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Aviation History
1982
1982 - 1983.PDF
AIR TRANSPORT Mexicana: the facts emerge Although the inner details of the Mexican Government's takeover of Mexicana are still confused, significant policy decisions and financial facts are becoming evident. The airline's ex-chairman Crescendo Ballesteros has strongly denied that he sold his controlling shareholding to the State because his other business interests were in bad trouble financially. According to Ballesteros, his companies are in "splen did" financial condition, and he always keeps the affairs of his various interests sep arate. But what concerns others is that he sold his stock to the Government for an undisclosed sum, and without offering other priv ate shareholders in Mexicana the option of buying it. Although this deal was perfectly legal under Mexi can law, it has created much concern in the country's pri vate industry sector. Many businessmen believe that only the President - elect Senor Miguel de la Madrid has the political clout to order the nationalisation of Mexicana. If so, the implica tion is that Ballesteros was told to sell. They believe this action may only be the first of several as the Mexican Government fights desper ately to rescue the country from its ever-worsening fin ancial plight. The Mexican devaluation in February hurt both Mexi cana and Aeromexico badly, as their foreign debts, fuel bills, and wage costs shot up overnight. The airline's debts have effectively doubled since the devaluation was undertaken. Mexicana began losing money immediately, but to what extent is not yet clear. Some sources say that it lost about $8 million in the first three months of the year, others $128 million. Whatever the losses on pa per, the situation was bad enough for Mexicana presi dent Manuel Sosa de la Vega to circulate an internal docu ment in May saying "Never before have we lost so much money in so few months". None of this: was apparent The first of 17 Boeing 757s for British Airways undergoes final assembly at the manufactur er's Renton plant. It will be used later this year for UK CAA certification testing when Flight visited the air line in April. The airline's staff, including Sosa de la Vega, expressed confidence for the future, as long as the effects of devaluation could be minimised. But what was also not apparent was that the Mexican Government had been subsidising the two major Mexican airlines to a massive extent on many do mestic routes. According to the official Government mouthpiece El Nacional, technicians from the Ministry of Communica tions and Transport have stated that the Federal Gov ernment decided it had in jected too much money into Mexicana, and it saw no end to the subsidies. The money was not given as a gift, and the country's financial situa tion demanded that it be got back. Whether this is true or not, Mexicana is now under Government control along with Aeromexico. The signs are clear that the two will probably be merged: Manuel Sosa de la Vega has now re signed as Mexicana's presi dent, and Aeromexico's di rector-general Enrique Loa- eza Tovar is to head both companies. Mexico's Com munication and Transport minister Emilio Mujica Mon- toya has been appointed chairman in place of Cres cendo Ballesteros. Montoya has stated in no uncertain terms that part of the reason the Government bought out Mexicana was to avoid "ruinous" competition be tween Mexicana and Aero mexico on some domestic routes. It is known that the two compete over only 5 per cent of their networks, but some of these routes are im portant. If Mexicana was hurt by this competition, and its fin ances were not in as pristine condition as it led the world to believe, one thing is just about certain: Aeromexico is in a worse finandal state. Its profits were never as big, its yields not as good, and it carried fewer passengers. Mexican industry sources were, to say the least, criti cal of Aeromexico's opera tion while talking to Flight earlier this year. It would seem that the Mexican Gov ernment believes the only way the two airlines can sur vive is by total co-operation, if not merger. One other major question- mark was raised about Mexi cana, and may have played a part in the Government's decision. Some felt it could not grow quickly enough while being financed only with private capital. As pri vate capital inherently in volves commercial risk, the airline had to present good balance sheets to secure loans to finance large-scale aircraft purchases. These were necessary to cope with huge growth on most of its routes. Mexicana recently cancelled an order for six Boeing 727-200s; hope has been expressed in the indus try that the order will be re instated now. Aeroport de Paris does well PARIS Aeroport de Paris is daim- ing a good traffic year for the second year running. The traffic processed at its three airports of Orly, Charles de Gaulle, and Le Bourget in 1981 accounted for 286,000 commercial air transport movements by 171 airlines belonging to 81 coun tries—a drop of just 2 per cent compared with the pre vious year's result. A total of 28-5 million passed through the three air ports^—a 7 • 1 per cent in crease over the number car ried in 1980. This is a better result than those for most other major European airports, says the Authority. Passengers travelling with French airlines accounted for 67-5 per cent. Charles de Gaulle handled more than 11 million passen gers and processed 72 per cent of Aeroport de Paris' freight—representing 40 per cent of the total figure. Orly Airport handled 17 million passengers—60 per cent of the total. Aeroport de Paris reported a FF28 million (£2-3 million) profit last year, compared with a £5 million profit in 1980. Bevenues obtained through Aeroport de Paris' activities totalled £184 mil lion, a 16 per cent increase over last year's figure. FLIGHT International, 14 August 1982 345
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