Delta and Korean Air Invest $550 Million in WestJet Amid US-Canada Travel Challenges; Tesla Shares Surge on US-China Trade Optimism

Delta Air Lines and Korean Air are investing $550 million to acquire a 25% stake in WestJet, aiming to enhance global connectivity amid US-Canada travel challenges. Delta will invest $330 million for a 15% stake, and Korean Air $220 million for a 10% stake. Meanwhile, Tesla shares rose nearly 5% on optimism over US-China trade talks, despite weak sales. US markets ended the week mixed, with President Trump suggesting a potential reduction in tariffs on Chinese goods, which influenced market sentiment.

Delta and Korean Air Strengthen Ties with WestJet

Delta Air Lines and Korean Air will acquire minority equity stakes in WestJet, totaling 25%, from Onex Partners and its affiliated funds. Delta will invest $330 million for a 15% stake, while Korean Air will contribute $220 million for a 10% stake. The transaction is designed to enhance the airlines’ global networks and improve customer connectivity across North America, Europe, and Asia.

The investment marks a renewed effort to solidify partnerships that had previously faltered. A proposed joint venture between Delta and WestJet was abandoned in 2020 after U.S. regulators required WestJet to relinquish key takeoff and landing slots at New York’s LaGuardia Airport. This new equity-based approach bypasses those regulatory hurdles while still aligning strategic interests.

Delta CEO Ed Bastian emphasized the importance of the deal in maintaining a robust international network. “This investment ensures that we remain focused on providing a world-class global network and customer experience for travelers in the United States and Canada,” Bastian said in a statement.

Korean Air Chairman and CEO Walter Cho echoed the sentiment, calling the partnership a step toward “long-term value for customers through greater choice and convenience.”

The Onex Group, which acquired WestJet in 2019, will retain control of the Calgary-based airline. Delta also has the right to transfer a 2.3% stake to its joint venture partner Air France-KLM for $50 million, pending regulatory approvals.

Deal Comes Amid Cross-Border Travel Decline

The timing of the investment is notable, as travel between Canada and the U.S. has been under pressure. Air Canada recently lowered its financial forecast for 2025, citing a 13% drop in transborder bookings over the next six months. CEO Michael Rousseau attributed the decline to political tensions, including U.S. tariffs and annexation rhetoric from President Trump.

“There’s definitely been a reaction,” said WestJet Vice Chairman Alex Cruz in March, noting that Canadian travelers are increasingly choosing destinations in Central America and Europe over the U.S.

Air Canada has responded by shifting capacity away from U.S. routes, including cutting flights to Florida, Las Vegas, and Arizona by 10% during the spring break season. The airline has also launched new routes to Edinburgh and the Philippines, while scaling back its overall capacity growth forecast from 3–5% to 1–3%.

The WestJet investment by Delta and Korean Air may help offset some of these challenges by expanding international options for Canadian travelers and reinforcing WestJet’s position in the global aviation network.

Tesla Shares Climb on Trade Optimism

Tesla stock rose nearly 5% on Friday, buoyed by investor optimism over potential progress in U.S.–China trade negotiations. The gains came despite weak first-quarter sales in Europe and China, and ongoing geopolitical uncertainty.

The rally was fueled by comments from U.S. officials suggesting a thaw in trade relations. Treasury Secretary Scott Bessent is scheduled to meet with Chinese counterparts in Switzerland this weekend, and President Trump hinted at a possible reduction in tariffs on Chinese goods, stating that an 80% rate “seems right.”

Tesla, which operates its largest and most profitable plant in Shanghai, stands to benefit significantly from any easing of trade tensions. The company also reaffirmed plans to launch its fully autonomous driving software in June, further boosting investor sentiment.

CEO Elon Musk said he would be dedicating more time to Tesla and less to his advisory role in the Trump administration, a move that may reassure shareholders amid regulatory and political volatility.

Markets React to Tariff Speculation

U.S. equity markets ended the week with mixed results as investors digested conflicting signals on trade policy. The Dow Jones Industrial Average slipped 0.3%, while the S&P 500 and Nasdaq posted modest gains, buoyed in part by Tesla’s performance.

President Trump’s social media posts on Friday suggested that the administration is considering slashing tariffs on Chinese imports from the current 145% to as low as 80%. He also claimed that “many trade deals” were “in the hopper,” fueling speculation ahead of the weekend’s trade talks.

Despite the upbeat tone, market sentiment remained cautious. The U.S. Dollar Index fell by 0.3%, and analysts noted that any resolution to the trade dispute remains distant. Still, the prospect of tariff relief provided a temporary lift to equities, particularly in sectors sensitive to international trade.

References

• Delta, Korean Air to strengthen partnerships with WestJet
• Air Canada lowers financial forecast amid declining cross-border travel
• Mixed sentiments on Wall Street 🗽Tesla gains 6% despite weak sales data
• Why Tesla Stock Continued Its Monster Run Friday
• Trump tariffs live updates: Trump floats slashing China tariffs to 80% with 'many' deals 'in the hopper'