Mexicana has seen its traffic fall by about 30% since the onset of the swine flu epidemic late last month.

A Mexicana spokeswoman says passenger traffic has been down 30% year-over-year since the beginning of the crisis.

In May of 2008, Grupo Mexicana carried 960,000 passengers, according to statistics from the Mexican DGAC. The group also carried 960,000 passengers in March 2009, the last month traffic data is available.

Mexicana began seeing a drop in demand in late April, prompting the carrier to cancel flights on a day-by-day basis. During the height of the epidemic in early May, Mexicana was cancelling roughly 50 flights per day. But in recent days demand has improved and the spokeswoman says the number of daily cancellations has been reduced.

While Mexicana has been cancelling flights every day it has not pulled out of any markets except those countries which closed its borders with Mexico. Four Latin American countries - Argentina, Cuba and Ecuador, Peru - banned flights to and from Mexico but Argentina, Ecuador and Peru have since lifted the restrictions.

The Mexicana spokeswoman says the carrier's Buenos Aires service resumed on Monday. She says the only Grupo Mexicana route currently not operating is Mexico City-Havana as Cuba has still not yet lifted its ban on flights to Mexico.

Mexico's other major carrier, Aeromexico, also has been cancelling flights on a day-by-day basis in response to slumping demand. But Aeromexico has not yet provided any information on how much traffic has fallen since the onset of the crisis or how many flights the carrier has been cancelling.

An Aeromexico spokeswoman says the carrier continues to serve all its markets and "we haven't cancelled any destinations".

She adds Aeromexico is resuming its Buenos Aires service today and resumed its service to Lima in Peru last weekend.

Early last week Mexico's SCT announced it was working on an incentive package aimed at helping the country's beleaguered airline industry. The SCT has not yet provided details on what kind of incentives it will offer but has said only airlines that do not have debts with the government and have sound medium to long-term business plans will be eligible.

The Mexicana spokeswoman says the carrier does not yet know the form or level of incentives. "Mexicana and Aeromexico are working on that face-to-face with the SCT," she says. "We don't know the details yet. They are working on it now."

The SCT says the incentives are needed to help airlines cope with what it calls a "delicate juncture" for the industry. It points out Mexico's carriers were already struggling to deal with the global economic downturn and the recent devaluation of the Mexican peso before the outbreak of swine flu, which has compounded the problems facing the country's airlines.

Source: Air Transport Intelligence news