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News Article

Viva Aerobus, Allegiant Submit New Joint Venture Proposal to DoT

By Antonio Gozain | Fri, 09/02/2022 - 18:00

Expecting Mexico’s airspace to regain the Category 1 rank soon, ultra-low-cost carriers (ULCCs) Allegiant and Viva Aerobus submitted a new proposal to the US Department of Transportation (DoT) to expedite the approval of a cross-border joint venture.

The partnership between both carriers, which was announced in December 2021 as a fully-integrated Commercial Alliance Agreement, was designed to “dramatically expand options for nonstop leisure air travel between the US and Mexico, while lowering fares to make travel more accessible and affordable for residents of both nations,” according to Viva Aerobus. The alliance represents the first such venture for Las Vegas-based Allegiant and the Mexican carrier, in addition to a first-of-its-kind partnership in the airline industry between two ULCCs.

Once Antitrust Immunity (ATI) is obtained and Mexico’s Federal Civil Aviation Agency (AFAC) regains the US Federal Aviation Administration’s (FAA) Category 1 classification, Viva Aerobus and Allegiant aim to expand nonstop routes between Mexico and the US. Thus, offering greater point-to-point travel options, in contrast to most of legacy carriers’ flights.

“Allegiant and Viva Aerobus operating together will be a tremendous win for consumers seeking affordable, nonstop travel between the US and Mexico, and will create rippling economic benefits for hospitality sector business across both nations,” said Maurice Gallagher, CEO and Chairman, Allegiant Air, back in December 2021. “This groundbreaking alliance should reduce fares, stimulate traffic and ultimately link many new transborder cities with nonstop service. In short, it will bring meaningful ULCC competition to the US-Mexico market for the first time in history,” he added.

Allegiant is the only US-based airline focused entirely on leisure travel. Currently, it offers service to over 130 cities across the US but does not fly to Mexico. On the other hand, Monterrey-based Viva Aerobus offers extensive service across the latter country, in addition to nonstop flights to certain destinations in the US and Latin America. The Alliance Agreement will give Allegiant access to popular vacation destinations in Mexico, such as Cancun, Puerto Vallarta and Los Cabos. Meanwhile, Viva Aerobus will have access to Allegiant’s distribution network, growing its US customer base.

Allegiant plans to share routes with Viva Aerobus as the operator initially, following an estimated investment by the US airline of US$15 million to improve its computer systems and start its own flights to Mexico in 2025, reported Aviacionline. Viva Aerobus’ initial plans include nonstop services to the US from Tampico, Queretaro, Torreon, Merida, Guadalajara, Mexico City, Chihuahua, Veracruz, Monterrey and Morelia.

Antonio Gozain Antonio Gozain Journalist and Industry Analyst