- CAPA Analysis
- Schedule Analysis
- Route Maps
- US Route Data
- Print Summary
- IATA Code
- ICAO Code
- Corporate Address
- Aeropuerto de Monterrey, Terminal C, Zona de carga
Carretera Miguel Alemán Km. 24
Apodaca, Nuevo León, México
- Main hub
- Mexico City Juarez International Airport
- Business model
- Low Cost Carrier
- Domestic | International
VivaAerobus is a Mexican low-cost carrier based at General Mariano Escobedo International Airport in Monterrey. The LCC was established in 2006 as a strategic alliance between Mexican bus operator IAMSA and Irelandia, an investment vehicle of Ireland's Ryan family. VivaAerobus operates to over 25 destinations across Mexico and two in the United States. The airline operates a fleet of Boeing 737-300 aircraft.
Location of VivaAerobus main hub (Mexico City Juarez International Airport)
LCCs will continue to evolve into hybrids of the original core model. CAPA and OAG consider VivaAerobus fits the LCC profile and it is included in our reporting on this basis. Please note: when reporting for an airline is changed from or to LCC the historical data is not affected and it can lead to a distortion in the current reported data. Contact us if you have any queries.
183 total articles
36 total articles
Mexican low-cost carrier VivaAerobus began 2014 on a down note – cancelling a planned public offering valued at roughly USD226 million as it concluded market conditions were too dour and unpredictable to achieve an IPO successfully.
The cancellation occurred as VivaAerobus prepared for the first delivery of an Airbus A320. Its acceptance of the new jet marks a pivotal transition from older Boeing 737-300 narrowbodies to similar aircraft operated by its fellow low-cost rivals Interjet and Volaris.
VivaAerobus’ decision to shutter accessing the public markets does leave some questions as to how it will finance the 52 Airbus jets it has on order as six of the aircraft are scheduled for delivery in 2014. On a broader scale, VivaAerobus remains the smallest carrier among the four largest Mexican airlines, three of which (including VivaAoerbus) define themselves as low-cost carriers. If the projected rebound in Mexico’s economy fails to materialise during 2014, VivaAerobus’ greater exposure to the domestic market could create challenges for the carrier’s yet-to-be defined strategy for the future.
Mexican carriers Aeromexico and Volaris managed to turn profits during FY2013 despite the country’s sagging economic conditions that produced GDP growth of just over 1% in 2013.
Mexico’s dour economic conditions resulted in each carrier facing yield weakness during 4Q2013, which triggered a quarterly loss at Volaris. No improvements in pricing traction are expected until 2H2014 at the earliest, which means in the short term Aeromexico and Volaris will continue to trade yield for load factors while preparing for double-digit capacity growth during FY2014.
Given the expected slow recovery in Mexico’s domestic market, each carrier has opted to steer a larger portion of their planned capacity increases into international markets, where presumably the two airlines can price fares at levels to offset continued pricing weakness on domestic routes.
Aeromexico, Mexico’s largest network carrier, plans a revamp to its Mexico City hub during 2014 to maximise connectivity as part of its strategy to strengthen the airport as a connection point to the numerous markets it serves in Latin America and solidify its place in the domestic market.
The carrier also plans to phase out its smaller 50-seat Embraer ERJ-145 jets in Mexico City by YE2014 to improve its competitive position and increase its seat count at the slot-controlled airport. Other changes Aeromexico plans to implement includes the introduction of a new shuttle product in some of Mexico’s busiest business markets.
Aeromexico’s product and schedule improvements occur as Mexico’s four largest carriers – Aeromexico, Interjet, Volaris and VivaAerobus – become firmly entrenched in their respective business models and continue to expand in order to ensure they capture their fair share of Mexico’s domestic market. As a comprehensive full service carrier, Aeromexico needs to position itself as a competitive force in all passenger segments in order to sustain its stature as Mexico’s leading airline. Introduction of a new low fare product Contigo in 2013 in transborder markets from Guadalajara was an imortant move.
Mexico’s Interjet begins 2014 with hints that it may finally undertake an on-again, off-again initial public offering as hopes are high that Mexico’s economy will improve after a lacklustre performance during 2013.
Near the end of 2013 Mexico’s publicly traded carriers Aeromexico and Volaris were battling weak yields, trading in pricing traction to maintain load factors as conditions in the Mexican domestic market were challenging. As Mexico’s second largest carrier in terms of seats on offer in the country’s domestic market, privately-held Interjet also likely experienced some yield pressure during 2013.
Interjet continues its growth in 2014 as it accepts more deliveries of the 93-seat Sukoi Superjet 100 narrowbody jets that should aid the carrier in penetrating smaller markets and perhaps right-sizing capacity during less busier times on trunk routes. At the same time the carrier is considering building Guadalajara into a hub, following the launch of new international flights from Guadalajara to San Antonio in Dec-2013.
Colombia’s only low-cost carrier VivaColombia is planning to accelerate expansion in 2014 with the launch of international services and several domestic trunk routes. The carrier, which did not add a single aircraft to its fleet 2013, is keen to grow its domestic market share to at least 20% from about 9% currently. But the biggest opportunities could be in Colombia’s international market, which remains un-penetrated by LCCs with the exception of services to the US.
VivaColombia is poised to become the first Latin American LCC to serve Panama and Peru. Services to Mexico are also likely as VivaColombia looks to start pursuing synergies with Mexican sister carrier VivaAerobus.
VivaColombia and VivaAerobus are both partially owned by aviation investment firm Irelandia, which aims to establish other Viva affiliates in Latin America. Irelandia sees huge opportunities in the region’s LCC sector, which is now limited almost entirely to domestic operations within just three countries – Brazil, Mexico and Colombia.
Is the LCC label still valid? Are they only about point-to-point markets? What are the prospects for LCCs created by full service carriers? Is there a unit cost threshold that defines a low-cost carrier? Peter van Fenema, Adjunct Professor at McGill University, led a panel discussion at the CAPA World Aviation Summit in Amsterdam in Nov-2013, in which executives shared their experiences of being involved in LCCs.
The panel included representatives of a European LCC owned by a legacy group, a legacy group planning a new LCC subsidiary, a start-up LCC in Africa, China’s only pure LCC and an investor in LCCs.
In our fourth in a series of reports on the panel discussions at the Summit, we summarise recent LCC experiences and developments.
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