The creation of the world¡¯s biggest alliance of low-cost airlines may signal that some of Asia¡¯s struggling budget carriers are headed for the altar.
The Value Alliance, announced Monday, stretches from Japan to Australia and includes Singapore Airlines Ltd.¡¯s Scoot and Nok Airlines PCL in Thailand. The aim is to sell tickets or even baggage allowance and in-flight meals across the group¡¯s eight airlines in a single transaction.
After years of cut-throat competition and financial losses, the coalition may be moving away from the typical budget model, which shuns the cost of international alliances and frequent-flier freebies. The union ¡ª unlike cut-rate competition in Europe and the U.S. ¡ª could be a step toward mergers in Asia, where low-cost carriers have flooded the world¡¯s fastest-growing travel market with plane orders, an analyst said.
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