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Avianca CEO sees little regulatory hassle with United JV

Avianca expects minimal regulatory hurdles for an imminent joint venture with United Airlines, citing the little network overlap between the two Star Alliance carriers.

“The US regulatory process could take nine months to a year, but also could happen earlier,” Avianca chief executive Hernan Rincon tells FlightGlobal on the sidelines of the ALTA Airline Leaders Forum.

Rincon does not expect the airlines to divest slots or routes to secure anti-trust immunity, saying: “We will of course consider any remedies that are needed… but our overlaps are much less [compared with other joint ventures].”

Avianca and United have reached a verbal agreement on a joint venture, and are in the process of finalising legal documents, says Rincon. He expects this to be completed by year-end.

FlightGlobal schedules data shows that the two airlines overlap directly on only one route: Houston Intercontinental to San Salvador. United serves Bogota, San Pedro Sula (Honduras) and San Salvador from Newark Liberty, while Avianca operates to the three Latin American cities from New York John F Kennedy.

Rincon declines to comment on specifics of the planned joint venture with United, but points out that like most joint ventures, the two airlines will co-ordinate flight timings and route planning.

Further down the road, Rincon sees more opportunities for United and Avianca to partner outside of the joint venture. These could include contracts for MRO work on United’s aircraft at Avianca’s facility in Medellin, or shared airport facilities such as check-in counters.

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