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News Article

COVID-19 Infects Mexican Airport Groups

By Alicia Arizpe | Mon, 05/04/2020 - 11:40

The drop in passenger traffic caused by the COVID-19 outbreak has hurt airports across the globe. Mexico’s airport groups started 2020 with a positive outlook but saw their revenues fall alongside the massive drop in traffic during the third month of the year.

While Mexico’s government has not restricted domestic and international flights, it has exhorted citizens to stay home as much as possible and avoid unnecessary travel. Moreover, several of Mexico’s main tourism and business destinations have restricted travel or closed their borders, landing a severe blow to the aviation industry. The country saw growth in traffic during the first two months of 2020, which offset the losses that arrived in March as the pandemic spread throughout the country.

Grupo Aeroportuario de Sureste (ASUR), which operates nine airports including Cancun International Airport, reported a 6.3 percent drop in total passenger traffic in 1Q20. The sharpest drop was felt in Mexico, were the group saw a 2.0 percent fall in domestic traffic and 12.3 percent fall in international traffic, for a total of 8.1 percent drop. ASUR also operates in Puerto Rico and Colombia, which saw a drop in traffic of 4.1 and 2.8 percent, respectively. The group highlights the COVID-19 pandemic as the main reason behind the sharp decrease in operations, pointing out that just in March, its traffic in Mexico fell by 35.8 percent, by 35.9 percent in Puerto Rico and 36.2 percent in Colombia. However, thanks to two positive months the group closed 1Q20 with a 1.4 percent increase in total revenue, for a total of MX$4.16 billion (US$170 million).

Grupo Aeroportuario Centro Norte (OMA), which operates 13 airports in the country, also reported a drop in passenger traffic in 1Q20 due to COVID-19 crisis. The group saw a total of 4,864,213 passengers, 4.9 percent less that during that same period in 2019. OMA reported that domestic traffic fell by 4.7 percent and international by 5.8 percent. Again, losses were felt sharply during March as the pandemic grew in the country. In that month, domestic traffic fell by 31.3 percent and international travel by 40.4 percent, for a total drop of 32.6 percent. OMA closed 1Q20 with a total of MX$1.90 billion (US$77.8 million) in revenue, a 2.3 percent drop in comparison to 1Q19.

Grupo Aeroportuario del Pacífico (GAP), which operates 12 airports in Mexico and 2 in Jamaica, reported a 1.4 percent drop in total traffic in 1Q20. While its domestic traffic showed no variation, the group reported a 2.9 percent drop in international traffic. The latter number includes those who used the Cross Border Xpress in Tijuana International Airport. In contrast to other airport groups, the drop in passenger traffic did not hurt GAP’s revenue. The group closed 1Q20 with a 35.1 percent increase in revenue, for a total of MX$4.97 billion (US$204 million), thanks in part to an increase in revenues from aeronautic services caused by higher airport use tariffs (TUA) and the depreciation of the Mexican peso. Revenue from non-aeronautic services also grew due to the increase in sales by third-party businesses at airport terminals, including car rentals, duty-free stores and restaurants.

The full effects of the COVID-19 outbreak in Mexico’s airports are still to be determined. On April 21, the country entered Phase 3 of the pandemic and stay-at-home measures were extended until the end of May, a move that is expected to further limit domestic and international travel in the short term. To address the financial impact the aviation industry is facing, IATA reiterated its call for urgent measures from local governments to help the sector weather the pandemic.

Alicia Arizpe Alicia Arizpe Senior Writer