Whilst there are many issues in the world at the moment, the business of aviation continues – with Delta Air Lines and LATAM Airlines Group (along with its affiliates) signing a trans-American Joint Venture Agreement.
Once regulatory approvals are granted, this will allow the two carriers to combine their route networks between North and South America. The joint venture has come about in part by Delta investing and taking 20% ownership of the group. On top of this, they are promoting
- Expanding codeshares between the two airlines
- Extending frequent flyer benefits (with Reciprocal top tier loyalty recognition is expected to be available during June 2020). Delta SkyMiles members can earn and use miles on LATAM flights, while LATAM Pass members can earn and use miles on Delta flights across their respective networks
- Lounge access sharing agreements (currently LATAM passengers can use SkyClubs at New York-JFK, Delta passengers can use the LATAM lounge in Bogotá), with further lounge sharing agreements to be confirmed in June
- Hub Co-location – LATAM have moved to New York-JFK T4, whilst Delta has moved to Terminal 3 at São Paulo’s Guarulhos Airport
Delta CEO Ed Bastian said
“Late last year, we set out to build the leading strategic alliance in Latin America together with LATAM, and while the industry landscape has changed, our commitment to this joint venture is as strong as ever,”
“Even as our carriers contend with the impact of COVID-19 on our business and take steps to protect the safety of our customers and employees, we are also building the airline alliance we know they’ll want to fly in the future.”
Roberto Alvo, CEO, LATAM Airlines Group said
“While we remain focused on navigating the COVID-19 crisis and protecting the safety and well-being of our passengers and employees, we also have to look to the future to ensure the best possible customer experience and support the long-term sustainability of the group,”
“Our bilateral strategic alliance with Delta remains a priority and we firmly believe that it still promises to offer customers the leading travel experience and connectivity in the Americas.”
Joint Ventures continue to be the way forward
With LATAM leaving oneworld, it has chosen a different path – rather than jumping straight into bed with SkyTeam, it’s chosen to go down the path of Joint Venture agreements, as well as codeshares that suit the airline best.
Whilst alliances are an important part of the connection jigsaw, Joint Venture agreements allow closer coordination, and in some cases, revenue sharing risk.
For LATAM, this is the path they seemingly are going down to explore.
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