Delta Air Lines and the Virgin Blue Airlines Group plan to seek regulatory approval to form a joint venture that will expand both carriers’ reach between the USA and Australia and the South Pacific.
The carriers say that, if it is approved, the alliance will allow Delta and the Virgin Blue Airlines Group to compete more effectively in those markets by collaborating on route and product planning, codesharing on their respective networks and extending frequent flyer program benefits and lounge access to customers of both airlines.
In advance of their joint venture, the carriers are moving forward to implement codesharing, frequent flyer program reciprocity and lounge exchange privileges. Delta and the Virgin Blue Airlines Group say they will file antitrust immunity applications with the U.S. Department of Transportation and with the Australian Competition and Consumer Commission.
Delta began daily nonstop service between Los Angeles and Sydney on July 1 with a Boeing 777-200LR equipped with 180-degree, full-flat beds in its BusinessElite class. V Australia, Virgin Blue Group’s long-haul carrier, operates a daily nonstop Boeing 777-300ER service between Los Angeles and Sydney, and service three times a week between Los Angeles and Brisbane. V Australia also plans to launch a new, three-times-weekly service between Los Angeles and Melbourne is planned in September. The three-class airline offers 33 Business Class fully lie-flat beds, 40 Premium Economy club seats and 288 economy seats plus two in-flight bars in its 777-300ERs.
V Australia additionally has just concluded a reciprocal frequent-flyer program agreement with Virgin Atlantic Airways and plans to begin a codeshare with Virgin Atlantic in the future. The group’s short-to-medium haul carrier, Virgin Blue, which operates throughout Australia and Oceania, already has a codeshare agreement and a frequent-flyer program agreement with Virgin Atlantic.
This begs the question of whether Virgin Atlantic will begin seeking closer cooperation with Delta Air Lines, a competitor on transatlantic routes from London, in the future ― particularly once Virgin Atlantic’s former codeshare partner Continental Airlines moves from the SkyTeam alliance to the Star Alliance later this year.