(eTN) – Alitalia, Italy’s leading airline, announced in Rome on Tuesday, July 6, that it has joined the Air France-KLM Group and Delta Air Lines as a member of the airline industry’s “leading trans-Atlantic joint venture.”
The “venture” was launched in April 2009, the multi-party agreement created a single, coordinated network for customers flying across the Atlantic, allowing the member airlines to share revenues and costs on their trans-Atlantic routes.
Through the four-way joint venture, the airlines are saying that passengers have convenient access to the world’s largest trans-Atlantic network, which offers almost 250 flights and approximately 55,000 seats each day, now including 20 daily trans-Atlantic flights to five US destinations from Rome and Milan Malpensa airports. With Alitalia’s addition, the joint venture represents approximately 26 percent of total trans-Atlantic capacity, with annual revenues estimated at more than US$10 billion.
Alitalia said Rome joins Amsterdam, Atlanta, Detroit, Minneapolis, New York-JFK and Paris-CDG as the core hubs of the joint venture, with additional trans-Atlantic service from Cincinnati, Milan Malpensa, Memphis and Salt Lake City. Wherever traffic rights permit, the airlines offer customers codeshare service between the United States and the European Union, and in many cases beyond, creating one network for seamless airline-to-airline connections between points in North America and the European Union.
The joint venture’s geographic scope includes all flights between North America and Europe, between Amsterdam and India and between North America and Tahiti.
“Today marks an important milestone in Alitalia’s development plan,” said Alitalia’s CEO Rocco Sabelli. “Trans-Atlantic traffic is the most strategic and competitive marketplace. We are proud to be partnering with the world’s leading airlines in a joint venture which the whole industry looks at as the benchmark. Such an achievement highlights the valuable results obtained so far by Alitalia, and further opens-up opportunities for our industrial and commercial growth.”
“Delta’s partnership with Europe’s leading airlines has been a great success and has enabled us to add new destinations and convenience for customers across the United States and Europe,” said Delta CEO Richard Anderson. “The addition of Alitalia to our joint venture will further bolster our ability to optimize resources, protect revenues and provide more benefits for our employees and shareholders.”
“The trans-Atlantic joint venture has been strengthened by the arrival of Alitalia, which adds the Italian market, the third biggest in Europe, to the JV and also gives it access to the Rome-Fiumicino hub,” said Air France-KLM CEO Pierre-Henri Gourgeon. “The Italian airline, a SkyTeam member, is a strategic partner of Air France-KLM with which it already has joint venture agreements on its Italy-France and Italy-Netherlands routes. It is therefore natural that this successful partnership should continue with Alitalia’s participation in the trans-Atlantic JV.”
“The inclusion of Alitalia is an important step for the joint venture and will strengthen the position of the other JV partners in the very important Italian market,” said KLM President and CEO Peter Hartman. “Our customers can now choose between multiple gateways in the U.S. as well as in Europe, via Amsterdam Schiphol, Paris Charles de Gaulle and Rome Fiumicino.”
According to the Italian carrier, governance of the joint venture will be equally shared among the airlines. “Alitalia representatives will immediately join the joint venture’s 11 working groups responsible for implementing and managing the agreement in the areas of network, revenue management, sales, product, frequent flyer, advertising/brand, cargo, operations, information technology, communications and finance. Alitalia also will be included in all joint venture initiatives, including joint sales contracts, which launched in January 2009.”
Alitalia’s addition to the joint venture is effective April 1, 2010 as part of a long-term agreement effective until at least March 31, 2022.
The long history of cooperation among Air France, KLM and Delta dates to 1997, when KLM signed a joint venture agreement with Northwest Airlines. Delta, which merged with Northwest in 2008, signed its own joint venture agreement with Air France in 2007 following eight years of close trans-Atlantic cooperation. In 2009, both joint ventures were combined into one following the Delta-Northwest and Air France-KLM mergers.
The alliance of the four airlines, which is enabled by trans-Atlantic antitrust immunity granted by the US and European governments, has delivered a number of benefits to consumers over the last decade. Dozens of new routes have been created as a result of the airlines’ cooperation, including Delta’s first service to London-Heathrow from Atlanta, Minneapolis-St. Paul, Detroit and New York-JFK. New nonstop service has also been launched between mid-sized cities such as Portland, Ore. and Amsterdam; Pittsburgh and Paris; and Salt Lake City and Paris.
The joint venture paves way to nearly 250 daily trans-Atlantic flights and a fleet of 144 aircraft, providing customers with the benefits of a vast route network offering more frequencies, competitive fares and harmonized services on all trans-Atlantic flights. It is structured around seven main hubs: Amsterdam, Atlanta, Detroit, Minneapolis, New York-JFK, Paris-CDG and Rome Fiumicino, together with Cincinnati, Lyon, Milan, Memphis and Salt Lake City.
The joint venture will also offer customers access to 300 destinations beyond the 26 North American gateways and 200 destinations beyond the 33 European gateways throughout Europe, Asia and Latin America.
In addition, the joint venture will represent 26 percent of total trans-Atlantic capacity and generates $10 billion in annual revenues. Under the terms of this agreement, the partners jointly operate their trans-Atlantic routes, thereby sharing revenues and costs.