Brazilian government clears Delta-LATAM JV

The airlines are still seeking US government approval for the full JV.

Delta Air Lines and LATAM Airlines Group have been granted approval by Brazil’s competition authority, the Administrative Council for Economic Defense (CADE), to launch a North-South America joint venture (JV), clearing a key regulatory hurdle.

The proposed JV is still awaiting antitrust clearance from the US government. The US Department of Transportation (DOT) has given the green light for the airlines to operate codeshare routes between the US and Chile. 

Delta and LATAM said in a joint statement that the CADE approved antitrust immunity for flights between the US and Brazil “without conditions, following an evaluation of free competition considerations and taking into account the unprecedented economic impact of COVID-19 on the airline industry.”

Delta CEO Ed Bastian commented: “This marks an important step in the approval process for our joint venture with LATAM, which will provide customers with the best experience and partner network in the Americas.

“Just as Delta is committing significant resources to ensure customers feel confident when they travel, we remain equally committed to bringing customers all of the benefits our partnership with LATAM will offer.”

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LATAM CEO Roberto Alvo added: “The CADE’s approval in just two months is testament to the joint venture’s benefits for customers and for Brazil, marking another important step towards offering customers exceptional connectivity in the Americas. We are confident that these same benefits will be recognized by competition authorities in other countries.”

The two carriers are already sharing terminals at hub airports and give passengers mutual access to 35 Delta Sky Club lounges in the US and five LATAM VIP lounges in South America.

Delta completed its acquisition of a 20% stake in LATAM in late December 2019. In advance of the metal-neutral JV, codesharing has already started between Delta and LATAM’s affiliates in Chile, Colombia, Ecuador and Peru. Prior to the COVID-19 outbreak, the airlines said the JV would provide passengers increased connectivity on up to 74 onward routes in the US and up to 51 onward routes in South America.

Photo credit: Joe Pries