Star Alliance—the largest of the three global airline groups—is planning to offer a co-branded credit card that will allow a person to redeem points across all 26 members. The card, to be launched later this year, will allow users to earn points via their spending, like a regular credit card, and then redeem those points via the frequent-flyer programs of any of the airlines, Star Alliance CEO Jeffrey Goh said at a briefing Thursday. Star Alliance members span airlines from Singapore Airlines Ltd. to Deutsche Lufthansa AG and United Airlines Holdings Inc. The unusual move is aimed at better linking peoples’ credit card spending with loyalty miles. Loyalty programs can be a very lucrative business for airlines, which typically generate revenue by selling points to credit card operators, hotels and shops. Airlines make a profit because they sell the points for more than it costs to redeem them. “This area is quite the holy grail for most individual airlines,” Goh said. But there’s room for frequent-flyer programs to mature, he said, without disclosing further details about the mooted card, including which financial institution will be a partner. While it’s common for airlines to offer loyalty programs as well as form partnerships with other airlines and merchants, a combined credit card with more than two dozen members will be a first for the industry. During the worst of Covid, loyalty programs were a lifeline for carriers, with BA owner IAG SA raising almost $1b by selling points to American Express. Others including Delta and United laid down their programs as security against billions of dollars of loans and bonds.<br/>
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Flight attendants are effectively forced to work for free amid growing tarmac delays - particularly at Toronto's Pearson airport - according to the employees' biggest union. The Canadian Union of Public Employees, which represents some 15,000 flight attendants, says the clogged airports and lengthy wait times that have plagued thousands of passengers in recent weeks are also extracting what amounts to unpaid labour from cabin crews. Flight attendants are typically compensated based on time in the air, so hours spent on the tarmac tending to frustrated travellers yields no extra wages in some cases, while other collective agreements allow for half pay. The problem, most acute at Canada's largest airport since late last month, plays out after planes land and then sit for up to three hours at the gate, said Wesley Lesosky, who heads CUPE's airline division. “They're actively doing water service, helping people. The cabins are getting hot, because obviously they're on the ground ... they can be tending to ensuring the aisles are clear, doorways are clear,” he said. “For Air Canada Rouge, there's zero pay, zero compensation for them. For Air Canada, it's a 50% credit if the service director claims it.” The on-the-ground work can be even more taxing - and occasionally abusive - than service in the sky, he added. “We've definitely seen a huge increase in irate customers, and just health and safety issues in general for cabin crew.” Time on board also eats into employee downtime between flights, potentially contravening contract provisions - a potential problem for airlines as well, said former Air Canada chief operating officer Duncan Dee, citing both collective agreements and aviation regulations.<br/>
Copa Airlines CEO Pedro Heilbron does not think the carrier needs to do anything differently following the announcement that Avianca and Gol plan to consolidate under a single holding company. “I won’t talk about whether we have to react or not,” Heilbron said during Copa’s Q1 earnings call on May 12. “If we choose to focus on our business model, I think we will be very successful doing it that way.” His comments come a day after Avianca and Gol announced they would merge under the new UK-based Abra Group. The merger is akin to the holding company approach to consolidation at European airlines, like the British Airways-Iberia merger that created International Airlines Group in 2011, with each airline continuing to operate independently under its own brand. Abra will also own Viva Air, and a minority stake in Sky Airline. Heilbron acknowledged that the creation of Abra does create something of a “spider web” of partnerships among Latin American airlines. Copa and Avianca are both members of the Star Alliance, and prior to the pandemic committed to forming an immunized joint venture with United Airlines covering flights to the US Copa has a separate codeshare agreement with Gol that has been in place since 2015. The creation of Abra will likely add “another twist” to Copa’s agreement to form a joint venture with Avianca and United, Heilbron said. “It’s hard for us to see right now what’s going to be the decision of [Abra] or the other partners. It’s up in the air right now but it’s still there.”<br/>
South Africa’s government has retained special voting rights in the country’s national carrier even after selling a majority stake, and will be given 3b rand ($186m) in preference shares that can be redeemed through future cashflow. That means the state stands to benefit should new owner, the Takatso Consortium, revive a carrier that’s struggled under years of heavy losses, corruption and mismanagement, according to a statement from the Department of Public Enterprises on Thursday. Takatso—made up of a local jet-leasing company and private-equity firm—will provide 3b rand in working capital and has valued SAA’s assets at about the same amount, the department said. The group agreed to take control of the airline almost a year ago for a notional sum of about $3, in return for spending commitments and responsibility for operations. “The 51 rand was a nominal sum set some time ago when SAA was not at all a going concern,” Public Enterprises Minister Pravin Gordhan said by phone. “While now it is still in the recovery phase, things are far better for government than it was when that price was set.” The details emerged after the National Treasury criticized the terms of the deal, saying SAA represents a “contingent liability” as the government may be liable for certain costs. The state will still be on the hook for outstanding “business rescue obligations” stemming from the company’s near 18-month bankruptcy proceedings, Takatso said. The government’s voting rights, knows as a golden share, will mean SAA can’t be sold on without its consent and the state will retain a stake of at least 33.3%, the DPE said. It will also have full voting rights over “matters of national interest.”<br/>
The CEO of Singapore Airlines’ budget unit is leaving to head Tata Group-owned Air India Ltd., taking on a role that a former Turkish Airlines chairman recently turned down after facing political opposition. Campbell Wilson, 50, will leave Scoot Tigerair Pte on June 16 and will be replaced by Leslie Thng, who was until recently the CEO of Vistara—an Indian joint venture between Tata and Singapore Airlines—the city-state’s flag carrier said Thursday. Air India’s board accepted the appointment, which is subject to requisite regulatory approval, the former state-run carrier said in a separate statement. Wilson is taking up a challenging job of turning around a once-popular, money-losing carrier, which has seen its market share slump as a slew of budget airlines started offering cheap, on-time flights. The salt-to-software conglomerate, Tata Group, was already burdened with majority stakes in two other airlines, Vistara and AirAsia India Ltd.—neither of which ever made money—before the purchase of Air India added a third airline brand to the group. Wilson “is an industry veteran having worked in key global markets cutting across multiple functions,” Natarajan Chandrasekaran, chairman of Air India, said in the statement. “Air India would benefit from his added experience of having built an airline brand in Asia.” The incoming CEO will also have to pare Air India’s debt of 153b rupees ($2b), modernize its fleet and rationalize its routes. Under government control, Air India was known for a highly-unionized workforce with a history of disrupting schedules for demands, and an aging and mixed fleet of more than 150 aircraft, which, potentially, further complicates Wilson’s job.<br/>