In 2010 and 2011, American Airlines went into overdrive on the international partnership scene; not content with the ties of its Oneworld global alliance and its code-sharing partnerships, it went a step further and formed joint business ventures in the transatlantic market with British Airways/Iberia, and across the Pacific with Japan Airlines to Japan and with Qantas to Australia/New Zealand. Its leading competitors, United and Delta, did the same with other foreign partners.
Things have quieted down since then, but now American — a much larger company following its merger with US Airways — has targeted a new partner for what it calls a Joint Business (JB) operation: South America‘s LATAM Airlines group.
LATAM’s principal carriers — Brazil’s TAM and Chile-based LAN, which merged in 2012 to form the LATAM holding company — are already members of Oneworld. But under the stronger bonds of a joint business venture — if it is approved by U.S. and Latin American government authorities — American and its LATAM partners can coordinate schedules, routes and pricing without fear of running afoul of antitrust laws.
As usual, American is touting what it says will be big benefits for its customers under a Joint Business arrangement, including greater market access to more destinations with more flight frequencies, “more competitive fares,” and seamless connections between airlines.
American said its customers will gain “enhanced network connectivity to cities in South America” through LATAM hubs in Sao Paulo and Brasilia, Brazil; Santiago, Chile; Lima, Peru; and Bogota, Colombia. The carrier also said that the LATAM venture “will create opportunities for new direct service to currently underserved destinations and additional frequencies on existing routes.”
LAN and TAM and their subsidiaries serve 140 cities in 24 countries, with a total fleet of 318 aircraft. In addition to the American deal, LATAM has simultaneously applied for approval of a transatlaqntic joint venture with AA’s International Airlines Group partners, British Airways and Iberia.
Readers: Have you flown on LAN or TAM? Do you think they’ll make good Joint Business partners for American?
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