State-owned Venezuelan flag carrier Conviasa stands to gain from tighter controls on Venezuela's privately owned airlines. The latest move follows an audit of domestic fares charged by private carriers.
The national institute of civil aviation, INAC, introduced fare regulation in mid-2005, shortly after Conviasa's launch. Airlines have complained that the new fare limits are below their costs. They also complain about currency controls that hinder ordering spare parts offshore. INAC found in its recent audit that Aeropostal and Aserca, two of Venezuela's leading private airlines, exceeded approved fares on the important Caracas-Maracaibo route. This is Venezuela's highest yielding route because of oil industry business traffic.
Nelson Ramiz, Aeropostal president, called INAC's actions "slanderous propaganda" |
INAC imposed two penalties. First, it ordered the two carriers to refund the excess to its passengers. As a harsher measure, it also took from each carrier half its daily frequencies on the route.
Finally, INAC awarded an additional daily flight to Conviasa, giving the government-owned carrier five weekday frequencies on the Maracaibo route. Its fares are half those of the private carriers.
INAC has also suspended one of Aeropostal's frequencies to Barcelona, citing unspecified service deficiencies. This prompted Nelson Ramiz, Aeropostal's president, to call INAC's actions "slanderous propaganda".
These events coincide with President Chavez's promise to complete his socialist revolution by nationalising parts of Venezuela's economy. In January Chavez announced a state takeover of the telecommunications and electricity sectors. In February the president declared that the state-owned oil firm would take majority control of four foreign oil projects.
The Chavez government has also authorised a state government to take over the Caracas city airport at Charallave. Under its decree, the state cites a need to expropriate the airport to stop contraband.
Despite assurances by Chavez that he will not attack Venezuelan private property, the private carriers are worried about their future.
Source: Airline Business
