LATAM pronounces termination of joint venture plans with IAG
Category: #headlines  By Saipriya Iyer  Date: 2019-12-09
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LATAM pronounces termination of joint venture plans with IAG
  • The two companies are anticipated to part ways after the decision of exiting the Oneworld alliance.
     
  • Apparently, the decision is unlikely to affect the long terms relationship of the companies.

In a recent instance of calling off an anticipated partnership, South American, LATAM Airlines has reportedly announced the termination of supposed joint venture with the International Airlines Group (IAG) after standing to its decision of opting out of the Oneworld agreement. It is imperative to state that the plans of JV were earlier announced in the initial months of 2016.

An official source from the Airlines Group stated that IAG and the company have collectively agreed on terminating the proclaimed alliance. However, the interline agreements, the accessible contracts for VIP lounges, regular passenger schedule, and codeshare agreements between the airlines are likely to remain valid.

A statement by LATAM reported that the decision on disrupting the JV plan was incorporated for the commercial reasons and with an intent to bringing about the changes across the aviation market when the idea was initially generated in 2016.

The announcement paved way after the Delta Air Lines in September this year announced an investment of over USD 1.9 billion in LATAM procuring over 20 per cent business share in the company. Owing to this, the South American airlines settled the new codeshare agreement with the impending equity owner and Delta airlines, thereby eliminating the JV with British Airways. This termination is estimated to take place on 31st January the next year.  

The JV proposed in 2016 reported that the IAG carriers, British Airways and Iberia would commercially cooperate with LATAM on the flights traversing between the European Union and South America. In line with this, an IAG announcement stated that the unison to enhance the links for connecting passengers would extend the customer choice through integrated networks, additional frequencies on the current routes, and advanced non-stop routes.

For the record, LATAM established itself as a Oneworld partner in 1999, via the support of Chilean component transferor, LAN Airlines.

Source credit: https://simpleflying.com/latam-iag-jv-cancel/

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About Author

Saipriya Iyer

Saipriya Iyer    

Saipriya Iyer currently works as a content developer for GroundAlerts. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had previous experience of 3 years under her belt, she has dabbled with website ...

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