Perfect storm hits Colombia’s Aviation Sector

An Ultra Air plane at Medellin’s José Maria Cordova airport during the certification process in early 2022. Photo: BES-Reporter

BOGOTA- Within a period of 5 weeks, two airlines in Colombia have had to throw in the towel and file for bankruptcy. It concerns two so-called Ultra Low Cost Carriers (ULCCs) Viva Air and Ultra Air, which together controlled more than 30% of the local market.

A year ago everything seemed to be going well, with big plans at both airlines. A sharp rise in the US dollar, while tickets are mainly sold in Colombian Pesos, combined with the increase in a tax on airline tickets from 5 to 19% seems to have contributed to the accelerated demise of both carriers. The loss of the companies comes precisely at one of the busiest moments in local air traffic, the Semana Santa.

A restart of Viva Air under the flag of the much larger Avianca is still being negotiated, but the chances of this are getting smaller by the day. Avianca and Viva Air indicated a long time ago that they wanted to merge, but the Colombian aviation authority took more than seven months to give its blessing to the merger. A restart of Viva seems more unlikely with every day passing, now that the Viva Air planes have been on the ground for more than a month, and have partly called back by the respective leasing companies.

Curacao and Aruba

Both Viva Air and Ultra Air had Aruba and Curaçao in their sights when it comes to flights from the cities of Bogotá and Medellín. For example, Ultra Air had already indicated at its foundation that it wanted to fly daily to Curaçao.

Remaining airlines, including Avianca, Latam, Easyfly, Satena and Wingo, are doing their best to transport as many of the thousands of stranded passengers as possible, especially within Colombia. Due to the busy days around Easter, there are currently very few seats available.

Many Colombians suspect Avianca to be in reality quite happy with the demise of two important competitors on the domestic routes.

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