Eight Asian budget carriers share booking platforms in landmark pact

By Reuters/Siva Govindasamy   May 16, 2016 | 01:03 am PT
Eight Asian low-cost carriers including subsidiaries of Japan's ANA Holdings Inc and Singapore Airlines Ltd (SIA) have formed a landmark alliance allowing travellers to book flights across their platforms for the first time.

In a statement on Monday, the group Value Alliance said passengers will be able to book over 160 destinations via the websites of ANA's Vanilla Air, SIA's Scoot and Tiger Airways, Virgin Australia Holdings Ltd's Tiger Airways Australia, Thailand's Nok Airlines PCL and NokScoot, Cebu Air Inc's Cebu Pacific, and South Korea's Jeju Air Co.

The alliance, which excludes bigger budget carriers like AirAsia Bhd, will increase the geographical reach of its members by using the strength of each partner's website in its home market, Campbell Wilson, chief executive officer of the medium-haul airline Scoot, told reporters in Singapore.

"We are doing this for our own strategic reasons," Wilson said, when asked if AirAsia and Jetstar from Australia's Qantas Airways Ltd were invited. "The fact that you don't see the others here speaks for itself."

Value Alliance also excludes Indonesia's Lion Air and India's IndiGo.

The goal, instead, is to bring together smaller airlines as an alternative to the AirAsia and Jetstar branded groups across the region, according to people in the industry.

In a single transaction, travellers can select seats, meals and baggage allowances across the websites.

But the cooperation will not be as extensive as full-service partnerships such as Star Alliance, Oneworld and SkyTeam. Those programmes feature extensive codes haring agreements, access to a network of waiting lounges and the ability to redeem points on partner flights.

Deeper partnerships including cooperation across frequent flyer programmes, joint sales and marketing, and coordination on network and prices requires regulatory approval, and are not on the cards, Wilson said.

Asian budget carriers are looking to take advantage of a travel boom in the region, placing orders for several hundred aircraft from Airbus Group SE and Boeing Co.

Boeing's 2015 global market outlook showed Asian low-cost carriers generated average annual growth of 24.5 percent over the previous decade. By comparison, European peers grew 13.4 percent.

The U.S. planemaker also forecast 100 million new passengers entering the Asian market annually for the foreseeable future, creating demand in the next 20 years for 10,370 single-aisle planes such as Boeing's 737 and Airbus' A320.

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