By David Shepardson
WASHINGTON (Reuters) -Aeromexico asked the 11th Circuit Court of Appeals on Friday to halt a Trump administration order forcing the country to dissolve a joint venture with Delta Air Lines by Jan. 1 that allows the airlines to coordinate scheduling, pricing and capacity decisions for flights between the U.S. and Mexico.
Aeromexico said it would face significant costs that it could not recover even if a court later upheld the settlement. In September, the U.S. Department of Transportation ordered an end to the nearly nine-year-old joint venture as part of several actions targeting Mexican aviation, citing competition concerns.
USDOT did not immediately comment.
Aeromexico said the order requires it to “reroute.”
exist and hire new staff, establish a new brand presence in the US, separate the information technology platforms for US pricing and sales from Delta's.”
The Mexican airline added that the airlines would suffer “concrete, calculable harm from such an upheaval in their brand and operations.”
In August, USDOT said the joint venture should be terminated due to “continued anticompetitive effects on the markets between the U.S. and Mexico City, which provide an unfair advantage to Delta and Aeromexico.”
The airlines account for approximately 60% of passenger flights from Mexico City Airport to the US. The airport is the fourth largest international gateway to and from the United States.
Aeromexico said that, together with Delta, it has a 20% seat share in the U.S.-Mexico market, compared to 21% for American Airlines.
USDOT, which is not requiring Delta to sell its 20% equity stake in Aeromexico, has said the company's likely problems include higher fares in some markets, reduced capacity and challenges for U.S. airlines from government intervention.
Delta says up to $800 million in annual consumer benefits could evaporate, two dozen routes could be canceled and smaller planes could replace existing planes if the joint venture were to disappear.
(Reporting by David Shepardson; Editing by Richard Chang)
