American restructuring could create Latin opportunities, say rivals

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Rivals expect American Airlines' reorganisation following its Chapter 11 bankruptcy filing could open up opportunities for expansion in the Caribbean and Latin American markets, but doubt that the US major carrier will release too much of a grip on its long-held dominance in the region.

"American owned Latin America for many, many years but it's been attacked on all sides," said COPA Airlines vice-president commercial Joe Mohan, speaking at the Airline Business organised Network Latin America 2011 conference held in San Juan, Puerto Rico, this week. "American's competitive advantages have been eroded over the years so it's not going to be as easy, but its Miami hub is still a fantastic asset."

JetBlue Airlines has been rapidly expanding its presence in the Caribbean in the last three years and has become the dominant player at the long-standing American hub in San Juan. The region now accounts for a quarter of its capacity. "I think there'll be an acceleration of the transition that has already been happening," said Dave Clark, director of route planning at JetBlue.

David Bishko, who is managing director market development and analysis at Delta Air Lines' Latin American and Caribbean division, expects its rival will not give up its strong presence in the region without a fight: "American will survive and I think it is going to hold on to Latin America and the Caribbean more strongly than most other regions because it's got such a history here," he told delegates.

Meanwhile Southwest Airlines, which is looking to grow its international business as it integrates recently acquired low-cost rival AirTran Airways, sees the American filing potentially creating a new threat: "From a competitor standpoint, American could emerge as another competitor with a low cost structure - more competition in the same environment which could be a challenge," said the airline's manager international planning, Evan Berg. "There are also going to be opportunities that present themselves as a result of the restructuring."