Tae Hoon Oum
Key Aspects of Global Strategic Alliances and the Impacts on the Future of Air Canada 
and other Canadian Air Carriers

The report summarizes key features of and recent developments in global strategic airline 
alliances and investigates the potential roles of Air Canada and other Canadian carriers in 
increasingly powerful alliance networks. Using an econometric analysis of data on 22 
international airlines in the period 1986-1995, the study examines the effects of alliances on productivity, pricing and profitability of partner carriers, along with the effects of strategic alliances on partners' output, frequency of service, market outcome and consumer welfare. Using case studies, it also examines the effects of global alliance networks on intercontinental and North American traffic routing patterns. Anticipated roles of Air Canada and other Canadian carriers in North America and in the global alliance networks are described. Regulatory issues concerning alliances are discussed, with several pro-competitive recommendations offered.