Latin American carriers Avianca Holdings and Copa Airlines have reached an agreement with Chicago-based United Airlines on a proposed joint business agreement (JBA) plan.

If the plan gets government approval, it is expected to drive significant traffic growth at major gateway cities throughout Latin America and spur related new investment and economic development opportunities in the region.

The regulatory approval process is expected to take between 12 and 18 months, the companies said. In a Nov. 30 statement, the three airlines said they plan to apply for regulatory approval of the agreement and an accompanying grant of antitrust immunity from the US Department of Transportation and other regulatory agencies. The parties will fully implement the JBA after receiving the necessary government approvals.

The JBA currently includes cooperation between the US and Central and South America, excluding Brazil. With the recently concluded Open Skies agreement between the US and Brazil, the carriers are exploring the possibility of adding Brazil to the JBA.   

“Once approved, the JBA will enable deep commercial and strategic cooperation that will apply exclusively in the itineraries between Latin America and the US. contemplated in the agreement, but each of the three airlines will remain independent companies,” the statement said.

The carriers said they anticipate the JBA will provide customers with expanded codeshare flight options, competitive fares and a more streamlined travel experience.

“This agreement represents the next chapter in U.S.-Latin American air travel,” United president Scott Kirby said. “With our Star Alliance partners [Panama-based] Copa and [Colombia-based] Avianca, [we will] bring much-needed competition and growth to many underserved markets while providing a better overall experience for business and leisure customers traveling across the Western Hemisphere.”

“[The JBA] further [solidifies] our existing partnership with United Airlines; [and we] look forward to increasing service options for our customers by working more closely with Avianca,” Copa CEO Pedro Heilbron said. “We believe this agreement benefits our passengers by providing competitive fares and a superior network of more than 275 destinations throughout Latin America and the US, and promotes tourism and investment in our region.”

“We are certain that together we are stronger in the United States-Latin America market than any of the three airlines individually,” Avianca executive president and CEO Hernan Rincon said. “This partnership will allow Avianca to strengthen its position as a first-level player in the airline industry in America, as we will expand our scope in the continent with United and Copa, offering better connectivity to our customers.”

Mark Nensel