Air India joins Star Alliance, sees 5 percent revenue jump

New Delhi, June 24 (IANS) Air India has joined Star Alliance and the membership will help the national carrier gain nearly five percent rise in its revenues, Civil Aviation Minister Ashok Gajapathi Raju Pusapati said Tuesday.

The board of the 26 Star Alliance members agreed to allow Air India into its fold at a meeting in London Monday.

"There is a foreseeable revenue increase for Air India after it joins the biggest Alliance. Its a win-win situation for all. The passengers are going to benefit enormously due to this move," the minister said, announcing the entry of the national passenger carrier into the inter-airline association.

Air India's revenue currently stands at around Rs.19,000 crore per annum, and it is expected to rise 4-5 percent following the move. This increase is expected to take the overall revenue to about Rs.23,000 per annum.

The Star Alliance, through its 13 member airlines which operate in India to 10 destinations, accounts for a total share of 13 percent of India's to and fro market. The inclusion of Air India in the alliance will take this share to about 30 percent.

Air India became the 27th member after a wait of nearly seven years.

Air India's Chairman and Managing Director Rohit Nandan told IANS: "The entry into the alliance is due to increase in passenger satisfaction levels, improvement in quality of services and overall successful implementation of merger between Air India and Indian Airlines."

"Air India is expected to benefit out of increase in revenues, savings in bulk fuel purchases and offering better and premium products to our passengers through Star Alliance networks."

Currently, most of the passengers on Air India's flights to the US and Europe do not get connecting flights to other destinations which are farther apart.

This will change as other Star Alliance members will be able to provide single ticket travel to these destinations on their flights.

Air India has also become the only airline from India to have joined a global inter-line pact -- the other two inter-line pacts are of oneworld and SkyTeam.

The airline is said to have met most of the the minimum joining requirements (MJRs) for its entry into the alliance, including the information technology (IT) systems synchronisation.

Air India will formally join as member from July 11, 2014. Till that time all the integration systems including the IT backup and ticketing systems will be checked.

Air India will also host the heads of the Alliance airlines here in December.

Joining the alliance will bring in immediate benefits for Air India's frequent fliers as they will be able to access lounges the world over and single-ticket travel across airlines and other such facilities.

The arrangement is the largest among the three global interline unions with a total airline membership of 26 with 21,900 daily flights to 1,328 airports in 195 countries.

Air India wanted to join Star Alliance ever since it was invited in 2007 as it entails benefits such as improved product offering, better service standards, access to new markets and premium customers and partnership with leading global carriers.

Currently, Air India operates flights to around 60 domestic destinations and has a network of 33 international routes with a fleet of 125, which includes Airbus A-319, A-320, A-321, A-330, Boeing 737, B-777, B-747 and B-787 Dreamliners besides ATR-42 and CRJ aircraft.