Delta Air Lines, Air France-KLM, and Virgin Atlantic have applied to the US Department of Transportation for approval for an amended transatlantic joint venture agreement, replacing the currently existing two parallel partnerships. The amended joint venture will no longer include Alitalia (AZA, Rome Fiumicino) as a party.

"The Amended JVA will replace Delta's two parallel transatlantic joint ventures with a combined joint venture that will integrate the commercial activities of the Parties and establish metal neutrality between Virgin Atlantic, on the one hand, and Air France and KLM, on the other, for the first time... The joint venture will also enhance competition with other carriers and alliances, and, in particular, enable the Parties to compete more effectively with British Airways and its partners in and beyond the United Kingdom," the carriers said.

Delta and Virgin Atlantic secured antitrust immunity for their transatlantic joint-venture in 2013. The Skyteam joint venture between Delta, Air France, KLM Royal Dutch Airlines, and Alitalia dates back to the 1993 agreement between KLM and Northwest Airlines.

The application said that the amended joint venture would largely fall under the scope currently covered by the two pre-existing and immunised joint ventures. It will expand the geographical scope of the metal-neutral cooperation and, according to the carriers, would generate USD85 million in incremental benefits to the passengers per year.

According to the ch-aviation capacity module, all five airlines currently have a 24.3% market share on the North America-Europe market by capacity. Alitalia has the most modest significance with just a 1.3% market share.

The implementation of the amended joint venture, if approved by the DOT, will require the prior termination of the existing Skyteam joint venture. Consequently, Alitalia would cease to be a member of the joint venture.

"Alitalia is not a party to the Amended JVA, which will not be implemented until the preexisting SkyTeam JV to which Alitalia is a party is terminated according to the terms of that agreement. Although the Parties hope to implement metal-neutral cooperation with Alitalia in the future, Alitalia is currently undergoing restructuring through the Italian bankruptcy process, and its future ownership structure is uncertain. The timing of any future agreement with Alitalia is currently uncertain," the application said.

The joint venture covers all routes between North America and Europe, and between North America and French Polynesia (as long as Air France continues to operate such routes). In addition, it also covers all transatlantic routes between North America and Africa, India, Pakistan or the Middle East operated by Delta, as well as all transatlantic routes between Europe and Northern South America or Central America operated by the European carriers.

Delta has a 49% stake in Virgin Atlantic and a 9% stake in Air France-KLM. The Franco-Dutch holding, in turn, has announced its intention to acquire a 31% stake in Virgin Atlantic in connection with the amended joint venture.

Delta is the market leader by capacity on the North America-Europe market among individual airlines with a 9.5% market share. Among the three big joint ventures, the Lufthansa Group-United Airlines-Air Canada joint venture has a combined market share of 23.7%, while the British Airways-Finnair-Iberia-American Airlines joint venture has 18.6%.