The U.S. Department of Transportation (USDOT) recently terminated approval of a Delta and Aeromexico joint venture agreement and withdrew antitrust immunity.
The department said Mexico has not taken meaningful action to remedy their noncompliance with the 2015 U.S.-Mexico Air Transport Agreement. Non-compliance provides an unfair advantage to Delta and Aeromexico who operated a price- and capacity-setting joint venture.
“Empty promises mean nothing,” U.S. Transportation Secretary Sean P. Duffy said. “After years of taking advantage of the U.S. and our carriers, we need to see definitive action by Mexico that levels the playing field and restores fairness,”
The joint venture must wind down by Jan. 1 and Delta and Aeromexico will be required to discontinue activities such as capacity management, common pricing and revenue sharing that require antitrust immunity. The airlines are permitted to continue activities such as marketing, frequent flyer cooperation, and codesharing, and Delta will retain its equity stake in Aeromexico.
Termination of the joint venture will not affect flights.
USDOT only supports antitrust immunity for joint venture agreements when foreign countries abide by fairness, free markets and competition, the agency said.
Mexico rescinded slots and forced U.S. all-cargo carriers to relocate operations in 2022, violating a bilateral agreement.