Por dave graham
MEXICO CITY, Oct 16 (Reuters) – Mexican low-cost carrier Volaris expects to consolidate much of the market it has gained during the coronavirus pandemic, although annual revenues are unlikely to return to pre-health emergency levels sooner 2022, said the company’s CEO.
Volaris, the country’s largest airline by passenger traffic, had until January a 32.5% share in the domestic market and 7.7% of international figures, according to government data.
But it has fared better during the pandemic than its main rivals, and by August, Volaris’ share of domestic business was nearly 44%. Its percentage of international passengers had increased to 18.8%.
Several airlines in Latin America, including Volaris’ largest Mexican competitor, Aeroméxico, have relied on the protection of justice during the crisis while reaching an agreement with their creditors, which has shaken the industry.
Volaris CEO and CEO Enrique Beltranena said he expected the company’s rivals to gradually make up for lost ground over the next few months. But he believed that much of the gained space could stay.
“The year 2021 will end more or less with a 40% share of the domestic market and I would say in the international market around 17-16%,” he said in an interview with Reuters.
Volaris says it has weathered the pandemic with the help of significant pre-existing cash holdings, a flexible cost structure, as well as by renegotiating its aircraft leasing costs.
Last month, the company obtained approval from its shareholders for a capital increase of up to 3.5 billion pesos ($ 165.57 million). How it will be carried out has yet to be determined, and Beltranena said there was no rush.
“The company’s priority continues to be to ramp-up (increase) operations as quickly as possible,” he said, adding that Volaris did not intend to raise new capital over the next two months.
Beltranena did not anticipate that Mexico will have to apply new restrictions to economic activity in the face of an upturn in infections as is happening in some European countries, but believes that new cases in the Latin American nation will probably remain stable until February or March.
Given the ongoing impact of the pandemic, Volaris revenue does not appear likely to recover to 2019 levels next year, the executive added.
“In 2022, anticipating that nothing happens and everything continues ‘ceteris paribus’ (constant) could be there,” said Beltranena.
(1 US dollar = 21.1390 Mexican pesos)
(Translated by Noé Torres. Edited by Abraham González)