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Etihad’s financial woes continue to mount, as the Abu Dhabi-based carrier remained unprofitable in 2018 for the third year in a row, posting a $1.28 billion loss for the year. Rumors have been circulating for years that Etihad is on the verge of joining Star Alliance, increasing its reach and giving it access to profitable codeshare agreements around the globe. While Etihad currently partners with American Airlines for reciprocal mileage earning and redemptions, it is not a member of one of the major three alliances.

The rumors about Etihad and Star Alliance gained some traction this week, with One Mile at a Time reporting that Aeroplan, Air Canada’s independently run loyalty program, announced a new partnership with Etihad launching on May 1.

An Air Canada spokesperson quickly issued a clarification that the two were not, in fact, launching a partnership yet, but the specificity of the denial hints that something is under discussion.

Clearly our content team is excited about new earning opportunities for Aeroplan! While Air Canada is in discussions with Etihad Airways, we will not be launching a frequent flyer partnership tomorrow. We look forward to sharing more details with you as they become available.”

The rumored partnership, if true, would still be a few rungs below a full Star Alliance membership. Aeroplan members would be able to earn miles for travel on Etihad, though the earnings would be limited to redeemable miles and not elite qualifying miles for Air Canada elite status. Additionally, Star Alliance elite benefits would not apply for travel on Etihad Airways.

There’s also no mention of reciprocal mileage redemptions, which would be perhaps the most interesting and valuable element of any eventual partnership. Aeroplan and Etihad are both transfers partners of American Express Membership Rewards (1:1) and Capital One Miles (2:1.5), meaning that reciprocal mileage redemptions would allow you to pit the two award charts against each other to book award flights at the lowest possible rates.

Bottom Line

No, Etihad is not joining Star Alliance just yet. But if this rumored partnership with Air Canada comes to fruition, it will be an important first step for the struggling Gulf carrier. There are still plenty of unknowns at this point, including what the earning and redemption rates would look like, but Air Canada’s lack of a complete denial likely means that some partnership is in the works.

Featured photo courtesy of Shutterstock.com.

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