Appeals Court Upholds Delta-Aeromexico Joint Venture

A U.S. appeals court ruled Thursday in favor of Delta Air Lines and Aeromexico, allowing their immunized joint venture to continue operating after the Department of Transportation (DOT) attempted to terminate it starting in 2024.

Key Ruling

The Eleventh Circuit Court of Appeals determined the DOT’s decision focused solely on the Mexico City market, neglecting a broader U.S.-Mexico market analysis used when the pact was initially approved in 2016.

“The joint venture and its antitrust immunity remain in effect, allowing Aeromexico and Delta to continue providing enhanced connectivity, a broader network, more convenient service options and increased competition for customers traveling between Mexico and the United States,” Aeromexico stated in a release.

Delta added that the airline remains “focused on ensuring our customers, employees, and communities continue to benefit from this longstanding partnership.”

Joint Venture Details

A joint venture allows airlines to operate closely together, essentially as one carrier in a specific market, coordinating scheduling, pricing, and sales. This often leads to more flights and routes than would be possible independently.

Delta and Aeromexico’s joint venture covers the U.S.-Mexico market, which is the largest international market by seats from the U.S.

Historical Context

The partnership has expanded significantly since implementation a decade ago, adding dozens of new routes, including from Mexico City to Phoenix, Raleigh-Durham, and Tampa. Previously, the alliance faced challenges due to a Federal Aviation Administration downgrade of Mexico’s safety rating in 2021-2023, which led to a suspension of codeshare and coordination with Aeromexico. Mexico was subsequently upgraded to a Category 1 rating in 2023, allowing the partnership to resume.