Well, that kind of comes out of nowhere … New partnership between American Airlines and JetSMARTAmerican Airlines and JetSMART have signed a letter of intent to create “The Broadest, Most Profitable Network in America”. Before we go into detail, some context may be important. JetSMART is an ultra-low-cost airline in South America that mainly operates from Argentina and Chile and currently serves 33 destinations. The company was founded in 2016 and is owned by Indigo Partners, which also includes the ultra-low-cost airline Frontier Airlines. JetSMART operates a fleet of 20 aircraft from the Airbus A320 family, with a further 79 aircraft from the A320 family on order. What does this new partnership between American Airlines and JetSMART look like? Subject to regulatory approval, here are the plans:
Here is a map of the potential connectivity options between the two airlines: Vasu Raja, American Airlines’ Chief Revenue Officer, describes this strategy as follows:
My opinion on this investment and partnershipAmerican Airlines has long been the leading global US airline in Latin America. American operated many routes to Latin America and then had extensive connectivity thanks to its oneworld partner LATAM. All of that changed in 2019 when Delta bought a 20% stake in LATAM. With this, LATAM left oneworld and ended its partnership with American. American has tried to rebuild its connectivity within Latin America. First American announced that it is building a closer relationship with Brazilian low-cost airline GOL, and now American is partnering with JetSMART. Here is my general opinion:
Bottom lineAmerican Airlines intends to invest in JetSMART to help the South American ultra-low-cost airline grow rapidly. The two airlines also intend to enter into a partnership that will include a codeshare agreement as well as the ability for AAdvantage members to earn and redeem miles on JetSMART flights. Since American lost the LATAM partnership, it is now looking for GOL and JetSMART to fill this gap. American is doing its best under the circumstances, but I still find it hard to get excited about it. What do you think of this new partnership between American and JetSMART? Via https://globalconnekt.com/wow-american-airlines-invests-in-jetsmart/
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