SkyTeam members Air France-KLM and Delta Air Lines said their transatlantic joint venture (JV) with UK long-haul carrier Virgin Atlantic will take effect from Feb. 13, bringing together a network of 110 nonstop routes.
The partners said the newly expanded JV spans 23% of all transatlantic capacity, covering both passenger and cargo flights, with combined annual revenue of $13 billion.
It builds on the transatlantic JV formed by Air France-KLM and Delta in 2009, extending that partnership to include Virgin Atlantic, which has had a separate transatlantic cooperation with shareholder Delta since 2013.
“Today’s launch brings our historic, longstanding collaboration to a new level,” Delta CEO Ed Bastian said, announcing the formal launch of the new JV on Feb. 3.
Air France-KLM Group CEO Benjamin Smith said that the JV combines the four airlines’ networks, reinforcing their presence across the Atlantic.
The partners already rolled out some initial codeshares between Air France, KLM and Virgin Atlantic in 2019, but the JV will span up to 341 peak daily transatlantic services from Feb. 13, including the top 10 routes on a nonstop basis. It also includes onward connections to 238 cities in North America, 98 in continental Europe and 16 in the UK.
“The enhanced network is also fully available to cargo customers and is built around the carriers’ hubs in Amsterdam, Atlanta, Boston, Detroit, London Heathrow, Los Angeles, Minneapolis, New York-JFK, Paris, Seattle and Salt Lake City. It creates convenient nonstop or one-stop connections to every corner of North America, Europe and the UK,” the partners said.
In 2017, Air France-KLM, Delta and Virgin announced plans for Air France-KLM to acquire 31% of Virgin and for Delta to take a 10% stake in Air France-KLM, laying the foundations for the new transatlantic JV, however this plan changed in late 2019.
“The customer benefits of the joint venture are unaffected by the recent confirmation that Air France-KLM will no longer buy a 31% stake in Virgin Atlantic. Virgin Group will retain its 51% majority stake in Virgin Atlantic, with Delta continuing to hold 49%,” the partners said.
Governance of the JV will be “equally shared” between Air France-KLM Group, Delta and Virgin Atlantic. Future strategy will be defined by an executive committee, made up of the three company CEOs, and a management committee with representatives from various departments across the airlines.
From a strategic standpoint, the JV draws Virgin closer to the SkyTeam alliance. It also enables the partners to better-compete against two transatlantic JVs, made up from members of rival alliances oneworld and Star Alliance.
Photo Credit: Virgin Atlantic