Panamanian carrier's fleet upgrade plans held in abeyance until expected US FAA Category 2 review is announced

Copa Airlines is considering an order for additional Boeing 737s for delivery from next year, but the company's growth plans hinge to a large extent on an expected US Federal Aviation Administration review of current Category 2 restrictions on services. Similarly, Grupo TACA expects a decision under the FAA's International Air Safety Assessment (IASA) programme to restore El Salvador and Guatemala to Category 1.

Panamanian carrier Copa is retiring its 737-200Advs at the rate of two a year as new jets enter service. Delivery this year of the final four of the 12 737-700s it ordered or leased in 1999 still leaves Copa with a residual fleet of eight 200Advs in need of replacement. The airline, factoring in projected growth, is looking to acquire eight to 10 additional aircraft and is working with Boeing to secure the extra capacity towards the end of next year, says Copa chief executive Pedro Heilbron.

Category 2 prevents Copa from changing the size and type of aircraft operated to US destinations, while routes and frequencies are frozen and no new 737-700 can be added or substituted for those on the original operational specifications. One option being considered by Copa is to include the larger 737-800 in its next planned purchase.

Panama was downgraded a year ago following an IASA audit of the local regulatory authority. Copa has been forced to suspend putting its code on flights operated by part-owner Continental Airlines and as a result is losing more than $2 million a year in revenue.

"Panama has done a good part of what was needed in terms of hiring and training inspectors…We're expecting Panama to come out of Category 2 in the coming months," says Heilbron.

TACA has faced similar problems with four of its five partner countries in Category 2, including the airline's home base, El Salvador, for almost the past two years. The airline as a result had to withdraw its anti-trust immunity application to work with American Airlines.

TACA chief executive Federico Bloch says that following an overhaul of local regulatory laws "we're very optimistic El Salvador will be in Category 1 by the summer and also probably Guatemala".

Source: Flight International