Delta and Aeromexico Seek to Block U.S. Order Ending Joint Venture Over Competition Concerns

Delta Air Lines and Aeromexico have asked a U.S. appeals court to block a Trump administration order requiring them to end their long-standing joint venture, which allows the airlines to coordinate scheduling, pricing, and capacity for U.S.–Mexico flights. The carriers argue that the Department of Transportation’s (USDOT) decision is arbitrary, capricious, and could severely disrupt operations.

In September, the USDOT ordered the airlines to unwind their nearly nine-year partnership by January 1, citing anticompetitive effects in the U.S.–Mexico City market. The department claims the collaboration gives Delta and Aeromexico an unfair advantage, potentially leading to higher fares, limited capacity, and disadvantages for other U.S. carriers. However, USDOT has not required Delta to sell its 20% stake in Aeromexico.

Both airlines contend that the market remains competitive, pointing out that their combined seat share is 20%, compared to American Airlines’ 21%. Delta warned that without court intervention, its operations could face “severe disruptions,” possibly leading to canceled flights and smaller aircraft on key routes. The airline also claimed that up to $800 million in annual consumer benefits could vanish if the joint venture ends.

Aeromexico told the 11th Circuit Court of Appeals that complying with the order would force the company to incur unrecoverable costs, including hiring new staff, rebranding in the U.S., and separating IT systems from Delta’s. The Mexican carrier argued that these actions would cause significant operational challenges.

Despite requests to delay enforcement, the USDOT rejected the appeal on Friday and declined to comment further. Delta and Aeromexico, which currently operate about 60% of passenger flights between Mexico City and the U.S., continue to assert that their partnership enhances connectivity and benefits travelers.