American Airlines announces major new partnership with South American ULCC JetSmart
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
American Airlines is doubling down on South America — and moving past a pre-pandemic breakup.
The U.S. carrier on Tuesday announced a partnership with South American ultra low-cost carrier JetSmart (branded as JetSMART).
JetSmart, which was founded in 2016, operates primarily out of bases in Chile and Argentina. The airline has a fleet of 20 Airbus A320ceo and A320neo aircraft, with 79 more pending deliveries. It flies short-haul routes throughout the two countries, as well as to destinations in Brazil, Uruguay, Peru and Colombia.
Want more airline-specific news? Sign up for TPG’s free new biweekly Aviation newsletter!
It’s owned by Indigo Partners, the private equity firm that owns a range of ULCCs including Frontier Airlines in the U.S., Wizz Air in Europe, Volaris in Mexico and Cebu Pacific in the Philippines, among others.
Under the partnership, the two airlines will codeshare, and American Airlines AAdvantage members will be able to earn and redeem miles on JetSmart. American will purchase a minority ownership stake in the ULCC, and American and Indigo will “jointly commit to provide additional capital to fund potential future opportunities in the region,” the airlines said in a statement.
American operates flights to 17 cities in South America, while JetSmart currently services 33 cities. The airlines will offer connections in Cali, Medellin and Bogota, Colombia; Lima, Peru; Buenos Aires, Argentina; and Santiago, Chile.
The partnership comes alongside American’s existing codeshare agreement with Brazilian carrier GOL.
Together, the two codeshare agreements help make up for American Airlines’ still-stinging 2019 loss of its codeshare with Latam, which is the South American airline stemming from the 2012 merger of Chilean flag carrier Lan and Brazilian airline Tam.
In 2019, Delta Air Lines announced its own partnership with and ownership stake in Latam, effectively stealing the carrier away from American Airlines and its other Oneworld partners.
Still, American said, the impetus for the new partnership is to expand service for its customers based on current opportunities — not to make up for the pre-pandemic Latam breakup.
“What’s unique is what JetSmart brings to the American Airlines network,” Vasu Raja, American’s chief revenue officer, said in a media briefing.
“For a long time, American Airlines has been the largest long-haul carrier into South America,” Raja added. “We’ve continued to bolster the network and we have plans coming out of here to be able to continue to grow in South America and grow, really, quite aggressively.”
It was not clear when the alliance would fully take effect, however. Raja said that the airlines anticipate introducing the codeshare “as quickly as we can,” but that the integration of the AAdvantage program could take longer.
“We want to be really thoughtful about how we roll out an entirety of benefits to the customers that preserves the integrity of these business models and fulfills our purpose behind the deal,” he said.
Notably, Raja said, the partnership will help American appeal to potential customers who are visiting the U.S.
“As many as 65% of our customer base on these routes originates in South America,” Raja said.
While American Airlines would prefer to be viewed as a mainline, premium carrier — on par with Delta and United, even if those competitors are more deliberately trying to appeal to customers as “premium” — Raja said he was not concerned that allying with a ULCC could hurt perceptions of the U.S. carrier.
“Don’t be fooled by the name,” Raja said of the ULCC moniker, referring to airlines based in non-U.S. markets around the globe. “The quality of product that ULCCs are offering, especially this ULCC, JetSmart is not just competitive with more traditional network competitors in the area — it’s very often superior.”
“These are new airplanes with modern seats and a great schedule and travel pattern for either a connecting passenger or especially a nonstop passenger,” he added. “So ULCC notwithstanding, this is a product which certainly we’d be very proud to put our customers on, otherwise we wouldn’t be engaging in a partnership such as this.”
Featured image courtesy of American Airlines.
Welcome to The Points Guy!
Earn 90,000 bonus miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new card in the first three months of card membership. Offer ends 11/10/2021.
With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.
- Limited Time Offer: Earn 90,000 Bonus Miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new Card in your first 3 months. Offer expires 11/10/2021.
- Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
- Earn 3X Miles on Delta purchases and purchases made directly with hotels.
- Earn 2X Miles at restaurants worldwide, including takeout and delivery and at U.S. supermarkets.
- Earn 1X Miles on all other eligible purchases.
- Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. *Payment of the government imposed taxes and fees of no more than $75 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
- Enjoy your first checked bag free on Delta flights.
- Fee Credit for Global Entry or TSA Pre✓®.
- Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees