Due to Mexican government intervention, the United States rejects the Aeromexico-Delta Joint Venture

In a recent setback for the U.S.-Mexico cross-border aviation market, the U.S. Department of Transportation (DoT) announced on January 26 its rejection of the proposed joint venture between Aeromexico and Delta Air Lines.

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This decision follows the Mexican government’s reduction of slots at the congested Mexico City International Airport (AICM) from 52 to 43 operations per hour. This measure contrasts sharply with the previously stated official capacity of 61 operations per hour.

The Mexican government’s actions are aimed at diverting air traffic to the new Felipe Angeles International Airport (AIFA), located 50 kilometers from the capital. However, this initiative faces opposition from Mexican and U.S. authorities, as well as U.S. industry and transportation groups.

Currently, President López Obrador’s directive is demanding that all cargo airlines operate at AIFA, as well as new destinations, frequencies and airlines. Such actions also disrupted the Allegiant and Viva Aerobus joint venture last year.

According to the DOT, these actions negatively affect existing operators and discourage potential new entrants. The DOT has consistently expressed dissatisfaction with slot allocation at the airport.

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The final decision is pending, and the department indicates that the companies tentatively have until October 26, 2024, to conclude their joint venture.

Cross-border growth cut short by USDOT

Aeromexico and Delta Air Lines maintained a Joint Cooperation Agreement (JCA) since the USDOT granted them antitrust immunity in 2016. This immunity allows the airlines to sell seats on each other’s flights through a codeshare agreement.

Under this agreement, Delta and Aeromexico had plans to offer more than 90 daily flights between the two countries this year, both airlines announced.

See also: Delta and Aeromexico to increase cross-border capacity by more than 30% by 2024

Aeromexico revealed that it is currently analyzing the DOT’s resolution and will present arguments jointly to address the concerns raised by the authority.

In a press release, Aeromexico stated that «Aeromexico informs that it is analyzing the resolution dated January 26, 2024, issued by the U.S. Department of Transportation (DOT), through which it issues a draft decision on the request to renew the granting of antitrust immunity (ATI)».

Aeromexico explained that «the USDOT required interested parties to present arguments, so the airlines will jointly and timely present arguments that will allow the authority to issue a final determination,» the airline concluded.