LATAM leaves Oneworld Alliance

Real World Aviation
#1

On Thursday evening, the aviation community received a true shocker as Delta announced a 20 percent acquisition in the LATAM Airlines Group in the form of a $1.9 billion investment in the largest South American carrier. The deal will see Delta significantly increase its reach in South America, as both carriers cooperate on flights between both region; while improving much-needed cash flow generation for LATAM, enabling it to focus on its future strategic objectives. Notwithstanding, LATAM will leave the Oneworld alliance as part of the agreement, in favor of individual partnerships and codeshare agreements with different operators.

Which Alliance should LATAM join next? Sky Team? Or Star Alliance?

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#2

Uh… the title of the link you posted says:

Remain Unaligned

So… no.

IF it were to happen, Star Alliance is a big no, Delta would definitely not let them join.

I’ll say what I said in the other topic regarding Delta’s stake in LATAM: Delta Buys A 20% Stake In LATAM; LATAM To Exit Oneworld

My opinion in this:
I’ve got this theory that SkyTeam will end. Alliances are becoming irrelevant as more airlines are partnering with specific airlines rather than the airlines in the alliance… (China Southern as an example, left SkyTeam to partner with American, BA, Emirates, Finnair, Qatar, etc.)
There’s an article earlier quoting Delta CEO Ed Bastian that “SkyTeam has failed”.
This seems like the first step into that…

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#3

I disagree on your statement. 20% is still small. LATAM still own and decide for their future. Beside LATAM is a group company which some codeshares are SkyTeam and Star Alliance. So, I think in the future they will join for a Alliance.

#4

20% seems rather large given that it was enough to pull LATAM away from American.

I believe LATAM only codeshares with Star Alliance members Air China, Lufthansa, Swiss, and South African Airways. The majority is Oneworld, with a select number of SkyTeam members like Aeromexico, Air France, Korean Air, and soon, Delta.

Don’t forget that Oneworld member (or in the near future NOT Oneworld member) Qatar Airways, one of the airlines Delta has been targeting with the help of Trump due to “unfair” subsidies, has its 10% stake in LATAM. Delta knew this when buying the stake in LATAM.

The fact that they will continue to codeshare with so many different airlines (British Airways, Iberia, Korean, Qantas, Delta, Air China, etc.) sounds like LATAM will employ the same exact strategy former SkyTeam member China Southern is currently doing.

American Airlines bought a 2% stake in China Southern (CZ)…

  • The two airlines began codesharing with reciprocal/frequent flier benefits
  • SkyTeam limited China Southern as they were not allowed to codeshare with too many airlines outside of SkyTeam.
  • CZ became unhappy.
  • CZ left SkyTeam for American and other non-SkyTeam airlines like British Airways, Finnair, Qatar, Qantas, etc.
  • Some months later, Qatar Airways bought a 5% stake in China Southern.
  • Shortly after that, Emirates, of all airlines, began codesharing with CZ…

CZ remains unaligned today, and will continue to be unaligned for who knows how long. Oneworld has confirmed it has approached CZ, asking if they wanted to join OW. Nothing on that, it seems. CZ seems to prefer being an unaligned carrier, creating strong partnerships with global airlines across any alliance.

Like I said, alliances are becoming irrelevant, and these two patterns are supporting that. I may end up being completely wrong, but we’ll see what Delta/LATAM’s next move is…

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#5

Note that almost all of these airlines are members of OneWorld…

#6



It appears they have given the date of their exit from Oneworld. I wonder if they will remain unaligned or possibly form some kind of alliance with Delta?

#7

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