LATAM has set their alarm to call it quits from oneworld by October 2020. The carrier has developed a deeper partnership with Delta and thus no longer needs to be in the oneworld alliance.
What are the details?
LATAM had been somewhat happily married into the oneworld alliance for some time. Whilst it did partner with some fellow oneworld airlines like Qantas in Australia and Iberia for routes to Spain, its biggest partner was, in fact, American Airlines.
The South American airline acted as the second airline for American Airlines in the southern continent, allowing passengers to travel across to many areas that AA could have no hope to cover. This partnership was very lucrative for both airlines and no one could have guessed that LATAM would walk away from the table.
Delta Air Lines invested $1.6 billion USD into LATAM for 20% of the airline. Because they now owned 1/5 of the airline there was no way their investment was going to keep working with their rival American Airlines.
This alliance with Delta strengthens our company and enhances our leadership in Latin America by providing the best connectivity through our highly complementary route networks”, said Enrique Cueto Plaza, chief executive officer of LATAM. “We look forward to working alongside one of the world’s best airlines to enhance the travel experience for our passengers”.
Thus, they suggested to LATAM that they leave oneworld effective immediately.
“LATAM advised oneworld earlier today of their decision to partner with an airline outside of the oneworld alliance. LATAM further advised oneworld that they intend to leave the alliance in due course and in accordance with formal contractual requirements. We are disappointed, but we respect their decision. They have been a valued long-term member of the alliance, and we wish them well.” – oneworld press statement
The alliance and LATAM then went quiet as the details were worked out, only to reveal today that their departure date would, in fact, be sometime in October 2020.
Where does this leave oneworld?
Now, oneworld is in a bit of a jam.
Whilst they have an excellent presence in North America (American Airlines), Europe (IAG, Finnair and S7), Asia (Japan Airlines, Malaysia Airlines and Cathay Pacific), Australia (Qantas) and the Middle East (Qatar), they now no longer have an airline in South America… at all.
This is huge, this is practically leaving an entire continent of people unserved with only routes off the continent and non-between them (until that new Qatar fifth freedom route opens up).
So far, Qantas has reaffirmed its partnership with LATAM for cross South Pacific travel, however, passengers will no longer get status credits when they fly.
“There are no changes to our codeshare with LATAM as a result of recent announcements,” Qantas spoke to Executive Traveller regarding LATAM “Qantas and LATAM have agreed that the bilateral agreement we have works well for customers and we will look for opportunities to enhance it in future.”
But oneworld might find themselves waiting in the wings until they can snap up another airline to join them in the sky.
Perhaps that airline might be Aerolineas Argentinas. As mentioned by Simple Flying reader Phil in our last article on the subject, Aerolineas Argentinas can’t be thrilled at all that fellow Skyteam member Delta is getting into bed with their rival in South America. Perhaps it might make them even cast an eye over towards oneworld.
What do you think? Let us know in the comments!