The United States government has ordered Delta Airlines and Aeromexico to end their joint venture by 1 January, after Mexico cut commercial flight slots at Mexico City’s main airport in 2023.
Under the nine-year partnership, Delta and Aeromexico coordinated prices and schedules for flights between the U.S. and Mexico. The U.S. Department of Transportation said in July that it was considering withdrawing the joint venture’s antitrust immunity, which would end the partnership.
“This action is necessary because of ongoing anticompetitive effects in U.S.-Mexico City markets that provide an unfair advantage to Delta and Aeromexico as two predominant competitors and create unacceptable actual and potential harm for stakeholders, including consumers,” the Department of Transportation said in a filing.
“We are disappointed that the Department of Transportation has chosen to terminate its approval of the strategic and pro-competitive partnership between Delta and Aeromexico, a decision that will cause significant harm to U.S. jobs, communities and consumers traveling between the U.S. and Mexico,” wrote Delta.
Delta and Aeromexico will continue to offer frequent flyer program reciprocity, Aeromexico said. Delta has a 20% equity stake in Aeromexico.
Mexico’s government cut commercial flight slots at Mexico City International Airport during 2023. It also moved cargo flights to the newly-built Felipe Angeles International Airport, which is significantly further from central Mexico City.
This was a bid to lower congestion at the city’s main airport, Mexico’s government said in July.
Delta and Aeromexico have also had a codesharing agreement under an antitrust exemption, though the U.S. said in January 2024 that it would not renew the exemption after the Mexico City flight overhaul.
At the time, the Department of Transportation had tentatively given the airlines an October 2024 deadline to end their joint venture.
Delta Air Lines’ (NYSE: DAL) share price closed at US$57.86, down 1% from its previous close at $58.42. Its market capitalisation is $37.78 billion.
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