U.S. AIR CARRIERS SPAR OVER THE DEPARTMENT’S PLAN TO WITHDRAW AEROMEXICO-DELTA ANTITRUST IMMUNITY
September 15, 2025
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On or about August 20, 2025, Allegiant Air, American Airlines, Delta Air Lines, and United Airlines all submitted regulatory filings in the dispute between DOT and the Mexican government over suspected violations of the 2015 U.S.-Mexico Air Transport Agreement. By way of background, DOT issued a Supplemental Order to Show Cause on July 19, 2025, seeking to withdraw antitrust immunity (“ATI”) previously granted to the Aeromexico-Delta joint venture (the “JV”). The Department’s original ATI grant was conditioned on, among other things, slot divestitures at Benito Juarez International Airport (“MEX”) and continued compliance with the U.S.-Mexico Air Transport Agreement. According to DOT, the conditions required for the immunized JV no longer exist due to anti-competitive measures undertaken by Mexico including reducing capacity at MEX, confiscating U.S. air carrier slots at MEX, and operating a non-transparent and discriminatory slot allocation program. To ensure a complete record on the matter, DOT invited interested parties to submit comments on the Department’s tentative findings and competitive issues in the U.S.-Mexico market.
Allegiant and Delta contend that the Department’s tentative findings overlook the fact that since the Department granted ATI over eight years ago, the U.S.-Mexico market is now more competitive due to the JV’s new routes, expanded capacity, enhanced products, and more convenient service offerings. Delta also claims that other U.S. air carriers, most notably American and United, are adopting self-serving positions in this proceeding purely because revoking ATI would weaken one of their competitors in the U.S.-Mexico market such that American and United could once again become the predominant players. Instead of revoking ATI, Delta asks the Department to consider alternative mechanisms such as consultations and arbitration under Articles 13 and 15 of the U.S.-Mexico Agreement because ATI revocation would unfairly discriminate against the JV. Further, Allegiant and Delta allege that if DOT were to finalize the tentative findings, it would violate the Administrative Procedure Act (“APA”) because the Department would implement an Open Skies predicate for ATI which arguably exceeds statutory authority. While the existence and extent of Open Skies should be one factor analyzed by the Department under the ATI statutory analysis, they argue that the Order would impose a blanket ban on ATI requests when a foreign government does not fully adhere to an Open Skies agreement. American and United, on the other hand, reason that DOT should require the Open Skies predicate because such a condition removes protectionist barriers that tend to insulate foreign air carriers from robust competition. American further explains that Mexico’s failure to comply with the U.S.-Mexico Air Transport Agreement presents sufficient grounds to warrant withdrawal. According to American and United, DOT precedent makes clear that certain conditions, including an Open Skies predicate, must exist to prevent foreign governments from unfairly protecting their own carriers from U.S. competition.
The Department must now consider comments submitted by all interested parties and determine whether to proceed with the Order. If finalized, Delta and Aeromexico could be forced to wind down the JV as soon as October 25, 2025, absent further legal proceedings.
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