Agreement with rival Star Alliance likely to be scrapped in share swap changes The oneworld alliance, whose membership now looks likely to include Air China, generated sales of more than US$1.8 billion from interlining agreements last year as members took greater advantage of feeding passengers into each other's route networks. Air China last month signed a memorandum of understanding (MOU) with the rival Star Alliance. But with trading suspended yesterday pending an announcement of a share swap with Cathay Pacific Airways, the provisional deal is now likely to be rescinded in favour of a oneworld membership. Senior oneworld executives did not rule out such a move yesterday in Paris. 'We feel under no pressure in terms of time to sign a mainland carrier. It is as much finding a match for us as it is finding a carrier in the region,' John McCulloch, a managing partner in oneworld said before trading was suspended yesterday. 'You will see a lot more happen yet before it is all settled. I would be surprised if the [Air China] MOU was rescinded in any way. But stranger things have happened.' The alliance said it would like to see its interlining revenue, which rose 10.7 per cent year on year, grow 20 to 30 per cent a year until the end of the decade. Revenue from alliance 'fairs and sales activities' rose 20 per cent to US$650 million, the alliance said. Members reckoned they had saved an aggregate US$250 million through co-operative actions such as joint fuel purchasing, sharing airport facilities and engineering and maintenance work. 'To be frank, we have found [co-operating on cost reduction] much more difficult than in the area of finding revenue,' Mr McCulloch said. 'Nevertheless, it was still a landmark for oneworld. We are making big head roads in engineering and maintenance.' Members spend US$5 billion a year in engineering maintenance, excluding manpower. It was the only alliance to turn a profit last year, with its members posting aggregate earnings of US$1.8 billion. American Airlines was its only member to finish in the red, posting a loss of US$861 million. But that may all change next year with Malev and Japan Airlines also joining the alliance; the pair combined to lose US$427 million last year. Royal Jordanian will also join oneworld, the only alliance without a mainland partner. But that is expected to change after all five of Dragonair's shareholders suspended trading of their shares yesterday. The profitability of oneworld's members has given room for a relaxed approach towards securing a mainland partner, despite the obvious potential of the market. '[Finding a China partner] is important but it is not going to be life-threatening for Qantas or any other of the airlines. I don't regard it as an urgent issue at all,' Qantas chief executive Geoff Dixon said yesterday. 'I'm very relaxed about where the Chinese carriers go. The big game in China is going to be years off yet.' With Shanghai Airlines and Air China both throwing their lot in with Star last month - and China Southern to join the Skyteam alliance this month - the market had aligned oneworld with China Eastern, the country's last unattached major carrier. But members insisted before trading was suspended yesterday that they were still talking with multiple potential mainland partners. 'It is not a case of membership for membership sake,' British Airways chief executive Willie Walsh said. 'That is the difference between what oneworld has done and what some of the other airlines have done. For an alliance to have any credibility, the individual members have to be performing well.'