Allegiant and Viva Aerobus Announce New Alliance
Allegiant and Viva Aerobus have teamed up to create a fully-integrated Commercial Alliance Agreement. The new partnership promises to expand options for nonstop leisure air travel between the United States and Mexico.
It is a first-of-its-kind in the airline industry between two ultra low cost carriers. As part of the agreement, Allegiant will also make an equity investment of $50 million in Viva Aerobus.
Allegiant and Viva Aerobus have submitted a joint application to the U.S. Department of Transportation (DOT) requesting approval of and antitrust immunity for the alliance. The transactions are also subject to clearance by the Mexican Federal Economic Competition Commission.
Combining the unique product offerings, networks and market experience, the alliance will achieve important public benefits that neither airline could provide independently.
Allegiant currently offers nonstop service to more than 130 cities across the country. But, it does not serve Mexico. The Monterrey-based Viva Aerobus on the other hand, offers extensive intra-Mexico service, as well as nonstop flights from Mexico to several destinations in the U.S. and Latin America. The Alliance Agreement will give Allegiant the opportunity to broaden its travel offerings to include new vacation destinations such as Cancun, Los Cabos and Puerto Vallarta, Mexico. At the same time, Viva Aerobus will have access to Allegiant’s network, growing its U.S. customer base.
The alliance will also enable Viva Aerobus to add routes in the United States, particularly in markets where Allegiant has a significant presence such as Las Vegas and several cities in Florida. These are also popular destinations for Mexican travelers to the United States.
A fully-integrated and immunized alliance will afford Allegiant and Viva Aerobus coordination across all areas of airline operations – including code-sharing, scheduling, marketing, information systems and loyalty programs, providing seamless access and benefits for customers of both airlines.
The alliance is anticipated to add new trans-border routes and nonstop competition where currently only connecting service is available. More than 250 new potential route opportunities have been identified as part of the DOT application. Allegiant and Viva Aerobus currently expect to offer flights under the alliance beginning in the first quarter of 2023, pending governmental approval of the application.
Per national requirements, Allegiant and Viva Aerobus will in parallel file for alliance approval with regulatory authorities in Mexico, including with the Mexican Federal Economic Competition Commission.
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Interesting. This really matching up as competition to Spirit and Southwest. Allegiant also serves a lot of secondary airports which could be attractive if they can figure out the proper flight times.