American Airlines will cut its schedule to Venezuela significantly in July, as the amount of cash it has trapped in the country continues to mount.
The Fort Worth, Texas-based Oneworld alliance carrier will discontinue 38 of its 48 weekly flights between the USA and Venezuela and end service between Caracas and Dallas/Fort Worth, New York JFK and San Juan after 1 July, it tells Flightglobal.
American will continue to operate eight weekly flights between Miami and Caracas, and two weekly flights between Miami and Maracaibo, it adds.
“Since we are owed a substantial outstanding amount and have been unable to reach resolution on the debt, we will significantly reduce our flights to the country,” says the airline.
American had $750 million in cash trapped in Venezuela valued at an exchange rate of Bs6.32 to $1 at the end of March. It said at the time that it continued to work with local authorities regarding the timing and exchange rate of repatriation.
Venezuela has recently reached agreements to repatriate some trapped cash with Air Europa, Aerolineas Argentinas, Aeromexico, Aruba Airlines, Avianca, Insel Air and TAME. However, it has not been enough to stop service cuts.
Air Canada and Alitalia have discontinued service to the country altogether, and Copa Airlines has cut the number of flights it operates to Venezuela.
American is the largest international carrier flying to Venezuela, with nearly 12% or 68 million available seat kilometres (ASK) scheduled in June, Innovata FlightMaps Analytics shows. It operates 45.2% of the capacity between the USA and Venezuela.
“Venezuela is not playing by the rules,” said Tony Tyler, director general and chief executive of IATA, at the organisation’s annual general meeting earlier in June. “It's not surprising that some airlines have stopped flying there: airlines cannot provide a service if they don't get paid. The government has responded with more promises than action.”
IATA estimated that $3.9 billion in local airline revenues are trapped in Venezuela in April.
Source: Cirium Dashboard