An Attempt to Measure the Traffic Impact of Airline Alliances

This paper analyzes the effects of airline alliances on the allied partners output by comparing the traffic change observed between the pre- and the post-alliance period. First, a simple methodology based on traffic passenger modelling is developed, and then an empirical analysis is conducted using time series from four global strategic alliances (Wings, Star Alliance, oneworld and SkyTeam) and 124 alliance routes. The analysis concludes that, all other things being equal, strategic alliances do lead to a 9.4%, on average, improvement in passenger volume.