Mexico and Washington are coming to blows over codesharing, prompting calls for changes in their bilateral.
Discussions were set to resume in December but, according to one Washington source, 'they're talking, but they don't seem to be getting anywhere'.
The current US-Mexico bilateral makes no provision for codesharing and generally limits airlines to one designated carrier per country on each trans-border route. But both countries have been reasonably lenient about granting extra-bilateral rights on a case-by-case basis when airlines have sought double designation or codesharing authority on specific routes. However, the Mexicans have been less willing to approve more than two carriers per side on any city-pair since Mexico only has two major airlines.
With that as an added incentive, the number of US requests for codesharing has multiplied. Delta now codeshares with Aeromexico on most trans-border flights and United has numerous codeshares with Mexicana. American also recently applied to codeshare with AeroCalifornia on no fewer than 1,000 US-Mexico routes.
But the flood of US applications has prompted Mexican authorities to declare that a codeshare flight uses up a designation. For instance, if both countries agreed on double designation between Los Angeles and, say, Mexico City, Delta's codeshare with Aeromexico would consume one of the two US designations, even if Delta's flight was operated by Aeromexico.
The move by the Mexican authorities prompted the US Department of Transportation to declare that any airline serving a US-Mexico route only on a codeshare basis could have its authority suspended if a competing US airline proposed to fly that route with its own aircraft.
Continental has decided to try out the new policy on the San Antonio-Mexico City route. United Airlines already serves the route on a codeshare basis with Mexicana operating the flight. Continental has applied to start flying its own aircraft before the end of December.
United's response has been to suggest that DOT seeks Mexico's approval for an additional designation. Continental counters that DOT should first rescind United's codeshare authority and allow Continental to fly its own aircraft. That, argues Continental, would persuade Mexicana to lend its support to another designation so that it can regain the benefit of codesharing with United. At presstime DOT's decision was still pending.
Washington's immediate goal is to reverse Mexico's stance that a codeshare uses up a designation. Ultimately, the US would like to amend the bilateral and liberalise designations so much that Mexico's codeshare stance no longer matters. But that is a longer term, more ambitious goal.
Source: Airline Business