ALTA: Aeromar to diversify network into the USA

Panama City
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Mexican boutique regional carrier Aeromar plans to diversify its network to include new routes to the USA, as it faces increasing competition at its Mexico City base.

The Mexico City-based airline is considering destinations in Texas' Rio Grande Valley and others south of San Antonio, says Fabricio Cojuc Wolfowitz, vice-president of network planning and corporate development at Aeromar, on the sidelines of the ALTA Airline Leaders Forum 2012 in Panama City. It is also considering expanding its small focus city in Poza Rica on Mexico's Gulf Coast.

He says that Aeromar will continue to operate on its "bread-and-butter" network - routes with stage lengths of up to 300 miles (480km) from Mexico City - but rationally add new destinations where it can take advantage of untapped niches.

"The core of our network faces increasing competition from airlines like [Aeromexico] Connect or from airlines who are bringing 100-seaters like Interjet," says Wolfowitz. "There is going to be more intense competition in the years to come and how we prepare ourselves is by modernising our fleet and looking at markets that can support service where a jet or a larger aircraft likely would not be able to make it profitable."

Aeromar bought two ATR 72-600s with deliveries scheduled for 2013 to replace older and smaller ATR 42-300s. It also acquired two Bombardier CRJ200s earlier this year.

Aeromexico, Interjet and Volaris all have large outstanding aircraft orders that, depending on where they are deployed, could add significant additional capacity to Mexico's domestic network. Aeromexico has 67 Boeing 737 current generation and Maxs on order, Interjet 65 Airbus A320 family current generation and neos plus Sukhoi Superjets, and Volaris 53 A320 family current generation and neos, according to Flightglobal's Ascend Online database.

Concerns regarding the "ability to preserve the slots you have" at Mexico City have replaced those on the availability of slots at the airport, says Wolfowitz. He explains that there is no regulatory framework governing how the landing and takeoff rights are granted and taken away, which could become an issue as competition heats up.

The availability of slots was a concern for Aeromar prior to the demise of Mexicana Airlines in 2010.

Aeromar hopes to build on its codeshare partnership with United Airlines. Launched with Continental Airlines prior to its merger with United in 2010, the regional carrier is a member of the US carrier's frequent flyer programme MileagePlus and feeds its flights at Mexico City.

"We have a foundation for a very powerful partnership," says Wolfowitz. He says that it is "developing" and that he anticipates expanding the relationship as United establishes its long-term strategy for Mexico.

Codeshares with other airlines are not out of the question but Wolfowitz says that Aeromar is content with its 18 interline agreements.