Colombia’s airlines’ million-dollar losses

Although they rebounded slightly after the COVID-19 pandemic, Colombian airlines reported more than US$350 million in losses in the first half of 2022.

Avianca, the historic Colombian airline, was the worst hit, accounting for 75% of the sector’s losses.

After recovering, albeit unsustainably, its revenues after the pandemic, the government agency that controls aviation in the Latin American country, Aerocivil, warns that the sector is experiencing losses in the millions of dollars.

The increase in fuel prices caused, among other factors, by the international sanctions against Russia, the depreciation of the Colombian peso, and accumulated inflation of 8% have combined to generate millions of dollars in losses for Colombian airlines.

According to the Colombian civil aeronautics regulatory body, the country’s airlines recorded losses of COP 1.55 trillion (US$352 million), representing an increase of 9.4% compared to the same period in 2021.

The most damaged was the Colombian flag carrier Avianca, which concentrates about 75% of the total losses of the seven firms that reported their numbers to the agency. This company’s losses amounted to COP 1.11 trillion.

The second-most damaged was Viva Air -which in 2022 announced its merger with Avianca in the Abra conglomerate- whose losses were COP 172.24 billion.

Third place in losses goes to Latam Airlines Colombia, which recorded a negative balance of COP 163.8 billion.

Fourth place goes to EasyFly with COP 21.2 billion, followed by Copa Airlines Colombia with COP 18.9 billion.

According to local media, the report attests that commercial airlines face the fourth consecutive year of losses. In 2019, the negative balance reached COP 1.83 billion; in 2021, the losses constituted COP 1.42 billion.

In any case, the year with the most significant impact was 2020 due to the COVID-19 pandemic. In that period, the sector faced COP 2.73 trillion in losses.

In this scenario, companies such as Avianca and Viva Air are looking for alternatives to face the numbers and operate as a group under the name of Abra, something that will depend on the approval of the Aerocivil and that has provoked alert reactions in some figures of the country since it would imply that the companies concentrate 65% of the market.

The companies are looking for solutions to get out of their critical situation and have made several changes, from modifying some routes to lowering prices for their trips.

All this is amid constant discontent on the part of Colombian users, who denounce abuses and problems associated with overbooking tickets. The problem has reached Congress, which seeks to sanction overbooking and flight cancellations to end the lack of user protection.

With information from Sputnik

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