Four legacy carriers to earn $13 billion from joint venture
The new joint venture (JV) among four legacy carriers has been estimated to earn the airlines $13 billion in revenue yearly. The venture henceforth overlaps operations of Air France, KLM, Delta and Virgin Atlantic across Lagos and other Atlantic routes, with further route expansion across Europe, the UK and North America.
The JV represents approximately 23 per cent of total passenger and cargo trans-Atlantic capacity, with over 180,000 employees work across Air France, KLM, å and Virgin Atlantic. Also on the card is up to 341 daily trans-Atlantic services, covering the listed top 10 routes on a nonstop basis. In addition, onward connections to 238 cities in North America, 98 in continental Europe, 16 in the UK, and choice of 110 nonstop trans-Atlantic routes.
Speaking at the launch of the partnership recently, Virgin Atlantic Chief Executive Officer (CEO), Shai Weiss, said customers were at the heart of this expanded joint venture with their partners Delta, Air France and KLM. Weiss said the gains would include seamless connections, greater range of flights, unrivalled customer service, and increased frequent flyer benefits.
“One of the pillars of our strategy is successfully collaborating with our partners. Combining our strengths, our network, and our people allows us to achieve more together,” he said. The new partnership provides customers with more convenient flight schedules and a shared goal of ensuring a smooth and consistent travel experience, whichever airline people fly.
The partnership also provides the flexibility to book flights on any of the four carriers through respective mobile apps, websites, or via travel agents. Customers will enjoy award-winning service, top-tier premium cabin products and complimentary food, drink and seat-back in-flight entertainment in all cabins on all trans-Atlantic flights.
Enhanced customer benefits starting from 13 February mean that loyalty programme members will be able to earn and use miles or enjoy elite benefits for flights on any of the four airlines’ worldwide operations, including a trans-Atlantic trip, intra-Europe hops, or domestic U.S. journey, offering more opportunities to quickly move through loyalty tiers and reach a higher status. Eligible Elite loyalty programme members can also enjoy priority boarding and relax in over 100 airport lounges when travelling internationally.
Delta CEO, Ed Bastian, said the expanded partnership was a major step forward for all of the airlines, they deliver greater reliability, top travel benefits and leading service that customers deserve. “Today’s launch brings our historic, longstanding collaboration to a new level as we continue to build the partnership of choice across Europe and North America that sets us apart from the rest of the industry.”
Air France-KLM Group CEO, Benjamin Smith, added that 10 years after starting the joint venture with Delta, this new agreement was a major milestone that would further reinforce presence on the Atlantic, by allowing passengers the choice between four major airlines combining their network for the benefit of customers.
“For Air France-KLM, it also means greater access to the U.K. market and especially London Heathrow, the leading global travel market.”
Governance of the joint venture will be equally shared between the Air France-KLM Group, Delta and Virgin Atlantic. An executive committee comprising the three CEOs and a management committee of representatives from departments across the businesses will define future strategy.
Air France, KLM and Delta have been in a joint venture partnership between Europe and North America since 2009, while Virgin Atlantic and Delta have had a partnership between the U.K. and North America since 2013. Establishing a single transatlantic joint venture was the next strategic step in the collaboration between the airlines.
In 2019 the airlines began paving the way for their expanded cooperation with the start of the first codeshares between Air France, KLM and Virgin Atlantic. The agreement offered Virgin Atlantic customers up to 58 new routes from 18 U.K. airports across the Atlantic via Paris and Amsterdam, while Air France and KLM customers were given access to 24 new North America routes operated by Virgin Atlantic and Delta departing the U.K. including connections via London Heathrow and Manchester.
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