Joint Venture between Delta, Air France, KLM and Virgin Atlantic takes off

It’s official, the joint venture between Delta Airlines, Air France, KLM and Virgin Atlantic took off this week.

Until now, there was a joint venture between Delta and Virgin and another between Delta, Air France, KLM and Alitalia. Remember that Delta holds 49% of Virgin Atlantic and 8.8% of Air France-KLM, while contrary to what had been announced and planned, Air France KLM did not take 31% of the capital of Virgin Atlantic. This second joint venture is now extended to Virgin Atlantic, but without Alitalia.

The last step in a long process

Codeshares had been in place just under a year ago allowing the three airlines to offer more options to their respective passengers and for members of each airline’s frequent flyer program to earn miles on the flights involved.

From now on, members of each airline’s frequent flyer program will be able to earn miles on all flights of the joint venture’s member airlines (transatlantic, intra-European or domestic in the USA) and benefit from the advantages linked to their status.

More options for passengers

For passengers this represents a very significant offer:

up to 341 transatlantic flights per day, covering the top 10 routes in direct service,
connections to 238 cities in North America, 98 in Europe and 16 in the UK,
a choice of 110 non-stop transatlantic routes.

You notice the spin to say that on the 341 flights finally only 110 are direct, which by the way is already very important.

A dominant partnership on transatlantic routes

Commercially speaking we are talking about the leader of the transatlantic market since :

The joint venture represents approximately 23% of total transatlantic capacity, including cargo and passengers,
its combined annual revenue is estimated at $13 billion,
Air France, KLM, Delta and Virgin Atlantic have over 180,000 employees.

No Alitalia or Skyteam

We notice that there is still no question of Virgin Atlantic joining Skyteam, the decision being ultimately up to the English airline, which does not seem to be in a hurry, and given Delta’s attitude towards alliances, there is no guarantee that this will happen one day. It’s a pity because it would have allowed to fill up the presence of the alliance in Europe after the certain or potential departures of some members.

No Alitalia either, which was part of the previous joint venture. Given its condition, we can guess that the concerns of the Italian airline are elsewhere, but after a little digging it is not the primary cause. According to the U.S. Department of Transportation, following a complaint from JetBlue, the presence of the Italian airline would reduce competition on the U.S.-European route and its participation in the revised joint venture “premature” contrary to the requests of other members.

So we learn something interesting. While many thought that with the arrival of Virgin the others had taken the opportunity to get rid of a partner in poor health that they no longer needed, it seems that the presence of Alitalia was desired from the beginning by its partners but was at least provisionally rejected for competition reasons.