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Posted April 29, 2019

Airport

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Travelers flying to less mainstream destinations, or flying into smaller airports on budget airlines, often have a challenge getting directly to their destination. To ease this situation, and for other reasons, airlines have made interline or codeshare deals with each other. Interline deals allow airlines to book flights on other airlines, often in the case of operational problems that strand their customers; while codeshares are simply another airline’s flight marketed as one of their own.

These deals often don’t serve the budget traveler, though, since smaller airlines don’t tend to have them. Even big airlines, such as Delta and American, for example, can have a hard time hammering out a deal. But the demand remains, and travelers are the ones who take on the inconvenience, and the risk.

For a traveler flying from one small city in Europe to another, they may have to visit several different airline sites and book tickets on multiple airlines. This approach has several pitfalls. First, the traveler has to check in and check their bags at each leg of the journey. Second, if one flight is delayed or canceled, it puts the whole itinerary at risk – and the customer is the one who pays when later flights are missed.

Enter three innovative tech companies, who are offering some new options for the “self-connecting” traveler.

Kiwi is a Czech online travel agency that specializes in patching together the most affordable itinerary on multiple airlines – a service called “virtual interlining.” From a customer point of view, it’s easy to see at a glance where they can go on the budget they have in mind, and it’s easy to book a complete itinerary on multiple airlines. The downside: There’s still the issue of having to recheck baggage during each leg, though Kiwi has recently teamed up with Stansted Airport to make bag transfer seamless, and is pursuing partnerships with other airports. The upside: If a flight is changed, delayed, or canceled, Kiwi guarantees either an alternative flight or a refund for the cost of unused flights. They may also provide accommodations or dining vouchers in certain situations. 

Last December, Kiwi took a minority stake in Israel-based AeroCRS, which provides cloud-based airline reservations. With this new partnership, Kiwi is soon to begin providing its virtual interlining service directly to airlines. The airlines can then sell another airline’s route to their customers under one ticket. It’s a simpler model than traditional interlining agreements for the airline, and provides the airline’s customers with access to more destinations, without the risk.

Iceland-based metasearch company, Dohop, powers a virtual interlining initiative by easyJet called Worldwide. As opposed to Kiwi’s agency model, Dohop offers a more direct approach to virtual interlining. Customers select the flights they want and Dohop combines them into a single booking. Travelers then get a seamless travel experience between easyJet flights and long haul flights from airlines such as Emirates, Singapore Airlines and Virgin Atlantic.  Like Kiwi, Dohop also provides a connection guarantee. According to Dohop, they are in conversations with about 60 airlines about their model and already have active projects with 10 carriers around the globe.

Finally, Air Black Box powers the Value Alliance, comprised of seven Asia Pacific airlines who can now offer flights on each other’s airlines in what is being called the largest low-cost alliance in the world. The service, unlike others, also allows for the purchase of ancillaries. Last September, Air Block Box was purchased by investment firm 777 Partners with undisclosed terms. They’ll begin expanding their offerings to provide airports with the ability to link their baggage handling software to the Air Black Box system, enabling smoother baggage transfer for virtual interlining passengers.

Although still in its infancy, virtual interlining has a large potential for growth. Unlike the limited and often clunky interlining deals between airlines, tech companies are focusing on customer experience first and are actively pursuing the partnerships and technology needed to continue to tackle the existing challenges. As a recent IATA report recently said, “… by 2021, airline distribution will evolve from its current passive, rigid and technology-centric state to a more flexible, dynamic and passenger-centric environment ….” As in most areas of travel, customers are demanding more, and the companies that can deliver will the ones that get the business.


Cynthia Frebet

Cynthia Frebet

Part of the WEX team since 2014, Cynthia is responsible for taking care of some of our largest travel customers. With a background in B2B payments, Cynthia’s proactive approach and attention to detail helps ensure we surpass the expectations of our customers in meeting their business goals. Cynthia has a bachelor’s degree in Business Administration and Management from European Business School, Paris.


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