The U.S. Department of Transportation (DOT) recently issued a tentative decision to terminate the joint venture between Delta and Aeromexico, giving both airlines until February 23 to submit objections. This decision has sparked a heated dispute, with Delta arguing that the proposal is not only detrimental to the airlines involved but also harmful to the U.S. economy, local communities, transborder competition, and overall aviation interests.
Delta and Aeromexico contend that the termination of their joint venture alliance would result in route reductions and decreased frequencies for transborder operations. The DOT’s tentative order issued on January 26 denied their request for an extension of antitrust immunity. Antitrust immunity enables the two carriers to jointly schedule, market, and operate flights between the United States and Mexico.
However, the DOT’s decision to terminate the antitrust immunity stems from Mexico’s recent actions, including the prohibition of cargo services at Benito Juarez International Airport in Mexico City and capacity reductions on commercial service at the airport. These measures were implemented by Mexico president Andres Manuel Lopez Obrador to redirect services to the newly established Felipe Angeles Airport, controlled by the military. According to the DOT, this violates the air transport agreement between the U.S. and Mexico, which is a crucial requirement for any U.S.-Mexican airline partnership to receive antitrust immunity.
Delta and Aeromexico had initially asked for an extension until March 9 to respond to the DOT’s order. However, the DOT decided to grant an extended response time until February 23, which exceeds the original deadline by two weeks. In addition, Delta calls upon the Biden administration to adopt a more procedural approach, continuing consultations with Mexico and exploring the possibility of arbitration if the dispute remains unresolved.
Apart from the desired procedural approach, Delta urges the DOT to consider taking actions specifically aimed at penalizing Mexico and its airlines. This could potentially include restrictions on the operations of Mexican airlines to and from the United States. Delta argues that such measures are necessary to address the violation of the air transport agreement and to safeguard the interests of U.S. aviation.
Delta and Aeromexico are challenging the DOT’s tentative decision to terminate their joint venture alliance. They highlight the adverse consequences it poses for both airlines and emphasize its detrimental impact on the U.S. economy, local communities, transborder competition, and U.S. aviation interests. The outcome of this dispute will likely have significant implications for the future of airline partnerships and the aviation industry as a whole.
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