Paris CDG

Wuhan

Air France

3 x weekly

777-200

 

UK-China is much more competitive – but the UK is disadvantaged by visa-related issues

The UK market is more competitive: British Airways has only 34% on UK-China and it has no oneworld partners between the two countries. Air China is not far behind with 29%. BA competes with Air China on London Heathrow to Beijing and Air China also flies to Beijing from Gatwick. On Heathrow to Shanghai, BA competes with China Eastern and local rival Virgin Atlantic, whose 17% share could move to SkyTeam alongside China Southern and China Eastern to give SkyTeam a total of 37% if Virgin decides to join the alliance following its partnership with Delta. BA will be increasing it Shanghai service from six times weekly to daily in Mar-2013 and starting Heathrow-Chengdu in Sep-2013 with a weekly frequency of three.

BA's entrance into Chengdu is its first route to a Chinese city other than the heavyweights of Beijing and Shanghai. Competitors Air France, Finnair, KLM and Lufthansa serve secondary cities.

Western European passenger routes to China, excluding Beijing and Shanghai: 20-Aug-2012 to 26-Aug-2012

Carrier Chinese city European city Frequency Equipment Commencement
Air China Chengdu Frankfurt n/a n/a 2013 – proposed
Air France Guangzhou Paris CDG 4 x weekly 777-200 2004
  Wuhan Paris CDG 3 x weekly 777-200 2012
China Southern Guangzhou Amsterdam Daily A330-200 2011
  Guangzhou Paris CDG Daily A330-200 2004
  Guangzhou London Heathrow 3 x weekly A330-200 2012
Finnair Chongqing Helsinki 4 x weekly A330-300 2012
KLM Chengdu Amsterdam 4 x weekly 747-400 2006
  Hangzhou Amsterdam 4 x weekly 777-200 2010
  Xiamen Amsterdam 3 x weekly 777-200 2011
Lufthansa Nanjing (Nanking) Frankfurt 3 x weekly A340-300 2008
  Shenyang-Qingdao Frankfurt 3 x weekly A340-300 2012

See related articles:

BA and the UK at large are disadvantaged in the China market. Connections in London to elsewhere in Europe are circuitous by nature. Visa formalities are also a significant hindrance. Aside from the excessive UK visa paperwork and fees compared to neighbouring countries, a UK visa only grants Chinese nationals entrance to the UK.

In comparison, applying for a visa to one of the Schengen countries gives entrance to the entire bloc, enabling Chinese nationals to take the grand European tour so many aspire to.

Airlines UK to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

British Airways

3,920

34%

2

Air China

3,304

29%

3

Virgin Atlantic Airways

1,896

17%

4

China Southern Airlines

1,220

11%

5

China Eastern Airlines

1,056

9%

 

Total

11,396

 100%

UK to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly
Frequency

Equipment

Planned start
(where not yet operated)

London Gatwick

Beijing

Air China

4x

A330

 
           

London Heathrow

Beijing

Air China

7x

A330 and 777-300*

 
   

British Airways

7x

747-400

 
           

London Heathrow

Chengdu

British Airways

3x

777-200

22-Sep-2013

 

         

London Heathrow

Guangzhou

China Southern

5x

A330-200

 
           

London Heathrow

Shanghai Pudong

British Airways

7x

777-200

6x to 7x from 31-Mar-2013

   

China Eastern

4x

A330-200

 
   

Virgin Atlantic

6x

A340-600

 

Italy is controlled mainly by Air China

Air China has a strong position on Italy-China, a country pair that is not served by any Italian carrier from this summer (Alitalia will cease its four times weekly Rome-Beijing service in Mar-2013). Air China is a monopolist on Milan-Beijing, Milan-Shanghai and Rome-Beijing, while China Eastern is the sole operator on Rome-Shanghai.

Airlines Italy to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Air China

4,658

72%

2

China Eastern Airlines

1,848

28%

 

Total

6,506

 100%

Italy to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Milan Malpensa

Beijing

Air China

3x

A330

         

Milan Malpensa

Shanghai Pudong

Air China

7x

A330

         

Rome FCO

Beijing

Air China

7x

A330

 

       

Rome FCO

Shanghai Pudong

China Eastern

7x

A330-200

The Netherlands dominated by SkyTeam

The Netherlands is the only sizeable Europe-China market where the flag carrier is both still present and is not the leader by seat capacity. Given that the leader is fellow SkyTeam member and strategic partner China Southern, KLM is unlikely to be troubled by what is a complete SkyTeam monopoly. The other interesting feature of Netherlands-China is that six Chinese cities are served from Amsterdam, more than any other European hub, with KLM serving five of them. As in Paris CDG, this positions SkyTeam carriers to compete strongly for connecting passengers to China from Spain and the UK, who are under-served by their own flag carriers.

These markets are heavy on connecting traffic; about 70% of KLM's total network traffic is connecting, according to the carrier. KLM has also worked with China Southern, and is now working with Sichuan Airlines, to spool-up sixth-freedom traffic.

Airlines Netherlands to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

China Southern Airlines

3,416

56%

2

KLM Royal Dutch Airlines

2,726

44%

 

Total

     6,142

 100%

Netherlands to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Amsterdam

Beijing

China Southern

7x

A330-200

 

 

KLM

7x

747-400

Amsterdam

Chengdu

KLM

4 x weekly

747-400

Amsterdam

Guangzhou

China Southern

7x

A330-200

Amsterdam

Hangzhou

KLM

3 x weekly

777-200

Amsterdam

Shanghai Pudong

KLM

12x

747-400

Amsterdam

Xiamen

KLM

3 x weekly

777-200

Finnair’s unusual and successful niche

Finland is an unusual and interesting case in that it is the most significant European market where routes to China are controlled by a single player. Moreover, the size of the Finland-China market by seats is much larger than might be expected given Finland’s population of less than six million. The market is not much smaller than Italy-China, for example, although Italy’s population is more than 10 times larger.

This reflects two very contrasting strategic approaches by the flag carriers. Alitalia simply does not fly to China (as from Mar-2013), preferring to offer its passengers flights on alliance partners’ aircraft, while Finnair has carved a successful niche out of targeting passengers from Europe to Asia by taking advantage of the geographical positioning of its Helsinki hub. Finnair’s strategy depends on feeder traffic from around Europe and this has sometimes proved a challenge, but the absence of any Chinese competitor at Helsinki demonstrates that it would be even more of a challenge for them. Moreover, setting aside Beijing and Shanghai, Finnair has also chosen destinations in China not served by other European carriers – namely, Chongqing and, starting on 14-Jun-2013, Xian.

See related article: Finnair is betting on Asian flights to underpin its growth

Airlines Finland to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Finnair

4,984

100%

Finland to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Planned start
(where not yet operated)

Helsinki

Beijing

Finnair

7x

A340

 

 

 

 

     

Helsinki

Chongqing

Finnair

4 x weekly

A330-300

 

 

 

 

     

Helsinki

Shanghai Pudong

Finnair

7x

A340

 

 

 

 

     

Helsinki

Xian

Finnair

3x

A330-300

14-Jun-2013

Switzerland is dominated by Star

The Swiss market is also dominated by the Star Alliance, with SWISS and Air China at number one and two respectively. SWISS serves Beijing and Shanghai from its Zurich hub.

Airlines Switzerland to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

SWISS

3,185

64%

2

Air China

1,096

22%

3

Hainan Airlines

672

14%

 

Total

4,953

 

Switzerland to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Planned start
(where not yet   operated

Zurich

Beijing

SWISS

7x

A330-300

 

Zurich

Shanghai Pudong

SWISS

7x

A340-300

 

Geneva

Beijing

Air China

4x

A330-200

07-May-2013

Denmark: a small market controlled by SAS

SAS attempted some years ago to position itself as the logical choice for Europe-Asia passengers given the position of its Copenhagen hub on the great circle routes from western Europe. However, a combination of internal restructuring challenges and Finnair pursuing this strategy better have limited its success.

It remains a monopoly player on Denmark-China, but the size of this operation is not very significant and it only serves Beijing and Shanghai.

Airlines Denmark to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

SAS

2,940

100%

Denmark to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Copenhagen

Beijing

SAS

7x

A340-300

         

Copenhagen

Shanghai Pudong

SAS

5x

A340-300

Smaller Europe-China country pairs are controlled by monopolists (mostly in Star alliance)

Airlines Sweden to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Airline

Total Seats

% of Total

1

CA

Air China

1,505

100%

Sweden to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Stockholm

Beijing

Air China

5x

A330-301

Airlines Austria to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Austrian Airlines

1,350

100%

Austria to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Vienna

Beijing

Austrian

6x

767-300

Airlines Poland to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

LOT - Polish Airlines

1,260

100%

Poland to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Warsaw

Beijing

LOT

5x

787-800

Belgium is the only Europe-China country pair controlled by a non-aligned carrier, Hainan Airlines, which has built a small but significant market share by attacking niche markets with no direct competitors (see also Berlin-Beijing).

Airlines Belgium to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

Airline

Total Seats

% of Total

1

Hainan Airlines

1,120

100%

Belgium to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Brussels

Beijing

Hainan Airlines

5x

A330

Airlines Spain to China by capacity (seats) 13-May-2013 to 19-May-2013

Rank

 

Total   Seats

% of   Total

1

Air China

1,096

100%

Spain to China passenger routes 13-May-2013 to 19-May-2013

European city

Chinese city

Carrier

Weekly Frequency

Equipment

Madrid

Beijing

Air China

5x

A330

See related articles:

Partnerships and investments are high on the agenda for China

British Airways' Mr Walsh last year talked pro-actively of investing to expand, where organic growth was not a sufficient strategy. Although there has been no major step in that direction yet, it is clear that Asian partnerships are an important feature of where IAG and BA see the future. The Europeans are not alone in this; many Asia Pacific airlines are also hoping to link closely with a Chinese airline on the crowded dance floor. US airlines are meanwhile not so preoccupied.

The introduction of Qatar Airways to oneworld will give the alliance – and IAG – some additional leverage in serving China when the Gulf carrier comes on line. This was one of the very reasons Finnair was reluctant to see Qatar admitted to the alliance. But, where the SkyTeam and Star members are reasonably well-established in their (not always easy) partnerships with Chinese airlines, this is an area where BA/IAG now has little option but to focus. And 2013 is the year when it needs to happen.


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