South American airline LATAM has signalled its intentions to will leave the oneworld alliance, and form a partnership with Delta.
For its part, Delta has advised it will be buy into LATAM to the tune of $US1.9 Billion. This will give it a 20% stake in LATAM. This investment continues Delta’s continuing investment in a range of airlines around the world. Locally, this includes a joint venture with Virgin Australia.
Effect on OneWorld
This is a blow to OneWorld, given that LATAM provides oneWorlds main presence in South America,
The good news is that there is no immediate change to the relationship with oneWorld. They have simply given an indication of their intentions. There is also no timeline put on when they will exit OneWorld.
Therefore, we can expect that the existing frequent flyer arrangements will remain as they are. At least for the time being. Down the track, this will likely change.
For now, however, you will be able to earn points, and access all the other perks of the oneWorld alliance for the time being.
LATAM and Qantas
At present, LATAM and Qantas have a deep bilateral agreement beyond the oneWorld alliance. For example, they have an extensive codeshare arrangement.
When announcing its new 787 services to Santiago, Qantas played up its codeshare services. When flying to Santiago, Qantas customers can connect to a range of Qantas codeshare services operated by LATAM.
Will LATAM join SkyTeam?
At the moment, there has been no announcement in this regard. It is also possible that they will remain unaligned, as is the case with Virgin Australia.
Thoughts
This is going to shakeup the alliances. For oneWorld members, it leaves a hole in South America that may not be easily filled. For now, though, its a wait and see.
