Delta Air Lines (NYSE: DAL) and LATAM Airlines Group (NYSE: LTM) moved a step closer to integrating operations with the signing Thursday of an agreement outlining how they will implement their joint venture agreement struck last September.
The airlines are anticipating U.S. and Chilean competition authorities will grant permission to coordinate in all areas of their business later this year. Shippers could benefit from the arrangement as much as passengers because of the combined reach of their networks, LATAM’s dedicated freighter fleet and greater efficiencies.
Delta is investing $2.25 billion for a 20% stake in LATAM, the dominant carrier in South America, and in February they launched their first code-sharing flights for Colombia, Ecuador and Peru. The collaboration on cross-selling passenger bookings was the first major step in aligning operations. With code-sharing, each airline can market flights operated by the other carrier on its own schedule, making it easier for passengers to find and schedule connections and earn miles.
The airlines earlier this year also began offering reciprocal mileage benefits to frequent flyer members. And in early March, Delta co-located its operations with LATAM’s hub at São Paulo’s Guarulhos International Airport.
Both companies said their commitment to the joint venture has not wavered despite the changes wrought on the airline industry by the coronavirus pandemic.
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