Access + $$$

A Joint Venture (JV) is a commercial profit and loss agreement undertaken jointly by two or more parties that otherwise retain their distinct identities. A joint venture differs from a codeshare agreement in both its limitations and its opportunities. There is unlimited revenue potential incentive with a joint venture, as opposed to a simple finder’s fee with a codeshare.

The One Mile at a Time blog said it well “If a codeshare agreement is like dating, then a joint venture is like getting married.” JV partnerships allow Delta to coordinate pricing and schedules with their JV partners and they agree to share revenue regardless of which airline operates each flight.

JVs, however, also require an extensive approval process. For example, JV agreements require government approval (antitrust immunity) and, at Delta, trigger negotiations with ALPA. Delta can only enter into a JV with a foreign carrier if Delta metal flies at least four round trips per week from the United States to the home country of that foreign carrier, and cannot reduce block hours to the partner’s home country (unless ALPA negotiates new terms). At Delta, JVs are also subject to all the restrictions in Section 1 of the contract.

Antitrust immunity is a crucial element to joint ventures – allowing Delta to act as one entity with its JV partner, coordinating on routes, fares and schedules. Antitrust immunity allows two companies to operate as if they were one, for the purposes of their agreement.

Delta currently has four active JVs (Air France/KLM/Alitalia, Aeroméxico, Virgin Atlantic and Virgin Australia) and two pending JVs (Korean Air and WestJet).

Read About Delta’s Joint Ventures

One Mile at a Time: Delta Pilots Angry Their Jobs Are Being Outsourced

 One Mile At A Time Blog recently covered Delta pilots' scope concerns Delta Air Lines has spent the past many years building up a global network of airline partners, through a combination of joint ventures and equity investments...Delta’s joint venture partners are...

Cranky Flyer Takes Stock of Delta’s Investments

Craky Flier covers Delta and The Perils of Investing in Partners It Can’t Control Delta Air Lines and LATAM Airlines have signed their highly anticipated joint venture agreement. The deal promises new levels of interconnectivity when traveling throughout the Americas....

“”