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Aeromexico and Volaris find some positive signs despite US market and industry uncertainty

Mexico’s two largest airlines, Aeromexico and Volaris, are bracing for uncertainty, created by the new US President Donald Trump through his immigration actions and protectionist slant toward trade policies. Each airline has specific tools to combat the effects of political change – Volaris is diversifying its network through a new operation based in Costa Rica, and Aeromexico is betting its new joint venture with Delta Air Lines will blunt some of the negative effects of US policies.

But the reality is that the US remains the largest international market for each airline by wide margins.  

A post election currency dive and revised GDP growth targets for Mexico are challenges that all Mexican airlines face in 2017. For now, Aeromexico and Volaris appear to be experiencing a softness in demand on northern leisure routes from Mexico, but that could quickly spread to other market segments important to each company.

Much untapped potential demand remains in Mexican air travel. But a new political landscape in the US may force some Mexican airlines to reshape their strategies if Mr Trump’s rhetoric transforms into actual policies.

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