American Airlines & JetSMART Enter Strategic Partnership

July 30, 2021

American Airlines - JetSMART Agreement

American Airlines has signed an agreement with JetSMART that would bring together two wildly different airlines - AA's full service experience paired up against JetSMARTs ultra-low cost offering throughout Central/South Americas on routes previously not covered by either airline before this deal was made public.

This partnership will provide travelers across North and South America more options for affordable flights from cities like New York City to Santo Domingo or Santiago de Chile.

JetSMART is a portfolio airline of Indigo Partners that operates out of Chile and Argentina, one of the world’s premier developers of new generation ultra-low-cost airlines.

JetSMART operates a fleet of Airbus A320 planes and offers short-haul domestic and international service to 33 destinations throughout South America.

American has served Latin America since 1942 and offers service to 17 destinations in South America from its U.S. hubs in Dallas-Fort Worth, Miami and New York. Through the two airlines’ codeshare, the goal is to offer customers seamless travel throughout the Americas.

“This proposed investment in JetSMART would give customers access to the largest network, lowest fares and best travel loyalty program in the Americas,” said Vasu Raja, American’s Chief Revenue Officer. “This would enable JetSMART and American to grow aggressively and profitably across Latin America as demand recovers, while preserving the best aspects of each carrier’s business model. This partnership would also make AAdvantage the largest travel loyalty program in the Americas, creating more ways for customers to earn travel rewards and use their miles to access new destinations and elite benefits globally, no matter whether they earn in Latin or North America.”

Bill Franke, Founder and Managing Partner of Indigo Partners:

“We look forward to working with American to continue delivering low fares and customer choice throughout South America.”

Estuardo Ortiz, Chief Executive Officer of JetSMART, added, “By connecting and growing our respective networks, and maintaining our distinct business models, we see a compelling value proposition. When completed, this proposed partnership would accelerate JetSMART’s path to becoming the leading South American low-cost carrier while expanding service for American’s customers.”

Under the proposed transaction, American would invest in JetSMART to facilitate growth and give American a minority ownership stake in the short-haul South American carrier. Additionally, American and Indigo Partners would jointly commit to provide additional capital to fund potential future opportunities in the region. 

[Source: American Airlines]

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