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Delta Air Lines, WestJet Partnership Gets Canadian Sign Off

Edward Russell
Edward Russell
Contributor
Edward Russell is a contributor for TPG. An AvGeek at heart, he covered the airline business at FlightGlobal for eight years and previously covered finance in New York and Hong Kong.
June 27, 2019
•
2 min read
LAX Airport Operations
Delta Air Lines, WestJet Partnership Gets Canadian Sign Off
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Delta Air Lines and WestJet's proposed joint venture has been approved by Canadian officials, a key step towards implementing the partnership.

The Canadian Competition Bureau (CCB) will not challenge the tie-up, leaving US regulators the final big hurdle for the partnership, the carriers say in a joint statement today.

CCB spokesperson Jayme Albert confirms that the bureau will not challenge the proposed joint venture, but adds that a challenge can be filed against the tie-up within a year of implementation.

"Today's clearance by the CCB is an important step towards satisfying the conditions necessary to implement the proposed WestJet-Delta transborder joint venture," says Ed Sims, CEO at Calgary-based WestJet, in a statement.

The joint venture, first announced in 2017 and finalized last July, would allow Delta and WestJet to act as essentially a single airline between Canada the USA. With antitrust immunity, the companies could coordinate schedules and fares, jointly market flights and align their US-Canada operations in other ways.

"The joint venture between Delta and WestJet will create an expanded network with more frequencies and destinations, improved airport connections and significantly enhanced frequent flyer benefits," says Ed Bastian, CEO of Atlanta-based Delta, in a statement.

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In 2018, the airlines carried nearly 8.4 million passengers between Canada and the USA, or 27% of the market, DOT data provided by Diio by Cirium shows.

Delta and WestJet plan to grow transborder capacity by 20%, including launching six new routes, under the partnership, they said in their application to the US Department of Transportation in October 2018. They anticipate the pact could generate at least $241 million in consumer benefits, including the additional service and improved access to their combined networks for passengers.

WestJet has already launched a number of new transborder routes from its Calgary base this year. Flights began to Delta's core Atlanta hub in March; Portland, Oregon, in April; and Delta's focus city in Austin, Texas, in June, according to Diio.

Delta plans to grow transborder capacity by 4.6% in 2019, while WestJet is keeping capacity flat, the data shows.

Featured image by Patrick T. Fallon