Delta investing in airline partners is nothing new, as the airline owns stakes in Air France-KLM, China Eastern, LATAM, Virgin Atlantic, and more. In May 2025, Delta’s latest investment strategy was announced, but with a twist. This deal has now been finalized, and it has some major implications for Canadian aviation.
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Three SkyTeam airline groups buy 25% stake in WestJet
Delta, Korean Air, and Air France-KLM, have purchased minority equity stakes in WestJet from Onex Partners (the upper middle market private equity platform of Onex, a Canadian investor and alternative asset manager). This is part of a plan for the airline groups to strengthen their partnership with the Canadian airline.
As it’s described, these investments build on each airline’s existing relationship with WestJet, to provide further benefits to customers in North America, Europe, Asia, and beyond.
This deal has now been finalized, and with this, we’ve seen Delta and Korean Air independently acquire stakes totaling 25% in WestJet. Delta invested $330 million for a 15% stake, while Korean Air invested $220 million for a 10% stake.
Then Delta sold and transfered a 2.3% stake in WestJet to its joint venture partner Air France-KLM, in exchange for $50 million. While Air France-KLM is acquiring the smallest stake here, it’s worth noting that the group’s CEO, Ben Smith, has been on WestJet’s board since 2021.
Delta, Korean Air, and Air France-KLM, have had codeshare partnerships with WestJet for years. The plan is for there to be an elevated partnership, with “more seamless travel experience for customers worldwide.”
Here’s how Delta CEO Ed Bastian describes this investment:
“Investing in a world-class partner like WestJet aligns our interests and ensures that we remain focused on providing a world-class global network and customer experience for travelers in the United States and Canada. Together, Delta and our airline partners are connecting the world and transforming the future of travel.”
Here’s how Korean Air CEO Walter Cho describes this:
“We are pleased to invest in WestJet as part of our continued commitment to enhancing transpacific connectivity. This strategic partnership will enhance our global network and create long-term value for customers through greater choice and convenience.”
Meanwhile here’s what WestJet Board Director Tawfiq Popatia had to say:
“Our new partners are widely regarded as among the best-performing and most innovative airlines in the world. This investment has created a terrific amount of value for Onex Partners and its investors to date, including through the unprecedented headwinds posed by the pandemic. We look forward to building on this track record for all of WestJet’s investors, both new and continuing.”
What’s the logic for this WestJet investment?
This partnership makes perfect sense in the context of how Delta does business. Delta takes a unique approach to its airline partnerships. If Delta wants to have a close partnership with another airline, it doesn’t just start a joint venture, but it also often acquires a stake in the airline, so that it’s fully invested.
Meanwhile Delta generally couldn’t care less about its non-joint venture and non-equity partners, which it almost views as a nuisance. With that in mind, WestJet has had an interesting arrangement with Delta for quite some time. Delta and WestJet had been pursuing a transborder joint venture, but it ended up being called off, due to too many concessions being required.
Nonetheless, Delta has clearly remained very interested in WestJet, and it has kept its “preferred” status with Delta, despite the lack of a joint venture. So I imagine that this has been in the works for quite some time, or else Delta wouldn’t have remained so interested (unrelated, but I’d similarly expect Delta to invest in EL AL at some point, given its current relationship with the airline).
In and of itself, a minority stake doesn’t give Delta control over WestJet. However, Delta is a successful airline, and as you’d expect, airlines that Delta invests in are generally pretty cooperative with the airline. The interesting twist here is that Korean Air and Air France-KLM have also acquired a stake in the airline. Therefore this seems to be a global strategy for Delta and two of its closest partner airline groups.
So, what’s the strategy here? When you look at the current reality of aviation in Canada, you have Air Canada as the major global airline, and it’s part of the Star Alliance transatlantic joint venture. While WestJet has a respectable network, it has been heavily centered around Calgary (YYC), and the long haul network hasn’t necessarily been that big.
With Delta, Korean Air, and Air France-KLM, now investing in WestJet, I suspect we’re going to see material growth. WestJet recently placed a huge order with Boeing for more 787-9s and Boeing 737 MAX 10s.
While I think the airline will remain committed to Calgary, I have to imagine much of the growth will be at other airports, and we’ll see WestJet’s business model also focus a little more around connecting to the hubs of the other airlines. We’ll also see expanded long haul service.
WestJet already has a good amount of service to Delta hubs, and flies to Seoul Incheon and Paris Charles de Gaulle. However, don’t be surprised to see even more of a focus on this kind of flying, including out of additional Canadian airports. This seems like a win-win arrangement, which will increasingly allow WestJet to compete against Air Canada on a more global scale.
Will WestJet join SkyTeam, given that it’s getting an investment from three SkyTeam airline groups? It absolutely could happen, but I wouldn’t count on it. Keep in mind that Delta tends to have a pretty dominant position in these situations, and Delta doesn’t really care much about SkyTeam. For example, Delta owns a major stake in LATAM, and while LATAM left oneworld, there are no plans for the airline to join SkyTeam.
Anything could happen, but it’s interesting to see how Canadian airlines are now aligning — Star Alliance has Air Canada, WestJet is increasingly aligning with SkyTeam airlines, and Porter is increasing aligning with oneworld airlines.
Bottom line
Delta, Korean Air, and Air France-KLM, have just completed their investment in WestJet, acquiring a combined stake of 25%. This is in line with Delta’s strategy of investing in its most important partners, and it means that we’ll likely see the airlines work even more closely together. What’s interesting here is how this was a coordinated effort, with Korean Air and Air France-KLM.
I feel like there’s a lot of upside here for WestJet, so I look forward to seeing how this evolves in the coming years.
What do you make of this WestJet investment?
WestJet is awful. Just awful. I have to fly them twice a year into Canadian markets. The lounge in Calgary is at best an average Priority Pass lounge. And remarkably, they lack a lounge in Toronto. WestJet can't decide if it's a low-cost airline or a flag carrier.
All in all - good news for using KLM points. Me and my family often use KLM miles to book WestJet regional hops, which can get expensive, but cost only 5K - 6K KLM miles, and availability is massive in Y, with most flights having Y reward seats even shortly before departure.
I hope now that WJ starts providing reward space to partners in J on their 789 and domestic Premium cabin.
Delta and Korean each has a 25% stake in Westjet and has been for many months even as long as a year. That said I am not understanding your message.
Canada has a protected aviation market, but could the current Prime Minister change that, allowing foreign airlines more slots, more routes, more frequencies? Unfettered access to the routes they would like? Could US airlines start flying Canadian domestic routes? This little Westjet deal would have been forbidden under many past regimes in Ottawa. Is it a sign? Will Canada become the Aviation "51st State"?
One can see the appeal, to an American aviation exec. Congrats...
Canada has a protected aviation market, but could the current Prime Minister change that, allowing foreign airlines more slots, more routes, more frequencies? Unfettered access to the routes they would like? Could US airlines start flying Canadian domestic routes? This little Westjet deal would have been forbidden under many past regimes in Ottawa. Is it a sign? Will Canada become the Aviation "51st State"?
One can see the appeal, to an American aviation exec. Congrats Delta on this incremental step. But filling up our skies with Americans doing our jobs isn't the plan.
I hope this deal leads to Westjet becoming something. Now, they're a LCC with lipstick. One can hope that another Canadian airline can offer something as good as foreigners offer, including loyalty rewards, Alliance connectivity, premium cabins. Only AC, whatever its faults, does that. This deal doesn't change that.
I doubt Canada is going to allow US airlines to fly intra-Canadian routes. Surely that runs the risk of Canadian airlines going bust and the country then relying on US airlines, which I doubt is a vote winner. And I can’t see the US allowing domestic competition from Canadian airlines.
That's a lot of money for Delta to commit at this time. They are struggling against United. They will need their lawsuit against Delta Hotels to be successful to pay for this expense.
I don't get why Delta sees itself as a premium airline and yet invests in an airline that will create a section with seats that do not recline. In a similar vein, I asked myself why Delta would partner with China Eastern when the cockpit crew smoked during the flight I was on. No consistency in "premium" offerings.
Reclining seats are highly overrated, especially on short haul flights. Most airlines (even Delta) these days have reduced seat pitch such that it has become rude to recline (at least very much), even in first class. If the person behind you is trying to work on a laptop, reclining can make that nearly impossible. It makes it difficult even to get out to the aisle from one's seat. If everyone is sleeping, e.g., on a...
Reclining seats are highly overrated, especially on short haul flights. Most airlines (even Delta) these days have reduced seat pitch such that it has become rude to recline (at least very much), even in first class. If the person behind you is trying to work on a laptop, reclining can make that nearly impossible. It makes it difficult even to get out to the aisle from one's seat. If everyone is sleeping, e.g., on a redeye or long international route, recline makes more sense. Regardless, it's not my first criterion for judging an airline.
Fantastic news.
Hopefully they keep growing, as does Porter.
We need competition up here, and any business taken away from AC is a good thing.
WestJet has become a western Canadian airline with a presence in the eastern vacation market primarily to Mexico and the Caribbean in the winter. The pullback from the eastern hub at Toronto cedes the European market there largely to Air Canada and Air Transat. This has not been a good thing for competition so any move that would introduce a greater presence in Toronto (capital infusion and larger fleet) and other eastern hubs would be...
WestJet has become a western Canadian airline with a presence in the eastern vacation market primarily to Mexico and the Caribbean in the winter. The pullback from the eastern hub at Toronto cedes the European market there largely to Air Canada and Air Transat. This has not been a good thing for competition so any move that would introduce a greater presence in Toronto (capital infusion and larger fleet) and other eastern hubs would be a good thing. The culture at Westjet has changed significantly of late, and many say not for the better.
Is there gate space for WS to come back to Toronto after they pulled back? Seems like Porter took a lot of their former space at YYZ.
Sounds good to me. $600 million for a 25% stake. So, I guess, they 'value' Westjet at $2.4 billion.
Sheesh, a lot of these numbers are really just made up at the end of the day. Would be a shame if all of the sudden our 'human construct' of the 'economy' were 'bubble' or something... Anyway, I hear 'artificial intelligence' is all the buzz, like 'crypto' and 'blockchain' and 'Fintech' and 'an app for...
Sounds good to me. $600 million for a 25% stake. So, I guess, they 'value' Westjet at $2.4 billion.
Sheesh, a lot of these numbers are really just made up at the end of the day. Would be a shame if all of the sudden our 'human construct' of the 'economy' were 'bubble' or something... Anyway, I hear 'artificial intelligence' is all the buzz, like 'crypto' and 'blockchain' and 'Fintech' and 'an app for everything' and 'dot com' and 'radio' and... whatever that crazy 'Gutenberg' is up to. Anyway, we should all probably 'get in on this'... what do we have to lose!
Could LATAM really join Skyteam without the approval of their major competitor Aerolíneas Argentinas?
Aerolineas Argentinas would have no say in that. The only four carriers in SkyTeam with veto authority are Delta, Air France, AeroMexico, and Korean Air.
However, it would need a sponsor carrier though, and then there's also the question of which LATAM would even join.
LATAM is not one airline, but a combination of several separate carriers operating under joint marketing.
So would LATAM Chile (the former LAN) join?
Or would LATAM...
Aerolineas Argentinas would have no say in that. The only four carriers in SkyTeam with veto authority are Delta, Air France, AeroMexico, and Korean Air.
However, it would need a sponsor carrier though, and then there's also the question of which LATAM would even join.
LATAM is not one airline, but a combination of several separate carriers operating under joint marketing.
So would LATAM Chile (the former LAN) join?
Or would LATAM Brasil (the former TAM) join?
LATAM Colombia? LATAM Peru? LATAM Paraguay? LATAM Ecuador?
Every single one of these is a completely separate operational certificate, flagged in a different country, controlled by a different CAA's authority, and subjected to different route/bilateral/accesses.
Trying to bring them all into SkyTeam would be a logistical nightmare; and bringing just 1 or 2, but not the others, could be more confusing to both passengers and corporate clientele alike, that it's just not worth it.
It's speculative, but that's my best guess on why it hasn't happened, and doesn't appear to be on a path to happening.
@ConcordeBoy--the complexities you describe for LATAM's joining SkyTeam would make more sense if they had never been in another alliance. How did this work when they were in oneworld? Which of the several companies that make up LATAM were/were not in that alliance?
Ben, what does "upper middle market private equity platform" mean?
"Middle market" refers to an ill-defined set of privately held companies between large corporations and truly small businesses. Broadly, with revenues/values of $5 million on the low end to perhaps $3 billion on the high end. The middle market is stratified into bands, with the upper middle market being roughly $500 million to $3 million depending on who one asks. The "platform" is an investment firm's means to access such companies.
It means Ben cut and pasted from the press release. Onex is an also-ran private equity sponsor.
Jack gets it.
Scudder, it means 'made-up corporate-speak.'
Private equity can value anything whatever it wants and there are never any audits. Ripe for fraud. We're re-living the lead-up to 1929. Start speculating on-margin. What could possibly go wrong. Eat the corn seed. It's delicious!
Hear! Hear!