Delta Air Lines and Virgin Australia have been granted anti-trust immunity by the US Department of Transportation (DOT), enabling them to proceed with plans for a joint venture, on trans-Pacific routes.
The airlines intend to collaborate on rourtes between the US and Australia through codesharing, coordinating route and product planning and frequent flyer programme benefits and lounge access.
“We appreciate the DOT’s thorough review of our alliance with Virgin Australia and recognition of the important customer benefits,” said Glen Hauenstein, Delta’s Executive Vice President of Network, Revenue Management & Marketing. “This alliance will bring more effective competition to the region and provide consumers greater choice of destinations, frequencies and schedules.”
Delta alone serves a single point in Australia – Sydney – and Virgin Australia’s international airline, V Australia, flies only to Los Angeles. The anti-trust immunised alliance will allow the airlines to fully cooperate on network planning and distribution. The airline cited a Compass Lexecon study which estimated annual consumer benefits from the joint venture to total up to US$54 million.
Virgin Australia Airlines CEO, John Borghetti said; “We welcome the Department of Transportation’s proposed approval of our application for antitrust immunity with Delta, which will enable our airlines to deliver a more attractive and competitive service for travelers in Australia and North America.
“The Delta alliance is a key plank in Virgin Australia’s strategy to build an international network of airline partners that offers global coverage. If approved, Delta customers will be able to connect seamlessly to Virgin Australia’s extensive network of destinations across Australia, New Zealand and the South Pacific and earn frequent flyer points in the process,” Borghetti added.
Delta and Virgin Australia began with their first codesharing flights in January 2010. This month they will add five new destinations in Australia and New Zealand to Delta’s network via an expansion of the codesharing deal. Delta customers will be able to connect in Sydney on Virgin Australia Airlines flights to Brisbane, Melbourne, Perth, Adelaide and Canberra in Australia, and on Pacific Blue to Auckland and Christchurch, New Zealand. V Australia customers will also be able to connect in Los Angeles to Delta flights to San Francisco, Las Vegas, Atlanta, Detroit, New York-JFK and Orlando.