American and LATAM tout new routes in case for joint venture

American Airlines and LATAM Airlines Group promise millions of dollars in consumer benefits in their application to US authorities for an immunised joint venture. The Oneworld Alliance carriers tout up to $273m in annual benefits from their proposed tie up that would cover flights between the USA and Brazil, Chile, Colombia, Paraguay, Peru and Uruguay if approved, in an application to the US Department of Transportation on 3 April. Benefits include improved connectivity, better passenger amenities and even new routes. "The [joint venture] will integrate highly complementary route networks—with one anchored in the United States and the other in some of South America’s largest and most vibrant economies—to produce the kind of integrative, pro-competitive efficiencies that the [DOT] has observed from joint businesses implemented elsewhere worldwide," say American and LATAM. The partnership, which was announced in January 2016 but was held up by a myriad of factors including the delayed ratification of the US-Brazil open skies treaty, would combine the two largest US-South America networks. American flew 26.7% of capacity between the markets covered, and LATAM 26.5% of capacity in 2018, Cirium schedules data shows. Despite their clear market dominance, American and LATAM claim that they need an immunised joint venture to compete – and grow – against other carriers and expanding low-cost carriers. They cite the proposed Avianca, Copa Airlines and United joint venture, as well as JetBlue Airways' and Spirit Airlines' growing US-South America networks in their application.<br/>