Another investment by Delta: The US airline joins Latam. The South American airline will subsequently leave the Oneworld alliance.
Originally, Latam had chosen American Airlines. The two airlines and members of the Oneworld alliance planned a joint venture for flights between the United States and South America. But in May a court in Chile banned the cooperation because it would handicap competition.
Latam ran over the books and soon flirted with another US airline. As Delta Air Lines announced on Thursday (September 26th), the two airlines are now planning to work closely together. They refer to the mutually complementary route networks that both airlines offer. They have not yet announced any concrete measures, but it is sensible to coordinate flight schedules, codeshare flights and tighten the links between frequent flyer programs.
Latam to leave Oneworld
To solidify the partnership, Delta acquires 20 percent of Latam for approximately $1.9 billion. The airline is also investing 350 million in the joint venture and taking delivery of 14 Airbus A350 aircraft. In return, the Americans will receive a seat on Latam’s supervisory board. Interestingly enough, Qatar Airways also has a stake of around 10 percent in the largest South American airline.
The Oneworld alliance announced that Latam had informed them of their intention to cooperate with a non-member airline and thus to leave the alliance «in due course.» «We are disappointed, but we respect their decision,» Oneworld said. «We wish Latam all the best for the future.»
Delta pulls back from Gol
Meanwhile, according to the financial news channel CNBC, Delta will sell its 9% stake in the Brazilian airline Gol. Delta currently has a global investment portfolio. In North America, the airline holds 49 percent of Aeromexico and 17 percent of Republic Airways. In Europe, it holds 49 percent of Virgin Atlantic and 10 percent of Air France-KLM. In Asia, the Americans now own 4.3 percent of Korean Air and, for some time now, 3 percent of China Eastern. Together with the Italian state railway, Delta is also involved with Alitalia.