Mexico-U.S air transport deal begins in bid to boost competition

August 21, 2016 12:49 PM EDT

Delta airplanes line up on the taxi way at Hartsfield Jackson Atlanta International Airport in Atlanta, Georgia, U.S. August 8, 2016. REUTERS/Tami Chappell

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MEXICO CITY (Reuters) - An air transport deal between Mexico and the United States that aims to boost competition in the passenger and freight sectors came into force on Sunday, Mexico's Communications and Transport Ministry said.

The deal, which modifies a 1960 agreement, would open new passenger routes for airlines to fly between the countries and allow for an unlimited number of flights. It also opens up the air freight market to more competition.

While some analysts have welcomed the deal, saying it would lower airfares by boosting traffic, Mexican airline workers have complained it would put their country's airlines at a disadvantage.

The deal removes the main hurdle to a closer tie-up between Delta Air Lines Inc and Grupo Aeromexico SAB de CV. The carriers have asked the U.S. government to grant them immunity from antitrust law so they can coordinate better flight connection times as well as prices, a request that cannot be granted until the aviation accord comes into force.

(Reporting by Gabriel Stargardter; Editing by Bill Trott)

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