Latin American Airlines

Avianca Holdings 2014 net profit falls 52% to $120.5 million

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The airline operates four Boeing 787-8.
The airline operates four Boeing 787-8.

BOGOTA, Colombia–Avianca Holdings posted a full-year net profit of $120.5 million in 2014, down 51.6% from a net profit of $248.8 million in 2013. The Panama City-registered carrier reported full-year operating revenues of $4.7 billion, up 2% year-over-year (YOY), as expenses came to $4.42 billion, up 4.6% YOY. The company’s full-year operating profit was $284.6 million, down 26.1% YOY from 2013’s $384.9 million operating income.Avianca’s cargo revenue performance was strong in 2014, totaling $834.2 million, up 11.6% YOY. During the year, Avianca acquired a stake in Mexican airfreight carrier AeroUnion and entered into a commercial agreement with Etihad, “creating a stronger cargo operation and more connectivity from Los Angeles via Mexico, while also improving cargo connectivity to Europe, from Milan and Amsterdam to Bogota,” Avianca said. Avianca’s passenger traffic grew 4.5% YOY to 32.6 billion RPKs on a 5.9% rise in capacity to 41.1 billion ASKs, finishing 2014 with a full-year load factor of 79.4%, down 1.1 points from 2013. The company carried 26.2 million passengers in 2014, up 6.6% YOY. CASK for the full-year decreased 1.5% YOY to 10.7 cents, partly attributable to the drop in fuel prices during the 2014 fourth quarter, Avianca said. Excluding special items, Avianca reported an adjusted net income of $129.1 million for the year. The company said its 2014 EBITDAR (earnings before interest, taxes, depreciation, amortization and rents) totaled $786.7 million, down 5% YOY; Avianca’s full-year EBITDAR margin was 16.7%, down 1.3 points from 2013. In 2014, Avianca took delivery of 32 new aircraft, including 14 Airbus A-320 family aircraft, 10 ATR 72-600 aircraft for regional flight deployments, four Boeing 787-8 Dreamliners, two A-330s and two A-330 freighters. All 10 of the company’s Fokker 50s were phased out and sold; the company’s entire ATR 42 fleet was retired as well. As of Dec. 31, 2014, the company’s consolidated operating fleet comprised 181 aircraft. Avianca Holdings, created in 2009, operates Latin American airlines Avianca (based in Colombia), TACA (based in El Salvador), Costa Rica’s LACSA, Guatemala’s Aviateca, Ecuador’s Aerogal, plus Avianca Brasil, TACA de Honduras and TACAPeru.

New Airlines and Flights to Costa Rica

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SAN JOSE, Costa Rica–On July 12th a complete article in LA NACION, Costa Rica’s main newspaper informed of the new flights and airlines that will start operations to Costa Rica.  On August 16th Avianca Airlines Costa Rican division under the name of LACSA will start flights from San Jose to Santiago, Chile via Bogota and from San Jose to Rio de Janeiro, Brazil always via ElDorado International Airport at the Colombian capital.  Also in August Cubana Airlines (the flag carrier of Cuba) will reinstate flights between Havana and San Jose. The airline used to operate the routes some years ago until it code shared it with TACA. Last year TACA suspended the route linking Cuba with Costa Rica. By November 1st the American carrier JetBlue Airways will open Boston-Liberia flights. For the end of the year the Civil Aviation of Costa Rica (DGAC) will have the final permits of the certification process of Air Costa Rica (Tica Air International) a new Costa Rican airline. The airline plans to start flights to Miami, Managua, Panama and San Andres Island. A second phase would include Quito, Guayaquil and Havana and a third phase would include New York and Los Angeles, routes once operated by LACSA. A second Costa Rican carrier, TICOS AIR has not been able to move forward in their certification process explained Alvaro Vargas, the director of the aviation department. Also Salvadorian start-up VECA Airlines is expected to obtain final permits to operate San Salvad0r-San Jose run. Vargas also mentioned Brazilian airline AZUL Linhas Aereas has been interested in learning about permit processes. Other airlines that have been metioned as interested in Costa Rica include Southwest Airlines, Alaska Airlines, Allegiant, Eastern Airlines, TAME of Ecuador and CONVIASA of Venezuela.

Cubana Airlines will start Havana-San Jose flights in August.
Cubana Airlines will start Havana-San Jose flights in August.

Costa Rican Airline Requests Operating Permits

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SAN JOSE, Costa Rica–Air Costa Rica is the new brand name of  Tica Air according to the Public Registry of the airline, which has launched the second phase of a certificationn process and expects to receive approval from the Directorate General of Civil Aviation within four to six months to operate as an international airline. The first stage of the airline’s plans include starting with charter flights to other countries in the region and then opening international routes to the United States, Nicaragua, Panama City and Colombia. Carlos Víquez, the director responsible for the formation of the airline , told El Financiero (EF) that “Civil Aviation now have 10 days to review the technical information provided, as the legal and financial documents have already been accepted. After that period, the government entity will usually provide a list of differences, for which the company has 30 working days to respond. ”  Air Costa Rica is a company whose associates, George Novey and Eduardo Stagg, also own Air Panama. This company has operated since 2006 and has over 300 employees and 18 aircraft. Its core business is domestic flights in Panama and its only international route so far is San Jose. Last February, Stagg informed El Financiero that it was interested in operating a route to Miami from San Jose, taking advantage of the fact that Avianca had left that slot empty after closing the former LACSA hub at Juan Santamaria International Airport.  They have also announced flights to Managua, Panama and San Andrés. Air Costa Rica would operate one of the Boeing 737-300s that Air Panama has purchased. At the moment Air Costa Rica seems to be the most probable Costa Rican carrier to start air services as Ticos Air has not been able to take off and has lost momentum.

Air Panama has two Boeing 737-300s. One will be used by Air Costa Rica.
Air Panama has two Boeing 737-300s. One will be used by Air Costa Rica.

 

 

Guanacaste. Hottest Destination in Latin America.

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MIAMI, Florida–A group of American Leisure travel agents have declared the Guanacaste Province of Costa Rica as the hottest destination in 2014. The opening of Liberia’s International Airport (official name: Daniel Oduber International Airport) has triggered a development of new hotel and resort properties. Last December Hyatt opened its first Central American resort, the Andaz Papagayo Bay. This hotel has already been named one of the best resorts in 2014: http://www.cntraveler.com/hot-list/2014/best-new-hotels-world-photos_slideshow_Andaz-Peninsula-Papagayo-_17. In February Preferred Boutique Resorts opened El Mangroove at Panama Beach, also in the Papagayo Bay. For November 2014 AM Resorts will opened The Dreams Las Mareas at the beautiful Salinas Bay: http://www.dreamsresorts.com/las-mareas. For 2015 two new additional resorts will open: Melia Paradisus Papagayo Bay and the FEN Resort at Tamarindo Beach. Future projects include: a Marriott, a Wyndham, a Mandarin Oriental and a super deluxe Rosewood Resort in Monte del Barco. Guanacaste is often called “The Golden Coast” or the Costa Rican Riviera. The growth and development of new high end resorts has places the region as the hottest destination for Honeymoons and Weddings, Golfing and Meetings & Incentives. Liberia International Airport is serviced by American Airlines, Jetblue, United, USAirways, Frontier Airlines, DELTA Airlines, Sun Country, Air Canada, West Jet, Sun Wing Airlines and Air Transat from North American cities, plus COPA and Avianca from Panama City and San Salvador respectively. Domestic airlines SANSA and Nature Air operate flights from San Jose.

Guanacaste is the Golden Coast of Costa Rica.
Guanacaste is the Golden Coast of Costa Rica.

 

Maduro Warns Airlines not to cut Flights

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CARACAS, Venezuela–President Nicolas Maduro warned airlines not to limit flights in and out of Venezuela, days after Avianca reported was reducing flights to Caracas amid industry complaints of billions of dollars in unpaid debts. “Airlines have no excuse to reduce their flights to Venezuela”, Maduro said during a press conference. “If airlines reduce flights, I will take severe measures.” Airlines have struggled to obtain dollars in exchange for the Bolivar currency as a result of long-running delays in Venezuela’s 11-year-old currency control system. The International Air Transport Association (IATA) this week said that airlines are owed USD $3.7 billion and that some are considering halting service to Venezuela. “If an airline leaves the country, it’s not coming back while we are in government”, Maduro said, casting the airlines’ complaints as part of a wider economic war against his socialist government by political foes and businesses. Maduro also said, however, that his government would pay debts to the airline industry. Avianca Holdings, operator of Colombia’s biggest airline, on Thursday told travel agents it will cut flights between the countries’ capitals to one day from three as of March 20th. Avianca will suspend flights between Caracas and San Jose, Costa Rica, as part of an effort “to match supply to market needs” and reduce the number of seats available between Caracas and Lima. The company’s Chief Executive said that currency controls hade made it difficul to bring revenue worrth about USD$300 million out of Venezuela. German airline Lufthansa said this month its 2013 financial results took a double-digit million euro hit from payment issues in Venezuela. Maduro said that various airlines around the world were ready to step in and cover any unfilled routes. “They’re asking permission to cover flights to Colombia, Panama, Central and South America”, he said without giving more details. Venezuelan state-run air carrier CONVIASA is expected to take over several routes like the Caracas-San Jose run.

Venezuelan president warns airlines not to cut flights.
Venezuelan president warns airlines not to cut flights.

The Brunca Region International Airport

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SAN JOSE, Costa Rica–The Civil Aviation General Directorate of Costa Rica announced in the nations capital, the Brunca Region International Airport (South Pacific of Costa Rica) will become in several years a reality. The international airport will be located 5 kilometers of the town of Palmar, close to the Sierpe wetlands in the Province of Puntarenas. The AIRB (in spanish Aeropuerto Internacional Region Brunca) will be constructed in the next four years and it is expected the new President of Costa Rica that will take power on May, will focus in the development of this important international airport in the South Pacific region. The construction of the airport will have two phases. Phase 1 will include a runway of 2,200 meters long by 45 meters wide. The terminal building would be able to attend from 150 to 200 passengers per flight. For Phase 2 the runway would be extended to 3,300 meters.  “The airport has the objective to serve and facilitate the arrivals of airplanes like the Hercules C-130, equiped to transport emergency materials”, Alvaro Vargas, the director of the Civil Aviation informed. The commercial airplanes that are expected to service the AIRB are Airbus 320 family of jets (A-320,A-319 and A-318), Embraer E-190,  the regional ATR-72s, De Havilland DHC-8 and Learjets.  In addition to U.S. and Canadian carriers, the DGAC hopes that airlines like Avianca and COPA Airlines would operate flights from their respective hubs in San Salvador and Panama City. Also new start-ups in Costa Rica like Ticos Air and TIA (Ticas International Airlines) will be invited to operate in the Brunca Region International Airport.

Brunca Region International Airport in the South Pacific of Costa Rica will be constructed 5 kilometers from the town of Palmar.
Brunca Region International Airport in the South Pacific of Costa Rica will be constructed 5 kilometers from the town of Palmar.

 

VECA Airlines ready for Take-Off

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SAN SALVADOR, El Salvador–The first LCC (Low Cost Carrier) in Central America, VECA Airlines (Vuelos Economicos Centro Americanos) is expected to start operations very soon. The airline will operate two Airbus A-319s from its hub at Comalapa International Airport of El Salvador to all the Central American capitals and important cities: Guatemala City, San Pedro-Sula, Tegucigalpa, Managua, San Jose and Panama City. VECA Airline is hoping to break the duo-poly of the Central American traffic of both Avianca (former TACA Airlines) and COPA Airlines of Panama. Several former TACA Airlines employees work at VECA Airlines, the new runner up as the Salvadorian flag carrier after the absorption of TACA by the Colombian flag carrier. VECA Airlines is one of the three Central American carriers hoping to take off in 2014. The other two airlines are from Costa Rica: Ticos Air and TIA (Tica Air International) owned by Air Panama. Both projects have been slow to start, and now Costa Rican pubkic opinion is skeptical the airline owned by Gino Renzi (Ticos Air) will ever take off. In the meantime, VECA Airlines is ready for take off.

VECA Airlines will operate Airbus A-319s for Intra-Central American service.
VECA Airlines will operate Airbus A-319s for Intra-Central American service.

 

Second U.S. Gateway for TAME

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QUITO, Ecuador–Ecuadorian flag carrier TAME has informed that in April, it will start Quito-Fort Lauderdale-Quito flights. This will be the second U.S. gateway for TAME (the airline already operates to New York-JFK). Fernando Guerrero, the General Manager of the airline is revamping its schedule, hoping to convert Quito’s Mariscal Sucre International Airport in a connecting hub. The flights from Sao Paulo, Buenos Aires and Lima will easily connect in Quito to New York-JFK, Fort Lauderdale and Havana, Cuba. The airline also analyzes if to suspend its flights to Panama City’s Tocumen International Airport for six months as load factors are around 50%. Also TAME has a code sharing agreement with the Panamanian airline COPA Airlines. Guerrero is planning to adjust TAME’s actual structure to the growth the airline has had in the last years, becoming the most important carrier of the country. At the moment more international routes are just in planning analysis like Quito-San Jose, Costa Rica. Last May Avianca’s TACA Airlines suspended its operations connecting the Ecuadorian capital with San Jose opening the opportunity for TAME’s operation to the Costa Rican capital.

TAME of Ecuador will start flights between Quito and Fort Lauderdale in April.
TAME of Ecuador will start flights between Quito and Fort Lauderdale in April.

Viva Colombia to Central America

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SAN SALVADOR, El Salvador–Viva Colombia’s Commercial Vice-President William Shaw, declared the airline is analyzing opening flights to the Central American capitals. Shaw attended the ROUTES AMERICAS symposium held at the Sheraton Hotel in the Salvadorian capital. “We are looking into the route to El Salvador or even to have a base in El Salvador”, Shaw declared. “The Central American region really needs a low cost carrier”. El Salvador’s Minister of Tourism, Jose Napoleon Duarte confirmed the negotiations with Viva Colombia are well advanced. Shaw insisted the interest of Viva Colombia for El Salvador is mainly because two things, the great tourist potential the country has and the Salvadorians that live outside their nation, up to 3 million and from those, 2,5 million in the United States. “We still don’t have anything defined, but with the aid of the Minister of Tourism of El Salvador, soon we will be announcing our decision” concluded William Shaw. Viva Colombia announced several months ago its plans to expand to destinations like Panama and Costa Rica. The entrance of Viva Colombia to the market will make the competition fierce between the legacy carriers like Avianca and COPA Airlines, and the low cost carriers like Viva Colombia and Salvadorian start-up VECA Airlines that should start operations in the next months.

Viva Colombia could start flights to Central American capitals in the near future.
Viva Colombia could start flights to Central American capitals in the near future.

Quepos Aerodrome to the Next Level

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SAN JOSE, Costa Rica–The Costa Rican Technical Council of Civil Aviation (CTAC in spanish)  informed today of its expansion plans for the Quepos/Manuel Antonio Aerodrome at La Managua (code: XQP). The airport will become a regional domestic and international airport, capable of servicing aircraft as the regional jets Canadair CRJs, Fokker 70s and the ATR-72s. Today the aerodrome receives up to 20 flights a day, most of them domestic from San Jose, the capital of Costa Rica. Two small carriers service Quepos/Manuel Antonio, SANSA Airlines (property of Avianca) and Nature Air. By 2015 the airport will be able to receive not only domestic flights but also internationals, since the new terminal will have Inmigration and Customs areas. Alvaro Vargas the Director of the Civil Aviation Board explained the upgrading consists in a longer and wider runway, bigger ramp, new airport terminal, fire station and hangars for airplane maintenance. The total cost of the upgrade will be of $5 million and its expected to bring more development to the area, well known as one of the “hottest” leisure destinations in Costa Rica. Quepos/Manuel Antonio Regional Airport will be the natural gateway to the Central Pacific, close to national parks, rain forests and spectacular resorts. It is also expected that airlines like Avianca would be interested in opening international services from its Central American hub at Comalapa International Airport in El Salvador, connecting the eleven North American gateways the airline services. Also new international Costa Rican carriers like Ticos Air and Tica Air International (property of Air Panama) are also expected to open flights to Quepos/Manuel Antonio once the airport has the new terminal building.

Quepos/Manuel Antonio will become a Regional International Airport by 2015.
Quepos/Manuel Antonio will become a Regional International Airport by 2015.