Airlines seeking waiver of January 1 deadline so court can review
US government calls the joint venture "legalized collusion"
US also took other actions last week against Mexican carriers
Writes through with details of the case
By David Shepardson
WASHINGTON, Nov 3 (Reuters) - The Trump administration asked a U.S. appeals court on Monday to reject Delta Air Lines DAL.N and Aeromexico's bid to halt an order forcing them to unwind a venture that lets the carriers coordinate scheduling, pricing and capacity for U.S.–Mexico flights.
The airlines are seeking to have waived a January 1 deadline to end their venture as ordered by the Department of Transportation, so that the court can have time to conduct a review and issue a full opinion. The order was issued in September, as part of several actions aimed at Mexican aviation.
In a filing by the Departments of Transportation and Justice, the government called the venture "legalized collusion" that controls "almost 60% of operations at the fourth-largest international gateway to and from the United States," citing Mexico City flights.
Aeromexico has told the 11th Circuit Court of Appeals it would face substantial costs it could not recover even if a court later upheld the arrangement. Delta has also made a similar claim.
The government said the airlines' claims "of irreparable injury are overblown. And the public interest favors restoring full and fair competition between Delta and Aeromexico themselves and among them and their competitors."
The airlines did not immediately respond to requests for comment following the government filing.
Delta, which has a 20% stake in Aeromexico, has also argued that the government is holding the joint venture to a stricter standard than other ventures including United Airlines UAL.O and ANA 9202.T.
The government has said anticipated problems from the venture include higher fares in some markets, reduced capacity and challenges for U.S. carriers due to inadequate competition.
In separate actions last week, the Trump administration revoked approval for 13 routes by Mexican carriers into the United States and canceled all combined passenger and cargo flights by Mexican airlines to the United States from Mexico City's Felipe Angeles International Airport.
Transportation Secretary Sean Duffy said Mexico "illegally canceled and froze U.S. carrier flights for three years without consequences."
Mexican President Claudia Sheinbaum said last week she disagrees with the U.S. decision to revoke approval of the 13 routes.
(Reporting by David Shepardson; Editing by Edwina Gibbs)
((David.Shepardson@thomsonreuters.com; 2028988324;))