LATAM to Leave Oneworld Alliance = Devaluation of BA Avios

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It was announced last night that pan-South American airline LATAM is going to leave the oneworld alliance, as a result of SkyTeam member Delta purchasing a 20% stake.

Oneworld released the following statement about the situation:

“LATAM advised oneworld earlier today of their decision to partner with an airline outside of the oneworld alliance. LATAM further advised oneworld that they intend to leave the alliance 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.

Our priority at this time is to our customers and while LATAM remains a member of 
oneworld, the full customer benefits will continue to be delivered. As the transition continues, we will work to ensure a seamless experience for our customers.

oneworld remains a strong coalition of high-quality airlines. 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.

British Airways Avios devalued

From a UK perspective, the real story here is that the value of Avios has indirectly just taken a hit.

Cash fares for flights in some parts of South America can be surprisingly expensive for those of us used to European low cost carriers. Being able to use Avios on LATAM throughout the region is a great way to save money, even on Economy tickets. That option will be going away whenever LATAM officially leaves oneworld.

Naturally, the ability to earn Avios and BA Executive Club Tier Points from LATAM flights will also be removed.

Do note though that LATAM hasn’t actually left oneworld yet. There are numerous contractual aspects that have to be fulfilled first, so for now you can still earn and redeem Avios.

Bottom line

On a personal note, I have a soft spot for LATAM (formerly LAN). The first time I ever used Avios to treat a friend to Business Class was when we needed to get from Santiago to Buenos Aires quickly, and there was only Business Class LAN availability left. I hadn’t been collecting points/miles very long at that point and although the hit to my meagre Avios balance stung, it was well worth it!

As nice as being able to use points and miles to fly in comfort and luxury by yourself is, sharing the experience with friends and family and seeing their reactions makes it much more special.

Will you miss LATAM?

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