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News Article

Mexican Airlines Cut Operations Again

By Alicia Arizpe | Fri, 04/03/2020 - 11:06

As COVID-19 continues to spread unabated, Mexican airlines take another look at their already-reduced operations to find ways to overcome the crisis.

The travel slowdown caused by the COVID-19 outbreak has drastically cut flights to and from Mexico with the number of visitors falling as COVID-19 cases rose. During the 13th week of 2020, Mexico received 21.2 percent less visitors from North America, 77.2 percent less from Asia and 75 percent less from Latin America. The sharp drop in visitors was keenly felt at local airports, with AICM reporting a 50 percent drop in total flights and Cancun International Airport a 75 percent drop in operations.

Local airlines have been hurt by the slowdown in travel. Some had already adjusted their operations to this drop in demand but were forced to do so again this week, as the crisis continues with no end in sight. Low-cost airline Volaris, which had already reduced its operations by 50 percent last week, did so again and announced an 80 percent reduction on March 31. Viva Aerobus is also developing a plan to optimize its operations, the airline announced on April 2, which includes reducing its flights by between 50 and 70 percent.

The crisis is expected to hurt airlines’ cash flows and bottom lines throughout the rest 2020 as the worsening economic depression delays traffic recovery until 2021. This drought in passenger traffic might put some airlines in danger as the average airline only had two months of liquid cash at the beginning of 2020.

Industry associations and airlines are working with government institutions to help the industry survive the crisis. Interjet, which had been carrying economic issues before the crisis and was later hurt by the drop in international flights, called for airlines to put aside their commercial differences and work together to overcome the outbreak.

Alicia Arizpe Alicia Arizpe Senior Writer