The airline industry in Mexico has recovered more than three-quarters of its pre-pandemic traffic levels between January and October 2021, according to data published by the Ministry of Infrastructure, Communications and Transport (SICT). Mexico’s recovery reaches 75%, and we expect a strong finish in 2021 due to a great domestic performance and a solid US-Mexico travel market. 

The domestic recovery

So far, the airlines that operate flights, both domestic and international, in the country have had more than 63.1 million passengers. As a comparison, in 2019, the barrier of 83.5 million travelers had already been surpassed by October. 

The domestic market has recovered 80% despite the cease of operations of Interjet. The remaining seven airlines have carried 35.3 million passengers so far this year. The market is still led by Volaris, with 14.4 million travelers; the airline has a 41% market share.

It is followed by Viva Aerobus, the low-cost airline that has positioned itself as the second most important in the domestic segment, transporting 9.9 million passengers. Grupo Aeroméxico, in third place, has taken 9.8 million travelers, according to the SICT. None of the remaining four (Aéreo Calafia, Aeromar, Magnicharters, and Transportes Aéreos Regionales) have exceeded 350,000 passengers so far this year.

The international market

However, in the international market, Aeroméxico continues as the leading operator. Aeromexico has carried 3.2 million passengers, followed by Volaris with 3.1 million, Viva Aerobus with 1.3 million, and Aeromar with 72,208. The recovery of this segment reaches 57.6% with respect to the pre-pandemic levels. Nonetheless, Viva Aerobus has had tremendous growth, increasing its international traffic levels by 375%! That’s an amazing performance. Viva Aerobus has opened up new international routes like Mexico City-Bogota. 

The Mexico-US market has recovered by 92%. The US carriers alone have regained 98% of their pre-pandemic traffic, benefitting from Mexico’s Category 2 with the Federal Aviation Administration. Delta-Aeromexico remains the top player in the binational market, but it is closely followed by American Airlines. 

In October of this year, American Airlines had a 17.3% share in the cross-border market, the largest among the operators in both countries, followed by United Airlines with 15.8, Volaris with 14.0, Delta Air Lines with 10.5%, and Aeroméxico with 8.4%.

Until October 2021, the US carriers operating flights to Mexico had transported 16.8 million travelers, against the 17.2 million they already had registered in the first ten months of 2019.

The number of passengers transported by national and foreign companies to and from the United States in scheduled commercial service has had six consecutive months above the pre-pandemic levels of 2019. 

Latest developments

Both Volaris and Grupo Aeromexico published their latest traffic results earlier this week. 

Volaris has carried 21.8 million passengers between January and November 2021. That number alone is almost 100% from what the airline had in the entire 2019 when it took 21.9 million travelers. Volaris is set to finish the year with more passengers than before the COVID-19 pandemic. 

Additionally, Volaris introduced yesterday its 100th aircraft. It is an Airbus A320neo, registration XA-VSH. Volaris expects to finish 2021 with 101 aircraft and 2022 with 113. Volaris will use this plane on the domestic services Bajío-Tijuana and Cancún-Tijuana. The Airbus A320neo will allow a 22% and 33% increase in the frequencies of these two routes.

Meanwhile, Aeromexico has recovered 95% of its pre-pandemic traffic numbers as of November. Last month, the flag carrier had 2.2% more domestic passengers than in 2019, while the international market remains 20.2% down. Earlier this week, the US Court approved Aeromexico’s Exit Financing plan in its Chapter 11 process. The judge will oversee a hearing to approve Aeromexico’s Plan of Reorganization in mid-January 2022.

Strong finish

With the holiday season around the corner, Mexico will finish the year on a high note. Then, in January and February, it will have its historic decline in traffic numbers. The arrival of the fourth wave of COVID-19 infections could hamper the recovery as well.

Viva Aerobus and Volaris have not found a ceiling to their growth yet. They are benefiting greatly from the exit of Interjet and Aeromexico’s Chapter 11. Meanwhile, Aeromexico is near exiting its bankruptcy process in the US. The flag carrier intends to use Mexico City Airport as its primary growth strategy going forward. 

Nonetheless, 2022 will be a year to closely follow the Mexican airline industry. There are two main reasons: 

  1. The inauguration of Mexico City’s new Felipe Ángeles International Airport. The Government won’t risk having a second white elephant (Toluca, from a commercial airline point of view, is the other one). So far, only Volaris and Viva Aerobus have announced routes from this new airport, with two apiece. 
  2. The FAA’s recertification of Mexico and possible regaining of Category 1 status. Mexican authorities believe Category 1 status will be regained during 2022’s first quarter. Nevertheless, they are on the clock, and the longer it takes, the more likely it is that the Mexican carriers operating in the US will suffer the consequences.
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