The Transportation Department has ordered Delta Air Lines and Aeromexico to dissolve their joint venture by the end of the year.
The joint venture was originally established in December 2016, when then-President Barack Obama’s Transportation Secretary Anthony Foxx approved antitrust immunity for the two airlines. It allowed the companies to coordinate their pricing and sales, network plans, and frequent flier programs.
Transportation Secretary Sean Duffy said Mexico has refused to follow the 2015 U.S.-Mexico Air Transport Agreement, giving the two joint venture companies an upper hand on U.S. carriers.
“Empty promises mean nothing,” Duffy said in a press release. “After years of taking advantage of the U.S. and our carriers, we need to see definitive action by Mexico that levels the playing field and restores fairness. Under President Trump’s leadership, we will continue to put America First and hold any country who thinks they can distort the rules accountable.”
Duffy foreshadowed this move in July, when he submitted a show-cause order proposing to withdraw the antitrust immunity between the two companies.
Transportation Department officials said the two companies must dissolve their joint venture by Jan. 1, 2026, ending any practices that require antitrust immunity, such as “common pricing, capacity management, and revenue sharing.”
A Delta spokesperson said the order will have no effect on scheduled flights and that company personnel are “considering next steps.”
“We are disappointed that the Department of Transportation has chosen to terminate its approval of the strategic and pro-competitive partnership between Delta and Aeromexico, a decision that will cause significant harm to U.S. jobs, communities and consumers traveling between the U.S. and Mexico,” Delta said in a statement.
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An Aeromexico spokesperson also said in a statement that company personnel were disappointed with the decision, according to a CNBC report.
The decision lets the two companies continue to cooperate with their frequent flier program and marketing strategies, according to the Transportation Department release. The order does not affect Delta’s 20% equity stake in Aeromexico.