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Australian regulators cleared a joint venture between Virgin Blue and US airline Delta on Pacific flights to the United States, ramping up competition on one of the world's most lucrative routes.
The Australian Competition and Consumer Commission (ACCC) said the carriers would be allowed to coordinate their pricing, scheduling and capacity.
"The ACCC considers that the joint venture is likely to assist Virgin and Delta to compete more effectively against the incumbents on the route -- Qantas and United Airlines," ACCC chairman Graeme Samuel said late Thursday.
"The joint venture is likely to give rise to route connectivity benefits for consumers, enhanced route coverage and schedules, and more sustainable competition on the route," he added.
The ACCC said cost benefits were also expected to flow onto the carriers' local services, with an incentive to offer cheap onward domestic flights in order to sell tickets.
The venture's implementation was conditional on the pair winning anti-trust immunity from US authorities.
Qantas and United Airlines have long dominated flights between Australia and the US.
A fierce discounting war broke out when Delta, the world's biggest airline, entered the market in July, with fares touching all-time lows.
V Australia, the international offshoot of budget carrier Virgin, has been operating on the route since February this year.
