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Last month, I wrote about how the US Department of Transportation (DOT) decided not to renew the joint venture agreement between Delta Air Lines and Aeromexico. They have held antitrust immunity since 2016, which means that they could coordinate things like pricing and schedules on transborder flights. Both carriers are requesting that this be reconsidered, but if it stands there could be a loss of almost 4% of the airline seats between the United States and Mexico.
Delta Air Lines and Aeromexico are both members of the SkyTeam Alliance. The two carriers will still be able to remain in the same alliance and offer frequent flier benefits, but they won’t be able to coordinate fares or schedules after October 26th. This is happening because the DOT is saying that the process that the government of Mexico uses to award slots at Mexico City’s Benito Juárez International Airport (MEX) is not clear and anticompetitive. It claims that Aeromexico has been able to hold onto its slots while not fully utilizing them in order to keep other carriers away.
The two airlines are planning to run around 90 daily transborder flights on about 60 routes. If the agreement stays cancelled then 21 routes between the United States and Mexico are at risk. A further 1,062 one-stop itineraries on 831 different routes would also be placed in jeopardy.
SimpleFlying is reporting that when it comes to cuts, Hartsfield-Jackson Atlanta International Airport (ATL) would see the most losses. Guadalajara International Airport (GDL), Guanajuato International Airport (BJX), Mérida International Airport (MID), Monterrey International Airport (MTY), and Querétaro International Airport (QRO) could all be cut. Three of these routes are only served by Delta.
Further cuts would hit Mexico City’s Benito Juárez International Airport (MEX). It is set to lose several routes where it is the only carrier including Boston Logan International Airport (BOS), Minneapolis–Saint Paul International Airport (MSP), Raleigh-Durham International Airport (RDU) (service is set to begin in July), and Seattle-Tacoma International Airport (SEA).
Detroit Metropolitan Wayne County Airport (DTW) would see Guadalajara International Airport (GDL), Guanajuato International Airport (BJX), Monterrey International Airport (MTY), and Querétaro International Airport (QRO) all get the axe and frequency reduce by one flight to Mexico City’s Benito Juárez International Airport (MEX). Salt Lake City International Airport (SLC) to Guadalajara International Airport (GDL) and Monterrey International Airport (MTY) get cut while two of three daily departures to Mexico City’s Benito Juárez International Airport (MEX) would also be at risk.
Frequencies from New York John F Kennedy International Airport (JFK) and Los Angeles International Airport (LAX) to Benito Juárez International Airport (MEX) and Monterrey International Airport (MTY) have also been labeled unsustainable without this partnership. Monterrey International Airport (MTY) is a hub for Aeromexico and it’s the only airline flying from there to New York and Los Angeles. Ten other frequencies across seven routes could also see cuts.
Delta and Aeromexico are seeking to have this reinstated and they’re getting some unlikely support from a pair of low-cost carriers. Allegiant Air and Viva Aerobus have filed a motion defending the partnership and urging the Department of Transportation (DOT) to allow them to proceed with their own joint venture proposal.
Anthony’s Take: The loss of this joint venture is a blow to both Delta and Aeromexico. Hopefully, the DOT decides to reverse course and we won’t see all of these cuts.
(Image Credits: Delta Air Lines and Aeromexico.)
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3 comments
What is needed is a transparent, fair, unbiased, and competitive slot allocation policy at MEX. Clearly there has been abuse of the JVA. USDOT is right to terminate it. There is way too much crying here about loss of capacity. The marketplace will adjust and supply what is needed, e.g through upgauging.
If the DOJ wants to look into anti competitive joint ventures, look no further than AA and BA to London and AA and JL to Tokyo or Delta with KE or the AF/KL/VS JV. It just seems like the government is going after small potatoes rather than the tieups that really hurt a lot of consumers.
16 Routes Between Mexico and the US Could be Cancelled
Everyone is walking over. No visa required.