Thanks for all the insight, let's highlights some interesting points and continue the discussion.
(1). Interline in your hub in a big country such as USA, China or Europe can help you both grow your connections. It nicely multiplies connections and scheduling efficinecy, and therefore the number of passengers you wil get, and the number of flights you can make. This works well in big countries with many possible hub airports (as mentioned, US/CA/EU/CH/JP/AU), because once you are done with hub 1, you can go ahead and jointly build hub 2, hub 3, etc.
Multiplying connection is indeed mutually beneficial for both airlines. The idea to jointly build next hub is also interesting. But as has been said, this required the airlines to be co-located in countries with high demand, otherwise it might not be suitable.
I don't agree with (3).
For your example, it may seem that IL is not necessarily in the beginning. However, when you are running jumbos, like 747, 777 between SIN and CGK, you will need that IL. For my airline, more than half of the passengers on my flights to Singapore are connection passengers. Also, when you have that IL, you can run flights from SIN to transfer impossible airports in Indonesia. In that case, you are providing connection flights for you IL partner in SIN. Because SIN market is more about international flights, most of the passengers on your connection flights are international passengers. It won't affect your domestic market since domestic passengers will still stay on your domestic network.
Take a look at Kai Tak serve, you will see how it works. The network between Asia Smile - TJE - Tekong Airways - Aero Southern. All the airlines are helping each other to provide a better network.
I'm under the impression that running widebodies on short sector is not so efficient in AS due to longer ground time. Also when you said half of your passengers in CGK-SIN sector are connecting passengers, you confirmed that you are actually feeding your neighbor's airline instead of feeding your own direct long haul from Jakarta. Surely your domestic routes are all yours, but the neighbor airline could actually fly to each of your cities, directly picking up passengers and feeding their own long haul in their Singapore hub. I was wondering, would it be better to not interline and develop your own international long haul in Jakarta. While the interline might work in term of multiplying connection, your neighbor get more benefit from the feed while your own international long haul routes are cannibalized. As a side note, your Indonesian transfer impossible airports got nothing to do with this Singapore interline thing, as the passengers connecting thru Singapore and from there, they can fly to any Indonesian airports unrestricted.
1. it depends greatly on the relative size of the airline companies. I have some small airlines and they do not interline with huge airlines at all. It's simply too expensive and the benefits are marginal.
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I tend to micro-manage as well, to see if their incoming flights coordinate with my departure waves.
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I tend not to interline with airlines in a neighbor country, if both of us have similar size international network. In the real world this has been the case, as larger airlines in neighbour small countries are always competitors and never interline.
1. especially if you are small, you kinda need interline from bigger airline to keep you grow, although chances are slim those big boys wanna play along.
2. agree, otherwise it's useless
3. agree on AS, but in real life, they do interline as big countries with large domestic market usually don't open all their airports for international traffic.
Hi
1/ Interline in same country can be benefit if the hubs and flights of partners are not the same. Example : Jakarta and Bali-Denpasar to provide an access to passengers to the local network of each partner. If the hub is the same, it can help new airlines to grow and to have more connexions, but it's not really a long term view.
2/ An interline between 2 airlines in different countries with only one exploiting the route to your hub is a benefit for both, as the other airline can provide you passengers. Otherwise, an interline with an airline who has no connexions with your network is a nonsense (example when you have a route from Jakarta to Perth and you sign with an airline of Sydney that has no flight to Perth neither to Jakarta :))
3/ Interlining with airlines in Singapore or Hong Kong, destinations with NO local market can be an interest when you connect to an airline that can provide you departures to destinations that you don't serve
Have a nice WE !
1. why you say access, when both airline have unrestricted access to same local market as they are located in same country. would rather say the benefit similar to previous post, multiplying connection, and also not for long term.
2. how about this, consider ultra long haul LHR-SYD. Airlines A based in LHR, fly LHR-DXB. Airline B based in DXB, fly DXB-SIN. Airline C based in SYD, fly SYD-SIN. Suppose C wanna fly to SYD but its own metal is better utilized on other route. If C only interline with B, and B doesn't fly DXB-LHR, then C can't provide its passengers access to LHR. However if C and A interline, both also interline with B, although A doesn't fly to SYD and C doesn't fly to LHR, C can offer connection to LHR and A can offer connection to SYD, thanks to B. :D
3. in case for airline in Indonesia, imo, interlining with HKG based airline is much preferred than SIN. While both have good internation connection and no domestic market, HKG farther distance from CGK and the rest of Indonesian airports will encourage HKG airlines to use CGK as connecting point rather than flying direct to all Indonesian airports.
Anyone else have thoughts?