Trans World Airways' return to Mexico City with daily flights from St Louis and New Orleans underscores Mexico's need to reach some fundamental aviation decisions. The presence of yet another US carrier fuels Mexico's need to resolve the future of Aeromexico and Mexicana, which are caught up in a debate over ownership.
TWA's return to Mexico City after a three-year absence signals a new strategy by the St Louis-based carrier to expand north-south routes. Some will be seasonal to winter resorts in Mexico and the Caribbean, but the Mexico City service, as well as new flights to Puerto Rico, Nassau and the Dominican Republic, will be all-year round.
"Mexico City is part of our strategy to serve destinations that are both leisure and business-oriented," says TWA. The airline has no plans for further expansion in Latin America, but it could build capacity as demand grows to and from Mexico City.
Other pressures are mounting for a resolution of Cintra's future as a holding company for Aeromexico and Mexicana. Cintra has repeatedly postponed an initial public offering due to poor market conditions, but recent bidding on the first group of Mexican airports has breathed new life into the country's privatisation programme. The winning bid for 50 year concessions at nine airports was more than double the government's floor price. That could revive Cintra's float, prompting a decision on whether to offer separate shares in each of its airlines.
Mexico's leading travel agent, tourist and hotel associations have also joined the debate over Cintra's future. In notices published in Mexico's three largest newspapers, the groups complained about recent commission cuts by Aeromexico, Mexicana and their subsidiaries. The groups accused these airlines, all owned by Cintra, of monopolising 87% of the domestic aviation market. The associations urged President Zedillo to dissolve Cintra's monopoly, encourage more start-up carriers and offer incentives for independent airlines.
An independent, Transportes Aeros Ejecutivos (Taesa), had a setback in December when president Captain Alberto Abed was charged with tax fraud. These charges come as negotiations are being finalised on a restructuring that might let Taesa offer the first serious competition to Aeromexico and Mexicana in years.
Source: Airline Business
