Delta Air Lines and Virgin Atlantic reached an agreement for a new joint venture Tuesday. But what does it mean for frequent fliers? (Read more: Delta Buys Virgin Atlantic Stake to Boost London Access)
The airlines will seek approval from government regulators on both sides of the pond, which will allow a closer relationship and coordination of schedules and operations. Once approved – a process likely by the end of 2013 – frequent fliers on Delta and Virgin Atlantic will enjoy new benefits.
Here's a short-list of what to expect in the near-term.
- A combined trans-Atlantic network between the United Kingdom and North America with up to 31 daily roundtrip flights.
- Passengers on both airlines will be able to earn and redeem miles across Delta's SkyMiles and Virgin Atlantic's FlyingClub frequent flier programs.
- Shared access to Delta SkyClub and Virgin Atlantic Clubhouse airport lounges for elite frequent fliers and premium cabin passengers.
Alliance-Building Is Key
Airlines are increasingly forging joint ventures and other alliances to remain competitive and attract a greater share of higher-paying business travelers.
"It just shows that in 2012, it is very difficult for an airline to operate outside of an alliance," said Henry Harteveldt, travel industry analyst at Hudson Crossing.
Virgin has long tried to remain independent of the three large global alliances — oneworld, Star Alliance and SkyTeam. But forging new joint ventures could be a step towards a strategy shift at Virgin. "I would expect in the course of the next year, Delta will attempt to bring Virgin into SkyTeam," said Harteveldt. Delta is a primary member of the SkyTeam alliance, along with 17 other airlines.
"We've always been very clear we will look at an alliance if we believe it is right," Julie Southern, Virgin Atlantic's chief commercial officer, said at Tuesday's press conference.
Short-Term Benefits of the Joint Venture
The new alliance, meanwhile, signals more benefits for fliers. "It will be good for frequent fliers on both sides," Harteveldt said. In particular, members of Delta's SkyMiles program will have more flight options to get to London. And Virgin Atlantic has one of the swankiest premium cabins flying today. (Read more: Virgin Atlantic Out Swanks Itself With New Luxury Suite)
For additional details on the joint venture, click here for Delta's press release.