Capturing and Delivering Value in the Trans-Atlantic Air Travel Market: The Case of the Air France-KLM, Delta Air Lines, and Virgin Atlantic Airways Strategic Joint Venture

Glenn Baxter


This paper presents a case study of the Air France-KLM, Delta Air Lines, and Virgin Atlantic transatlantic joint venture, one of the world’s largest strategic passenger joint ventures. The study used a qualitative research approach. The data gathered for the study was examined by document analysis. The strategic analysis of the joint venture was based on the use of Porter’s Five Forces Model. The study found that the joint venture has evolved over time through the addition of KLM Royal Dutch Airlines, Alitalia, and Virgin Atlantic Airways to the original joint venture between Air France and Delta Air Lines. The joint venture has provided significant synergistic benefits to the partners and has allowed the partners to access new markets and to participate in the evolution of the transatlantic air travel market, one of the world’s major air travel markets. The joint venture has also enabled the venture partners to enhance their competitive position through strengthened service offerings, a comprehensive route network that offers customers a high level of connectivity, and greater flight frequencies within their own route networks, all of which creates value for the partners. A limitation of the study was that the annual revenue, revenue passenger kilometres performed, or passenger load factors data was not available. It was, therefore, not possible to analyze the business performance of the joint venture.


Air France-KLM, airlines, alliances, case study, Delta Airlines, joint venture, KLM Royal Dutch Airlines, Porter’s Five Forces Model, Virgin Atlantic Airways


Glenn Baxter. AERO2322 Airline marketing topic 7 learning guide: strategic alliances. RMIT University, Melbourne, Australia, 2017.

Frank Berardino. Integrating airline strategy and marketing. In Gail F. Butler and Martin R. Keller, editors, Handbook of Airline Marketing, chapter 9, pages 105-116. McGraw-Hill, New York, NY, 1998. ISBN 0-07-606813-7

Chandra Prakash Garg. A robust hybrid decision model for evaluation and selection of the strategic alliance partner in the airline industry. Journal of Air Transport Management, 52, 55-66, 2016.

Ian Douglas and David Tan. Global airline alliances and profitability: A difference-in-difference analysis. Transportation Research Part A: Policy and Practice, 103, 432-443, 2017.

Peter Smith Ring. The three T’s of alliance creation: Task, team and time. European Management Journal, I, 152-163, 2000.

Jani Kilpi and Ari P.J. Vepsäläinen. Pooling of spare components between airlines. Journal of Air Transport Management, 10(2), 137-146, 2004.

Birgit Kleymann and Hannu Seristö. Managing strategic airline alliances. Routledge, Abingdon, UK, 2016. ISBN 978-0754613275

Alan Fyall and Brian Garrod. Tourism marketing: a collaborative approach. Channel View Publications, Clevedon, UK, 2005. ISBN 978-1873150900

Kostas Iatrou and Mauro Oretti. Airline choices for the future: from alliances to mergers. Routledge, Abingdon, UK, 2016. ISBN 978-0754648864

Ahmed Abdelghany, Khaled Abdelghany. Modeling applications in the airline industry. Routledge, Abingdon, UK, 2016. ISBN 978-0754678748

Philip Shearman. Airline marketing: A great future, but different. In Gail F. Butler and Martin R. Keller, editors, Handbook of Airline Marketing, chapter 11, pages 131-139. McGraw-Hill, New York, NY, 1998. ISBN 0-07-606813-7

Tae Hoon Oum and Jong-Hun Park. Airline alliances: current status, policy issues, and future directions. Journal of Air Transport Management, 3(3), 133-144, 1997.

Fariba E. Alamdari and Peter Morrell. Airline franchising: brand extension or out-sourcing high-cost routes? In Gail F. Butler and Martin R. Keller, editors, Handbook of Airline Marketing, chapter 38, pages 503-512. McGraw-Hill, New York, NY, 1998. ISBN 0-07-606813-7

Y.C. Chang and C.J. Hsu. Ally or merge airline strategies after the relaxation of ownership rules. Proceedings of the Eastern Asia Society for Transportation Studies, 5, 545-556, 2005.

Rigas Doganis. The airline business. 2nd ed. Routledge, Abingdon, UK, 2006. ISBN 978-0415346146.

Michael Zea and David Feldman, D. Going global: the risks and rewards of airline alliance-based network strategies. In Gail F. Butler and Martin R. Keller, editors, Handbook of Airline Marketing, chapter 41, pages 545-549. McGraw Hill, New York, NY, 1998. ISBN 978-0415346146.

Aimin Yan and Yadong Luo. International joint ventures: theory and practice. M.E. Sharpe, Armonk, NY, 2001. ISBN 978-0765604743

All Nippon Airlines. Alliances that create value -the ANA Group’s alliance strategy for its international business. URL [Online].

Shane A. Johnson and Mark B. Houston. A reexamination of the motives and gains in joint ventures. The Journal of Financial and Quantitative Analysis, 35, 67–85, 2000.

A. Cemal Ekin and Thomas R. King. A struggling international partnership: TNK-BP joint venture. International Journal of Strategic Business Alliances, 1(1), 89–106, 2009.

Zenichi Shishido, Munetaka Fukuda and Masato Umetani. Joint venture strategies: design, bargaining, and the law. Edward Elgar Publishing: Cheltenham, UK, 2015. ISBN 978-1783475032

Luís Morais. Joint ventures and EU competition law. Hart Publishing: Oxford, UK, 2013. ISBN 978-1841137933

Charles W. L. Hill, Melissa A. Schilling, Gareth R. Jones. Strategic management: theory: an integrated approach; Cengage Learning: Stamford, CT, 2015. ISBN 978-1305502338

Azhar Kazmi. Strategic management and business policy. 3rd ed. Tata-McGraw Hill Publishing: New Delhi, India, 2008. ISBN 13: 978-0-07-026362-8

Kathryn Rudie Harrigan. Joint ventures, alliances, and corporate strategy. Beard Books, Washington, DC, US, 2003. ISBN 978-1587981951

Daniel F. Spulber. Economics and management of competitive Strategy. World Scientific Publishing: Singapore, 2009. ISBN 978-9812838469

Yanni Yan. International joint ventures in China: ownership, control and performance. Macmillan Press: London, UK, 2000. ISBN 978-0312223014

Ian Hewitt, L. Joint ventures, 3rd ed. Sweet & Maxwell: London, UK, 2005. ISBN 978-0421739802

Jeffrey S. Harrison. Alternative to merger-Joint ventures and other strategies. Long Range Planning, 20(6), 78–83, 1987.

Aimin Yan and Yadong Luo. International joint ventures: theory and practice; Routledge: Abingdon, UK, 2015. ISBN 13: 978-0765604743

Paul W. Beamish and Nathaniel C. Lupton. Managing joint ventures. Academy of Management Perspectives, 23(2), 75–94, 2009.

Sal Kukalis and Mark Jungemann. Strategic planning for a joint venture. Long Range Planning, 28(3), 4–57, 1995.

Randall Whyte and Gui Lohmann. Airline business models. In Lucy Budd and Stephen Ison, editors, Air transport management: an international perspective, chapter 7, pages 107-121. Routledge, Abingdon, UK, 2017. ISBN 9781472451064

Gui Lohmann and Bojana Spasojevic. Airline business strategy. In Nigel Halpern and Anne Graham, editors, The routledge companion to air transport management, chapter 9, page 139-153. Routledge, Abingdon, UK, 2018. ISBN 978-1138641372

Robert D. Hisrich, Mathew J Manimala, Michael P. Peters; Dean A. Shepherd. Entrepreneurship, 9th ed.; McGraw-Hill Education: New Delhi, India, 2012. ISBN 13-978-392-0538-6

Phil Harris and Frank McDonald. European Business and Marketing, 2nd ed. SAGE Publications Ltd.: London, UK, 2004. ISBN 9780761966043

Ursula F. Ott. International joint ventures: an interplay of cooperative and noncooperative games under incomplete information. Palgrave-Macmillan: Basingstoke, UK, 2006. ISBN 9780230625464

Keith W. Glaister, Rumy Husan and Peter J. Buckley. Strategic business alliances: an examination of the core dimensions. Edward Elgar Publishing: Cheltenham, UK, 2004. ISBN 1843761777

Levent Altinay, Alexandros Paraskevas and Soo Cheong Jang. Planning research in hospitality and tourism, 2nd ed. Routledge: Abingdon, UK, 2016. ISBN 9781138852259

International Air Transport Association. Strategizing for success. URL [Online].

Adrian Scholfield. Hub boost. Air Transport World, 55(2), 28-30, 2018.

Edward Russell. Delta and Korean move fast on JV. Airline Business, 34(9), 6, 2018.

Nigel Evans. Collaborative strategy: an analysis of the changing world of international airline alliances. Tourism Management, 22(3), 229-243, 2001.

Martin Bartlik. The impact of EU Law on the regulation of international air transportation. Routledge, Abingdon, UK, 2016. ISBN 9780754649519

A. K. Bhatia. The business of tourism: concepts and strategies. Sterling Publishers, New Delhi, India, 2007. ISBN 978-8120731189

Organisation for Economic Cooperation and Development. The future of international air transport policy: responding to global change. URL [Online].

Guillaume Burghouwt. Airline network development in Europe and its implications for airport planning. Routledge, Abingdon, UK, 2016. ISBN 9781138245730

Anming Zhang, , Yimin Zhang and Joseph A. Clougherty. Competition and regulation in air transport. In André de Palma, Robin Lindsey, Emile Quinet, and Roger Vickerman, editors, A Handbook of Transport Economics, chapter no. 35, pp. 797-821. Edward Elgar Publishing, Cheltenham, UK, 2011. ISBN 978-1783472857

Thomas Bieger and Andreas Wittmer. Airline strategy: From network management to business models. In Andreas Wittmer, Thomas Bieger and Roland Müller, editors, Aviation Systems: Management of the Integrated Aviation Value Chain, chapter no. 5, pages 77-102. Springer Verlag, Berlin, Germany, 2011. ISBN 3642200796

Gerald N. Cook and Bruce Billig. Airline operations and management: a management textbook. Routledge, Abingdon, UK, 2017. ISBN 9781138237520

Anne Graham and Peter Morrell. Airport finance and investment in the global economy. Routledge, Abingdon, UK, 2017. ISBN 978-1472440204

Rupa Tawari. Tourism management: managing for change. Global India Publications, New Delhi, India, 2009. ISBN 9789380228372

Rigas Doganis. Flying off course: airline economics and marketing. 4th ed. Routledge, Abingdon, UK, 2010. ISBN 9780415447379

Isabelle Lelieur. Law and policy of substantial ownership and effective control of airlines: prospects for change. Routledge, Abingdon, UK, 2016. ISBN 9781351922876

Dirk Morschett, Hanna Schramm-Klein and Joachim Zentes. Strategic international management: texts and cases. 2nd ed. Gabler Verlag, Wiesbaden, Germany, 2010. ISBN 978-3658078836

Thomas M Grubb and Robert B Lamb. Capitalize on merger chaos: six ways to profit from your competitors’ consolidation and your own. The Free Press, New York, NY, 2000. ISBN 068486777X

Marion M. Bennett. Strategic alliances in the world airline industry. Progress in Tourism and Hospitality Research, 3(3), 213-223, 1997.;2-C

James P. Hanlon. Global airlines: competition in a transnational industry, 3rd ed. Butterworth-Heinemann, Oxford, UK, 2007. ISBN 978-0750664394

James Rajasker and Paul Fouts. Strategic alliances as a competitive strategy: How domestic airline use alliances for improving performance. International Journal of Commerce and Management, 19(2), 93-114, 2009.

Stephen Holloway. Straight and level: practical airline economics. 3rd ed. Routledge, Abingdon, UK, 2016. ISBN 9780754672562

Gary Hamel, Yves Doz and C.K. Prahalad. Collaborate with your competitors – and win. Harvard Business. Review, 67(1), 133-139, 1989.

Sveinn Vidar Gudmundsson and Dawna L Rhoades. Airline alliance survival analysis: Typology, strategy and duration. Transport. Policy, 8(3), 209-218, 2001.

Andrew Inkpen and Kannan Ramaswamy. Global strategy: creating and sustaining advantage across borders; Oxford University Press, New York, NY, 2006. ISBN-13: 978-0195167207

Nigel Evans, George Stonehouse, David Campbell. Strategic management for travel and tourism. Routledge, Abingdon, UK, 2011. ISBN 13 9780750648547

Farok J. Contractor and Peter Lorange. Why should firms compete? The strategy and economic benefits for cooperative ventures. In Farok J. Contractor and Peter Lorange, editors, Cooperative Strategies in International Business, pages 3-30. Lexington Books, Lexington, MA, 1988. ISBN 9780080441276

David Ahlstrom and Garry D. Bruton. International management: strategy and culture in the emerging world. South-Western Cengage Learning: Mason, OH, 2010. ISBN 9780324406313

Michael E. Porter. Competitive strategy: techniques for analyzing industries and competitors with a new introduction. The Free Press: New York, NY, 2008. ISBN 0684841487

Michael E. Porter. How competitive forces shape strategy? In Cynthia A. Montgomery and Michael E. Porter, editors, Strategy: Seeking and Securing Competitive Advantage, chapter 2, pages 11-25. Harvard Business School Publishing: Moston, MA, 1991. ISBN 0-87584-243-7

Figen Uçmak and Cansu Arslan. The impact of competition conditions on new market entrants in Istanbul Hotel Industry: An analyse by using five forces of competitive position model of M. Porter. Procedia - Social and Behavioral Sciences, 58, 1037-1046, 2012.

Süleyman Barutçu and Mustafa Zihni Tunca. The impacts of E-SCM on the E-tailing industry: an analysis from Porter's Five Force perspectives. Procedia - Social and Behavioral Sciences, 58, 1047-1056, 2012.

John. F. Rice. Adaption of Porter’s Five Forces model to risk management. URL [Online].

C Appa Rao, B Parvathiswara Rao and K Sivaramakrishna. Strategic management and business policy. Excel Books, New Delhi, India, 2008. ISBN 978-7446-523-5

Robert E. Stake. The art of case study research. SAGE Publications, Thousand Oaks, CA, 1995. ISBN 0803957661

John W. Creswell. Qualitative inquiry and research design: choosing among five approaches. 2nd ed. SAGE Publications, Thousand Oaks, CA, 2007. ISBN 978-1412995306

Robert. E. Stake. Qualitative case studies. In Norman K. Denzin and Yvonna S. Lincoln, editors, The SAGE Handbook of Qualitative Research, chapter 17, pages 443-466. SAGE Publications, Thousand Oaks, CA, US, 2005. ISBN 0-7619-2757-3

Glenn Baxter and Panarat Srisaeng. The strategic deployment of the Airbus A350-900XWB aircraft in a full-service network carrier route network: the case of Singapore Airlines. Infrastructures, 3(3), 25, 2018.

Bryman. Social research methods. 4th ed. Oxford University Press, Oxford, UK, 2012. ISBN 9780199689453

Abd Rahman Abdul Rahim and Mohd Shariff Nabi Baksh. Case study method for product development in engineer-to-order organisations. Work Study, 52(1), 25-36, 2003.

Robert K. Yin. Case study research and applications. 6th ed. SAGE Publications, Thousand Oaks, CA, 2017. ISBN 13: 978-1506336169

Glenn Baxter and Panarat Srisaeng. Cooperating to compete in the global air cargo industry: the case of the DHL Express and Lufthansa Cargo A.G. joint venture airline ‘AeroLogic’. Infrastructures, 3(1), 7, 2018.

J. Ramon Gil-Garcia. Enacting electronic government success: an integrative study of government-wide websites, organizational capabilities, and institutions. Springer Science-Business Media, New York, NY, 2012. ISBN 978-1-4939-0021-3

Helen Simons. Case study research in practice. SAGE Publications, London, UK, 2009. ISBN 978-0761964247

Briony J Oates. Researching information systems and computing. SAGE Publications, London, UK, 2006. ISBN 9781412902243

John Scott and Gordon Marshall. A dictionary of sociology. 3rd ed. Oxford University Press, New York, NY, 2009. ISBN 9780199533008

James Fulcher, John Scott. Sociology. 4th ed. Oxford University Press, Oxford, UK, 2011. ISBN 978-0-19-956375-3

Kristin Shrader-Frechette and Earl. D. McCoy. Community ecology, population biology, and the method of case studies. In David R. Keller and Frank B. Golley, editors. The philosophy of ecology: from science to synthesis, chapter 12, pages 153-169. University of Georgia Press, Athens, Greece, 2000. ISBN 978-0820322209.

Berta van Schoor. Fighting corruption collectively: how successful are sector-specific coordinated governance initiatives in curbing corruption. Springer VS, Wiesbaden, Germany, 2017. ISBN 978-3-658-17837-6.

O'Leary, Z. The Essential Guide to Doing Research. SAGE Publications, London, UK, 2004.

Colin Baker. Decision time. Airline Business, 19(8), 30-33, 2003.

Geoff Jones. Northwest Airlines: the first eighty years; Arcadia Publishing, Chicago, IL, 2005, ISBN 13: 978-0738534152

Stephen Shaw. Airline marketing and management. 6th ed. Ashgate Publishing, Aldershot, UK, 2007. ISBN 9781409401490

Jan Walulik. Progressive Commercialization of Airline Governance Culture. Routledge, Abingdon, UK, 2017. ISBN 9781138614246

Beaver, A. A Dictionary of Tourism and Travel; Oxford University Press, Oxford, UK, 2012.

Leick, R.; Wensveen, J.G. The airline business. In The Business of Transportation: Volume 1 Modes and Markets; Prokop, D., Ed.; ABC—CLIO, LLC, Santa Barbara, CA, US, pp. 65-99.

Colin Baker. Two’s company. Airline Business, 19(11), 30-32, 2003.

Colin Baker. Air France-KLM get merger approval. Airline Business, 20(6), 19, 2004.

Colin Baker. Joint vision. Airline Business, 20(7), 32-36, 2004.

Brendan Sobie. Air France-Delta extend partnership. Airline Business, 23(11), 11, 2007.

Air Transport World. Air France, Delta launch transatlantic JV. Air Transport World, 44(11), 10, 2007.

Brendan Sobie. SkyTeam completes slot shuffle. Airline Business, 24(10), 12, 2008.

David Gillen. Airport slots: A primer. In Achim I. Czerny, Peter Forsyth, David Gillen and Hans-Martin Niemeier, editors, Airport slots: international experiences and options for reform; chapter 4, pages 41-62. Routledge, Abingdon, UK, 2016. ISBN 9780754670421

Graham Dunn. Air France-KLM wins Alitalia race. Airline Business, 25(2), 15, 2009.

John T. Bowen. The economic geography of air transportation: space, time, and the freedom of the sky. Routledge, Abingdon, UK, 2010. ISBN 978-0415778053

Gunter Endres. Crisis management. Flight International, 175(5182), 38-40, 2009.

Consulate General of France in Atlanta. 10th anniversary of the Air France KLM and Delta Air Lines joint venture. URL [Online].

John Crawley. Delta buys Northwest to create biggest airline. URL [Online].

World Airline News. Alitalia joins the Air France-KLM-Delta Trans-Atlantic joint venture. URL [Online].

KLM Royal Dutch Airlines. Alitalia joins Air France-KLM Group, Delta Air Lines in industry’s leading Trans-Atlantic joint venture, Media Release 6 July 2010. URL [Online].

Edward Russell. Delta hones transatlantic aim. Airline Business, 29(5), 12, 2013.

Air Transport World. DOT tentatively approves Delta-Virgin transatlantic joint venture. Air Transport World, 50(10), 16, 2013.

Chris Tarry. Hasty deals lead to buyer’s remorse. Airline Business, 33(7), 46, 2017.

Robert Silk. Delta, Air France-KLM and Virgin Atlantic seek closer ties. URL [Online].

David Casey. Delta, Air France-KLM and Virgin to form Transatlantic alliance. URL [Online].

Air France-KLM. Air France-KLM, Delta Air Lines and Virgin Atlantic sign definitive agreements to strengthen Trans-Atlantic partnership. URL [Online].

Edward Russell. Tie-up intensifies transatlantic fight. Airline Business, 33(7), 8, 2017.

KLM Royal Dutch Airlines. Air France-KLM strengthens its strategic partnerships. URL [Online].

Delta Air Lines. Delta, Air France-KLM, Virgin Atlantic will launch combined joint venture. URL [Online].

Delta Air Lines. Delta, Air France-KLM and Virgin Atlantic sign agreements strengthening Trans-Atlantic partnership. URL [Online].

Vinay Bhaskara. Delta, Air France-KLM, Virgin Atlantic, and China Eastern announce blockbuster deals. URL [Online].

Edward Russell. Alitalia dropped from expanded Delta-Air France pact. URL [Online].

International Air Transport Association. Vision 2050. URL [Online].

Stephen Holloway. Straight and level: practical airline economics. 3rd ed. Ashgate Publishing, Aldershot, UK, 2008. ISBN 9780754672562

Michael Hanke. Airline e-commerce: log on. take off. Routledge, Abingdon, UK, 2016. ISBN 9780415775809

Jaap de Witt and Guillaume Burghouwt. Toward a more efficient use of airport capacity at Europe’s hubs. In Rosário Macário and Eddy Van de Voorde, editors, Critical issues in air transport economics and business; chapter 14, pages 234-250. Routledge, Abingdon, UK, 2011. ISBN 9781138880788

Bijan Vasigh, Ken Fleming and Thomas Tacker. Introduction to air transport economics: from theory to applications. 3rd ed. Routledge, Abingdon, UK, 2018. ISBN 9781138237759

Curtis M. Grimm, Hun Lee, Ken G. Smith. Strategy as action: competitive dynamics and competitive advantage. Oxford University Press, Oxford, UK, 2006. ISBN 10: 0195161440

William M. Pride, Robert J. Hughes and Jack R. Kapoor. Business. 12th ed. South-Western, Mason, OH, 2014. ISBN 978-1133595854

Doramas Jorge-Calderon. Aviation investment: economic appraisal for airports, air traffic management, airlines and aeronautics. Routledge, Abingdon, UK, 2014. ISBN 9781138270206

P.S. Senguttuvan. Principles of airport economics. Excel books, New Delhi, India, 2007. ISBN 81-7446-523-5

Martin Kunc. Strategic analytics: integrating management science and strategy. John Wiley & Sons, Hoboken, NJ, 2018. ISBN 9781118907184

Glenn Baxter. AERO2460 airport design and operations: topic 7 learning guide: aircraft ground handling, baggage handling and terminal operations. RMIT University, Melbourne, Australia, 2015.

Moshe Givoni and David Banister. Role of railways in the future of air transport. Transportation Planning and Technology, 30(1), 95-112, 2007.

Daniel Albalate, Germà Bel and Xavier Fageda. Competition and cooperation between high-speed rail and air transportation services in Europe. Journal of Transport Geography, 42, 166-174, 2015

Business Traveller Asia-Pacific. Ten airline joint ventures travellers ought to know about. URL [Online].

Stephen Shaw. Aviation marketing and the leisure market. In Anne Graham, Andreas Papatheodorou and Peter Forsyth, editors, Aviation and tourism: implications for leisure travel, chapter 4, page 35-47. Ashgate Publishing, Farnham, UK, 2010. ISBN

Barbara Peterson. Joon, Air France's new airline for Millennials, is now selling tickets. URL [Online].


  • There are currently no refbacks.

Copyright (c) 2019 Glenn Baxter

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.