Air Panama, the country's second carrier, aims to serve niche domestic and international regional markets rather than challenging Panama's powerful Copa Airlines.

Based at Panama City's downtown Albrook airport, Air Panama is undergoing an effort to consolidate its financial structure and standardise its fleet to simplify the number of types operated "to increase profitability", says the airline's general manager Eduardo Stagg.

"We're not looking to compete head-to-head with anyone. We're just looking for niche markets and opportunities that may develop," he adds.

Two recently acquired Fokker 100s have provided a capacity boost in the wake of the demise of local rival Aeroperlas, which was closed down by parent AviancaTaca in February. The 92-seaters are replacing two 70-seat Fokker 70s which are being sold to an Australian operator. Two Fokker 50 turboprops are flown along with two Saab 340s and two de Havilland Canada Twin Otters. "We are looking to purchase two more Fokker 50s to replace the leased Saabs next year to help us standardise the fleet," says Stagg.

Similarly, Fokker 50 freighters are being sought to replace the Fokker F27Fs flown on cargo operations. Much of its freight business is flown on a FedEx Express contract.

"We fly mostly within Panama and also serve Costa Rica," says Stagg. David, a city in the west of Panama, is the airline's major destination from Panama City with four daily roundtrips.

Carrying around 200,000 passengers a month, Air Panama is seeing a slight growth in traffic this year thanks to the closure of Aeroperlas after a flat 2011, says Stagg. The government's effort to expand Panama's airport infrastructure will provide more opportunities for growth, for example through launching tourist charter flights from the Rio Hato resort, he adds.

Air Panama already co-operates with Copa, flying some contract flights from the latter's Panama City hub at Tocumen airport, and talks have been held about expanding this co-operation. "If somebody at Tocumen needs connecting flights, we can do that for them - for Copa, for Avianca or any airline that might need some feed," says Stagg.

The airline does not currently envisage acquiring anything larger than the Fokker 100 in the near term, as this is about the maximum size of aircraft that can be operated from its Albrook airport base, which has a single 6,000ft (1,830m) runway.

Source: Flight Daily News