DOJ Backs Move to Strip Delta–Aeromexico Antitrust Protection

Per Bloomberg, the Justice Department’s position rests on allegations that Mexico’s government has engaged in restrictive and possibly discriminatory practices that limit access for certain airlines at Mexico City’s Benito Juarez International Airport. US officials argue such actions have weakened competition between the two countries, undermining the goals of a bilateral air services agreement meant to liberalize the market.

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The alliance, approved under conditions tied to that 2015 agreement, allows Delta and Aeromexico to coordinate routes and pricing. However, US regulators say recent slot restrictions and a ban on certain cargo operations at the capital’s main airport violate the spirit of that deal. Mexico has sought to divert some air freight to a new airport outside the city, Bloomberg reported.

Related: US Targets Delta-Aeromexico Alliance in Airline Antitrust Clash with Mexico

In their own filing Monday, Delta and Aeromexico pushed back, arguing the partnership benefits travelers and the economy, holding about 20% of the US-Mexico market. They cited the creation of thousands of jobs, hundreds of millions in economic benefits, and increased tourism spending in the US. Removing antitrust immunity, they warned, would hurt US consumers and businesses while doing little to change Mexico’s policies.

Transportation Secretary Sean Duffy has indicated the carriers could continue their partnership without antitrust protections, but only through more limited cooperation. The department is also examining other international airline agreements, Bloomberg noted.

Mexico’s infrastructure, communications and transport ministry has yet to publicly respond to the US filings.

Source: Bloomberg