Delta Air Lines, Aeromexico To Partner On Cargo Network

Delta Air Lines (NYSE:DAL) and its Mexican counterpart Grupo Aeromexico signed a joint cooperation agreement on Jun 6, to boost their cargo operations across the United States and Mexico.

The deal will offer customers to choose either of the carriers to transport cargo over a wide range of flights and joint trucking options. The carriers have co-located warehouses in Mexico, Boston, New York-JFK, Miami, San Francisco and Chicago. Warehouses in Orlando and Detroit are expected to open this summer.

The agreement will also allow the two companies execute joint sales and marketing initiatives in their respective countries.

The partnership aims to provide a seamless logistics experience to customers on the U.S.-Mexico route. Also according to Rafael Figueroa, CEO, Aeromexico Cargo, the Aeromexico and Delta partnership is the largest and most extensively growing air cargo network in the U.S.-Mexico market.

To facilitate US- Mexico travel, the carriers recently inked a joint cooperation agreement (JCA) to operate flights connecting the nations. As part of the JCA, the carriers intend to launch five flights targeting new markets namely, Atlanta - Merida, Atlanta - Queretaro, Los Angeles - Leon, Seattle - Mexico City, Portland, OR - Mexico City.

Apart from adding new routes, they aim to increase flight frequency in four of the existent markets and use more modern aircrafts in two of them, respectively. These measures aimed at facilitating travel between nations, might be implemented as soon as this fall, subject to government clearance.

Zacks Rank & Key Picks

Delta currently carries a Zacks Rank #3 (Hold). Better ranked stocks in airline space are Air France-KLM SA (OTC:AFLYY) , Deutsche Lufthansa (DE:LHAG) AG (OTC:DLAKY) and Hawaiian Holdings, Inc. (NASDAQ:HA) . All sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Air France-KLM, Deutsche Lufthansa and Hawaiian Holdings gained over 63%, 41% and 6% respectively, over a period of three months.

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