There are signs that American Airlines is not taking the transformation of the airline landscape underway in Latin America so well.
Background:
1°) American Airlines is a partner of LATAM (Chile) within the Oneworld alliance, is the leading American airline in South and Latin America and is working on a “reinforced” partnership with the Chilean airline. Besides, LATAM is the biggest airline in the South American sub-continent.
2°) Delta Airlines has announced that it is taking a 20% stake in LATAM as part of its new strategy of favouring capital partnerships over alliances.
3°) At the same time, LATAM announced that it was leaving Oneworld, without joining Skyteam.
An announcement that takes everyone by surprise
Let’s face it, the announcement caught everyone by surprise and will reshuffle the deck in several ways.
1°) Allow Delta to tickle American on its own turf.
2°) To decrease the influence of OneWorld in the region even if LATAM does not join Skyteam. And in any case Skyteam will benefit indirectly thanks to Delta’s codeshares.
No one saw it coming, even though American was negotiating closer cooperation with LATAM at the same time.
Not a real problem in the medium term for American Airlines
But an announcement that does not push to give in to panic. It is not the first time that an airline leaves an alliance to join another or not and it always happens in a rather clean way with a transitional period better managed than a Brexit.
And, as far as code-sharing between American and LATAM is concerned, there is no rush either, as LATAM will now be “non-aligned”. There are many cases of partnerships between airlines from competing alliances, this has always existed and will always exist, and in some cases it even works in a fairly permanent way. In short, there is time for American and LATAM to see how to manage this transitional period towards the logical end of the partnership without throwing dishes at each other.
American, the spurned bride
But American saw red right away and we cannot speak of a peaceful transitional period in this case. In less than one night here is what was decided:
– American Airlines no longer allows LATAM to issue tickets for travel on American. Immediate effect.
– American Airlines will no longer accept baggage that has been checked on LATAM routes even if it is a single trip record.
It looks like the spurned bride is having a nervous breakdown!
And finally, even though it wanted to get closer to LATAM, American Airlines is now announcing that the partnership was of little value to it and that it was not a big loss.
Big scare and passengers pay for it
Contrary to the airline’s denials, we can’t help but think that American is having a very hard time with the fact that a partner is leaving and, what’s more, is leaving to go into the arms of a national competitor!
But while waiting for things to get back to normal and for the partnership with Delta to become effective, it is above all the passenger who is paying the price for the lack of a transitional period and for American’s epidermal decision.
It is only a short step from there to thinking that the risk for American of losing its hegemony over South America is much more real than it wants to say.
Photo : American Airlines by GagliardiPhotography via Shutterstock
