Viva Air is seeking to grow its footprint on regional routes in Latin America, taking share from legacy carriers that currently dominate such sectors.
Speaking at Routes Reconnected on April 26, CEO Felix Antelo told delegates that low-cost operators such as Viva are strong in domestic markets, but none have really challenged the likes of Avianca and LATAM Airlines Group on longer regional routes.
“We see an opportunity for our model to gain more share,” Antelo said. “There isn’t that much of a [ULCC] presence on regional flights. When you look at the share apart from on routes between Mexico and the US most of the flying is by legacy carriers.”
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Analysis
It appears as if COVID-19 has ushered in some consolidation in Mexico’s market, but not in the traditional forms of mergers and acquisitions. Even before the COVID-19 crisis, there were calls for consolidation of airlines in Mexico.
The market shifts have occurred due to the shrinking of two of country’s larger airlines in the wake of the pandemic. A form of unconventional consolidation has occurred, and Mexico’s ultra-low cost carriers are the biggest beneficiaries.
As a result of the changes, and as the aviation industry looks toward recovery, Mexico’s market composition could ultimately feature two ultra-low cost operators and one full service airline.
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