Delta and Aeromexico’s joint venture preserved after court order

The carriers argued the joint venture provides greater choice and connectivity for travelers.

Delta has been in a partnership with Aeromexico for almost 10 years. (Hyosub Shin/AJC)

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Last September, a government agency ordered Atlanta-based Delta Air Lines and its Mexican partner Aeromexico to dissolve a nearly 10-year-old joint venture allowing the carriers to coordinate scheduling, pricing and capacity for U.S.-Mexico flights.

Now, more than a year later, a U.S. appeals court overturned the Trump administration’s order following legal action from the two carriers.

The 11th Circuit Court of Appeals said the U.S. Department of Transportation did not reasonably explain why it conducted a far more limited market analysis in this case than it has done in the past, or why it imposed a requirement for approval of the joint venture that it did not require of similar joint ventures it approved between U.S. and Japanese airlines, according to a court order filed Thursday.

In a statement, a Delta spokesperson said the carrier appreciates “the 11th Circuit’s careful review and (we) remain focused on ensuring our customers, employees, and communities continue to benefit from this longstanding partnership.”

Aeromexico did not immediately respond to a request for comment.

The DOT approved the joint venture and granted it antitrust immunity in 2016. In March 2022, the carriers applied to renew the approval and antitrust immunity, reporting that the joint venture had increased U.S.-Mexico flight capacity by 761 seats per day and “significantly expanded capacity” on 26 city-pair routes, according to the court order.

The DOT proposed ending the joint venture in 2024, believing the competitive landscape worsened when the Mexican government restricted takeoff and landing slots and banned all-cargo carriers from operating at one Mexico City airport, according to the court order.

The U.S. government across the Biden and Trump administrations has alleged the government of Mexico has “repeatedly distorted competition in the market” in violation of the countries’ air transport agreement. These distortions, the DOT has argued, reduced the joint venture’s economic incentive of lower prices, better services and increased capacity on hub-to-hub routes providing additional seats for connecting markets. Aeromexico is Mexico’s flag carrier.

Delta and Aeromexico had warned that if their venture were terminated, up to two dozen routes could be canceled, some aircraft could be swapped to smaller models and “tens of thousands of jobs could be threatened.”

The carriers filed a petition in October with the appeals court to reverse the order.

As of 2024, the airlines operate 110 daily flights between Mexico and the U.S. across nearly 70 routes.