Codeshare agreement

Code sharing is a business term which was first originated in the airline industry in 1990 when the Australian airline, Qantas Airways and the U.S.‘s American Airlines combined services between an array of U.S. domestic cities and Australian cities. The code share was part of a “cooperative services” agreement between the two carriers before the various airline alliances were formed. It refers to a practice where a flight operated by an airline is jointly marketed as a flight for one or more other airlines. Most major airlines today have code sharing partnerships with other airlines, and code sharing is a key feature of the major airline alliances.

The term “code” refers to the identifier used in flight schedule, generally the 2-character IATA airline designator code and flight number. Thus, XX123, flight 123 operated by the airline XX, might also be sold by airline YY as YY456 and by ZZ as ZZ9876.

Under a code sharing agreement participating airlines can present a common flight number for several reasons, including:

Connecting flights – This provides clearer routing for the customer, allowing a customer to book travel from point A to C through point B under one carrier’s code, instead of a customer booking from point A to B under one code, and from point B to C under another code. This is not only a superficial addition as cooperating airlines also strive to synchronize their schedules and coordinate luggage handling, which makes transfers between connecting flights less time-consuming.
Flights from both airlines that fly the same route – This provides an apparent increase in the frequency of service on the route by one airline
Perceived service to unserved markets – This provides a method for carriers who do not operate their own aircraft on a given route to gain exposure in the market through display of their flight numbers.

Under a code sharing agreement, the airline that actually operates the flight (the one providing the plane, the crew and the ground handling services) is called the operating carrier. The company or companies that sell tickets for that flight but do not actually operate it are called marketing carriers or validating carriers.

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Codeshare agreement

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