WOW and SkyTeam Cargo: Strategic Alliances and Their Impact on Air Cargo Operations from 1998 to 2010 (based on Airline Business Cargo Surveys)

Bachelor Thesis from the year 2012 in the subject Business economics - Supply, Production, Logistics, grade: 1,0, Vienna University of Economics and Business , course: Transportwirtschaft und Logistik, language: English, abstract: The formation of highly integrated strategic alliances in the airline industry started during the1990¿s with Star Alliance as the first global player, as passenger airlines faced deregulation and wanted to support their growth and expansion in international markets. For cargo companies, this type of integration came around later at the beginning of 2000. As a result of this increased co-operation, major alliances were formed with the launch of SkyTeam Cargo and WOW. Beginning at the dawn of the new century, these alliances should mark a cornerstone that enables long term success and survival through synergy effects and higher competitiveness individually and as a group. Now, a decade later, WOW and SkyTeam Cargo have evolved, but in different directions and not all members or ex-members are content with the results. Strategic alliances in air transport have been studied widely in recent publications, most of which just cover the passenger side of the business. There is a lot of information, statements and common knowledge about what benefits alliances can bring to its members, but a literature review leads to the fact that research is very sparse when it comes down to evaluating the actual impact of alliance integration on air cargo carriers¿ standing. Strategic Alliances (WOW, SkyTeam Cargo) in Air Cargo Operations: It is the purpose of this bachelor thesis to analyze and interpret the impact of a strategic alliance on cargo airlines¿ Revenue-Ton-Kilometers key figures (provided by Airline Business 1998-2010) and market share developments. The goal is to provide answers to the questions if air cargo operators did profit from alliance integration and why that was the case or not? Can alliances create value for their respective members by increasing their market share in terms of RTK? Additional questions that will be addressed in the process of answering these core questions: ¿What are the main benefits and disadvantages for alliance members ¿What major challenges do (prospective) members face in an alliance ¿Are there common success and stability factors and why do alliances fail ¿What alternatives are there to alliance formation