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LATAM to leave Oneworld alliance

Latin America group carrier LATAM Airlines Group plans to leave the Oneworld alliance.

In a statement, the alliance says it received an advisory from LATAM of its decision to partner with a non-member airline and to leave Oneworld "in due course and in accordance with formal contractual requirements."

"We are disappointed, but we respect their decision. They have been a valued long-term member of the alliance, and we wish them well."

LATAM's decision to leave Oneworld comes after Delta Air Lines announced that it will invest $1.9 billion in LATAM, representing a 20% stake in the company.

As part of the deal, Delta will buy four Airbus A350s from LATAM and assume the Chile-based group's commitment to acquire 10 additional A350s that will be delivered from 2020 onwards. It will also obtain seats on LATAM's board, and invest an additional $350 million in the partnership.

Soon after Delta's announcement, fellow Oneworld member American Airlines issued a statement saying that it understands LATAM’s decision to partner with a US carrier that isn’t burdened by "a recent negative ruling by the Chilean Supreme Court, which would have significantly reduced the benefits of our partnership since Chile was not approved as a part of the potential joint business arrangement."

American and LATAM had been applying for a joint venture and had run into snags in a Chilean court in May. American and LATAM dropped Chile from the application in August.

LATAM became a Oneworld alliance member in 1999, through Chilean component carrier LAN Airlines at that time. Over the 20 year membership, other component carriers based in Argentina, Brazil, Colombia, Ecuador, and Peru joined Oneworld. The LAN carriers eventually rebranded themselves into LATAM Airlines Group around 2015.

"Oneworld remains a strong coalition of high-quality airlines," says the alliance in its latest statement. "There has been significant progress in member airlines deepening their bilateral relationships, as evidenced by the recent regulatory approval of the American Airlines and Qantas joint business."

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