Why do airlines do it?

Airlines codeshare their flights for four main reasons, Wong said.

The first is to allow airlines to expand their route network without deploying additional resources.

“An airline can offer its passengers more destinations without having to operate its own aircraft or create a new route,” he said.

For example, under SIA’s expanded codeshare agreement with Air India, the network covered by the codeshare agreement has added 11 Indian cities and 40 international destinations.

Mr Chua said codesharing is also a “cost-effective way to be present in a market through a partner airline, without having to use your own metal (aircraft), which can result in additional costs.

The second reason is that airlines within an airline group called an alliance usually cooperate with each other, and code sharing is one way to achieve this.

For example, SIA is part of Star Alliance and shares flights with most of the 25 member airlines. Air India is part of Star Alliance.

The third reason is that code sharing also helps airlines improve connectivity between flights, aligning different operators’ different schedules to provide smoother connections.

For example, if a passenger wants to travel from Singapore to Varanasi, India, they do not need to book an SIA flight from Singapore to New Delhi and then a separate ticket on an Indian carrier from New Delhi to Varanasi.

Instead, under the extended codeshare, they will soon be able to book the entire journey under SIA and take an Air India codeshare flight from New Delhi to Varanasi.

“A passenger can book their entire itinerary on one ticket, saving them the hassle of collecting and re-checking their baggage,” Mr Wong said.

Finally, code sharing is also a source of revenue for an airline, which can earn revenue on routes it does not normally serve.

A revenue sharing agreement, which does not necessarily have to be a 50-50 split, is made between partner airlines as customers on these codeshare flights are shared between their respective flights, he added.

How do airlines decide who to share their code with?

Mr Chua said full-service carriers will generally codeshare with other full-service carriers – as opposed to low-cost carriers – and will take into consideration things such as whether the carrier has a section business or first class and a loyalty program, for example. example.

However, Mr Wong said that while service levels are a factor that airlines consider when deciding which airline to partner with, the main consideration remains whether the route networks are complementary.

“From an airline’s perspective, I would prefer to partner with someone who offers complementary routes to mine, without direct competition,” Mr Wong said.

For example, SIA has a codeshare agreement with the American airline JetBlue Airways, which operates domestic flights in the United States and complements SIA’s network.

“SIA will serve major U.S. gateways, and after that you will board a JetBlue flight and fly the remaining distance,” he said.

“The idea is that I offer my clients more destinations than I could otherwise operate myself.”