The overcapacity in Mexico’s domestic market led to fare pressure in Q2, which resulted in Volaris’ total operating unit revenue per available seat mile (TRASM) falling 2% year-over-year to 7.81 cents. “These aircraft are allocated primarily for domestic operations, meaning we are not fully capitalizing on their efficiency,” he said. Once the upgrade occurs, Volaris can resume its codeshare with Denver-based ULCC Frontier Airlines and better utilize the 35 Airbus A320neo family aircraft delivered to the airline since the downgrade, Beltranena said. The downgrade occurred more than two years ago Volaris CEO Enrique Beltranena said the “restoration process has been long and burdensome.” The airline plans to redeploy 5% of its total capacity into international markets once the FAA restores Mexico’s safety rating to Category 1, likely in the fourth quarter. He also said Volaris has encountered infrastructure constraints at Mexico City International airport, where its slots have been reduced. The airline has added 40 new domestic routes largely in secondary cities. The airline is taking several steps to counteract that surplus capacity including allocating three additional aircraft to its subsidiaries in Costa Rica and El Salvador for a total of nine aircraft deployed between those entities.ĭuring a July 25 discussion of 2023 second quarter (Q2) earnings, Volaris EVP Airline Commercial and Operations Holger Blankenstein said the airline’s competitors in Mexico do not have alternative air operator’s certificates, “leaving them with no other options to deploy additional capacity outside Mexico.”īlankenstein said Volaris was reshuffling its domestic capacity to alleviate pressure on specific higher density routes. Mexican ULCC Volaris is working to combat what it deems as temporary excess capacity in the domestic market as it waits for the U.S.
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