Threats to nix Mexico City’s new airport could have serious repercussions for Mexican aviation

Mexico City’s new airport has become a pawn in the country’s upcoming political elections, and the outcome could threaten the Mexico’s competitiveness in the country’s global aviation industry.

The left-leaning candidate, Andrés Manuel López Obrador, has pledged to cancel construction of the a new airport in Mexico City, which is scheduled to open in 2020.

Speaking at the CAPA – Centre for Aviation Americas Aviation Summit 2018 in Houston, Texas, USA, Volaris CEO Enrique Beltranena remarked the airport debate “has become the wall discussion”, referring to pledges during the 2016 US presidential campaign to build a border a wall between the US and Mexico.

Mr Beltranena stated the new airport’s runways could be completed by the end of this year, and the project is being managed with private financing instruments. He warned declarations of cancelling airport construction “mean you’re going against the financing system of the country”.

Volaris, which is Mexico’s second largest airline measured by domestic passenger share, stresses the country needs the new airport; however, due to the uncompetitive manner in which slots at Mexico City Juarez are allocated, Volaris only represents roughly 30% of capacity at the airport. He remarked Volaris has become profitable operating the vast majority of its capacity outside of Mexico City Juarez, which according to data from CAPA and OAG, is the airline’s third largest base measured by ASK deployment.

Most of Southwest Airlines’ current service to Mexico is to the leisure destinations of Cancun, Los Cabos and Puerto Vallarta. The airline does operate two daily flights from Houston Hobby to Mexico City Juarez, and Southwest chief revenue officer Andrew Watterson told attendees Mexico City will become more important to the company in the medium term as it turns some attention in international markets to visiting friends and relatives (VFR) and business traffic.

IATA Regional Vice President, The Americas, Peter Cerda warned canceling construction of the new airport in Mexico City could have “tremendous consequences on the country’s airlines and traveling public”.

Reuters has recently reported that Mr Obrador has a double digit lead in most major opinion polls.

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