Delta has recently declared that it has acquired almost 4.3% equity stake within Hanjin-KAL, which is the biggest shareholder of Korean Air. Delta plans to surge its equity stake in Korean Air up to 10% in the course of time despite having a pending regulatory approval. Korean Air and Delta had signed an agreement on May 2018. The basic plan of the joint venture is to provide the passengers with the right to use almost 80 destinations present in Asia and 290 destinations from the US. The present investment is an expansion based plan. CEO Ed Bastian of Delta has already made a statement regarding the investment strategy:
“Together with the team at Korean Air, we have a vision to deliver the world’s leading trans-Pacific joint venture for our shared customers, offering the strongest network, the best service and the finest experience connecting the U.S. with Asia. This is already one of our fastest-integrating and most successful partnerships, and experience tells us this investment will further strengthen our relationship as we continue to build on the value of the joint venture.”
United, American, and Delta have joint ventures. The joint venture lets them manage the pricing and also arranges with any more airlines so as to create a sturdy charisma in a market. It is still dizzy whether the passengers are going to benefit from it. Delta is quite different from its rivals as they have better control over the joint ventures. The company eyes for stronger joint ventures and at the same time invest in airlines they build a partnership with. The company owns a stake in Gol, Aeromexico, China Eastern, Virgin Atlantic, Korean Air, and Air France-KLM. In case of a partnership, the equity shares are not vital but it does give the power in building relationships. Earlier, Northwest was strongest in Asia but now it is definitely Delta. The partnership with Korean Air has only helped them grow and become a strong player in Asia.
Delta has cherishing news for the passengers that it is trying to focus on Incheon and thus, has many of its point-to-point routes canceled such as Seattle to Hong Kong. The joint venture is believed to lead to a higher cooperation level in a short time span.