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Delta and LATAM win final approval for joint venture; frequent flyer enhancements expected

Sept. 30, 2022
3 min read
Delta and LATAM win final approval for joint venture; frequent flyer enhancements expected
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Look for Delta to soon offer an enhanced relationship with its South American partner, LATAM.

The U.S. Department of Transportation granted final approval on Friday to the Atlanta-based carrier's joint venture with its South American partner, LATAM. LATAM has operations focused in Chile, Brazil and a number of other countries on the continent.

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With the new partnership, Delta and LATAM will split revenue on flights between the U.S. and Canada and South America. The deal comes with antitrust immunity, meaning that the two airlines will be allowed to coordinate on schedules and fares in those markets.

“Delta’s partnership with LATAM will help grow the market between North and South America and provide significant and much-needed benefits for customers, and we applaud the DOT for this final approval,” Delta CEO Ed Bastian said in a statement. “Now, we’ll get to work with LATAM to transform the travel experience for our collective customers and create new opportunities for our employees.”

Friday's news is not a surprise; DOT had granted tentative approval to the deal in June, and there was very little that could have derailed the deal since then.

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More: Delta and LATAM's joint venture is tentatively approved by DOT

Still, Delta's pilot union had raised questions about one section of the joint venture agreement that was removed, that dealt with the proportion of new flying that Delta would be able to add. In its decision, the DOT disagreed with the union, the Air Line Pilots Association, and said that an increased amount of flying from LATAM would indirectly add more Delta flying, too.

Friday's news culminates a process that began nearly three years to the day. In September 2019, LATAM shocked the airline world by ditching its U.S. partner American Airlines and leaving the Oneworld alliance in order to partner with Delta. For its part, Delta purchased a 20% stake in the airline, which it recommitted to during the COVID-19 pandemic, despite LATAM's bankruptcy under Chapter 11 of the U.S. bankruptcy code. LATAM is expected to exit Chapter 11 later this year.

Already, Delta and LATAM passengers can take advantage of a codeshare, as well as reciprocal frequent-flyer program benefits. Delta promises more enhancements from the JV in the months to come.

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