What makes the Air France-KLM model so exceptional?

Under their mutual agreement, a holding company was set up by Air France and KLM. However, both carriers were allowed to continue operating independently, keeping their own logos, trademarks and brands, as well as their own management jurisdiction, resource distribution and staffing.

Industrial insiders are of the opinion that it was wise for the carriers to keep their own logos, trademarks and brands, because for a corporate entity, to relinquish the brand and image it has built up with so much effort over the decades is comparable to the act of suicide.

It has been proven that over the subsequent three years following the integration, both Air France and KLM have enjoyed an apparent edge in terms of route complementation, price management and fleet acquisition. And this has put the group a notch above its peers in the global aviation market--reigning supreme in Europe, second in North America, and an impressive 12%-13% market share in Asia.

The merger has also spawned a win-win situation as Air France and KLM have since launched the "combo ticket" package which allows their passengers to enjoy unbeatable air fares.

The successful merger between Air France and KLM has offered a major insight for aviation operators worldwide.

We should take note of what Air France-KLM board chairman CEO Jean-Cyril Spinetta once said: merger and equity participation are only a beginning, the crucial factor to the new entity's success lies very much in how it will move forward from here, and how the corporate cultures, management philosophies, service networks and passenger resources of individual carriers should be integrated in the future.