Viva Aerobús, Allegiant Announce Alliance

Mexican Viva Aerobús and US Allegiant Air have announced their intention to sign a fully integrated Trade Alliance Agreement, the first of its kind for the industry, which will expand economic travel options between the US and Mexico.

Allegiant currently offers nonstop travel services to more than 130 cities in the US but does not have operations in Mexico. The Las Vegas-based ultra-low-cost airline focuses on leisure travel. Maurice J. Gallagher, President and CEO, Allegiant, will join Viva Aerobús’s Board of Directors as the company will make a US $50 million equity investment in Viva Aerobús.

The two airlines have made their plans for a groundbreaking partnership official through a press release by Viva Aerobús. According to the press release, the alliance will result in great benefits for costumers which would not be offered otherwise, such as an increase in the quality of market experience, route networks and product value proposition for both of the airlines.

Viva Aerobús costumers will have increased access to economic travel throughout the US due to Allegiant’s notable presence in cities popular for Mexican travel such as Las Vegas. Meanwhile, Allegiant costumers will gain access to Mexican cities. The alliance will allow for coordination through code-sharing, scheduling, marketing, information systems and loyalty programs partnerships among the two airlines.

The airlines have submitted a petition to the US Department of Transportation (DOT) for an antitrust approval. If the petition is approved, the airlines are expecting to offer new flights by 1Q23. The two airlines will also be requesting approval from Mexican authorities such as the Federal Economic Competition Commission.

As the Omicron variant causes a severe rise of COVID-19 cases in the US, US airlines had to cancel thousands of flights during holiday weekend, a usual peak travel time for individuals in the country. Although most countries have implemented restrictions for travelers coming from the US as it is currently considered a high-risk country, Mexico has kept its doors open to US travelers.

Mexico’s Omicron numbers currently remain low but Deputy Minister of Health Hugo López-Gatell has not yet ruled out the possibility of the variant driving a fourth wave of infections in the country. However, because of the variant’s low hospitalization rates, López Gattel does not expect hospital beds to run out in the case of a fourth wave.