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Delta, Aeromexico to form exclusive alliance

By control on August 10, 2011

Delta and Aeromexico have announced plans for a long-term partnership, enabling both airlines to code-share and leverage each other’s strengths. Delta also will invest $65 million in the Mexican airline as part of the carriers’ MoU.

Delta CEO Richard Anderson points to the multiple benefits of this alliance. “Aeromexico has been a strong partner for Delta in Mexico and Latin America, and this reinforces our relationship,” he said in a statement. “By forming an exclusive long-term commercial partnership, we will… build the foundation for a joint venture to better serve the U.S. and Mexico marketplace.”

The timing of the agreement is also fortuitous. Trade between the North American nations is up significantly, reaching roughly $400 billion in 2010. In fact, Mexico ranks third among the U.S.’ trading partners, U.S. Dept. of Commerce officials stated.

Aeromexico is also having a good year in its own right, reporting its highest operating margin in 15 years for the quarter ending in June. To Jose Luis Barraza, chairman of Aeromexico’s board of directors, it’s a growth pattern that will only continue with Delta’s influence.

“The expanded relationship between Delta and Aeromexico comes at a key time in the history of Mexico’s domestic aviation,” Barraza said in a statement. “Our company now boasts the most modern fleet and the largest network in the country, serving over 60 destinations. The alliance with Delta will make history, and Grupo Aeromexico is proud to be a part of it.”

Delta and Aeromexico will also take their partnership one step further and expand their maintenance, repair and overhaul (MRO) agreement. As part of a separate announcement, the carriers will invest equal shares into the construction of a Mexican repair facility, which is scheduled to open in mid-to-late 2013. It will also be open to third-party carriers, Delta officials said.

“The MRO agreement will represent significant savings for our maintenance group while continuing the extremely high-quality work we receive from Aeromexico,” Delta President Ed Bastian stated. “The facility is a natural next step for the two airlines as we leverage the full benefits of our alliance.”

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