A bill proposing to charge $5 for each passenger in transit was presented, whose funds, which would reach $65 million, would be given to airlines as incentives to attract more tourists to the country.
Bill 150, called "Airline Incentive Law", was presented to the National Assembly on August 26. See full initiative.
The airline Aliana announced the cancellation of flight routes from Guatemala to the United States and Tegucigalpa, and from the capital of El Salvador to destinations in North and South America.
Some routes from Bogota, Guatemala and San Salvador will be canceled consisting of fleet changes and focus on routes with higher demand, the airline said in a statement.
Charges, taxes, high fuel prices and other costs at airport terminals can represent close to 30% of the value of air tickets in countries in the region.
Airlines that operate in the Latin American region face an uncompetitive market, since in 2018 these companies are projected to earn $2.95 per passenger, a figure much lower than the $15.67 estimated in North America or $7.58 in Europe, according to representatives of the International Air Transport Association (IATA).
In Panama, a tender is being launched for the supply of international and national air tickets for State entities for a period of two years.
Panama Government Purchase 2018-1-27-0-99-LM-001916:
"The lines to be offered correspond to regions or geographic zones.The proponents in the Economic Proposal Form must indicate in which lines they wish to participate.
The Mexican company Volaris has announced that from June it will start operating two new frequencies, from El Salvador to Nicaragua and Guatemala, and another one between Mexico and Guatemala.
Volaris reported that the first route will connect Guatemala and El Salvador, and the second Nicaragua and El Salvador, and a third will go between Guatemala and Mexico.
The Panamanian airline has presented a financial offer in cash and stock to acquire the second largest airline in the region after Latam Airlines.
The New York Times reported that the offer made by Copa Airlines consists of "... a merger that would value Avianca at more than $2 billion, or a 150 percent premium to its share price last week. [November 29]".
In five years the airline market in Central America has transformed from being a market dominated by two major airlines, to one with new entrants, lower prices and greater connectivity.
The arrival of so called "low cost" airlines to the region has resulted in a progressive reduction in the prices of tickets to fly between Central American countries. Between 2011 and 2014 the average cost without taxes for travelling between Costa Rica and El Salvador ranged from between $400 and $500, while in 2015 it costs $391.
Visitor spending went from $3.728 billion in 2014 to $4.2 billion in 2015, double the growth rate for the category in a year.
The entry of travelers into Panama grew by 6.9% at the end of last year, going from 6,668 in 2014 to 7,128 in 2015. This greater volume of passengers spent 12.7% more than they did in 2014, reaching a record high of $4,199.7 million, according to the National Institute of Statistics and Census.
The stock price of Copa Holdings has fallen and at the same time the airline has stopped accepting Argentina's currency for ticket sales.
Restrictions in Argentina for converting local currency to dollars and for sending funds abroad, have now forced American Airlines and Air Canada to take the same measure implemented by Copa.
The Directorate General of Public Procurement of Panama is putting out to tender the provision of air tickets for state institutions for the period 2015-2017.
Panama Government Purchase 2015-1-27-0-99-LM-001 194:
"TENDER UNDER THE CONVENTION FOR THE PROVISION OF AIR TICKETS FOR STATE INSTITUTIONS 2015-2017."
The date for receipt of bids is September 25th, 2015.
With the entry of two competitors focusing on the business of low-cost fares, the airline market in Central America is preparing for a potential price war.
Panama has become the starting point for tourists looking to travel to the rest of Central America, where new airlines want to capitalize on a market which so far has been driven Copa Airlines and Avianca.
Owners of VivaColombia and the mexican VivaAerobus have announced the opening of a holding company in Panama to start operations in Central and South America.
From a statement issued by Irelandia Aviation and Grupo IAMSA:
Irelandia Aviation and Grupo IAMSA, owners of the Mexican low-cost airline VivaAerobus and of the Colombian airline, VivaColombia, announced their intention to expand the Viva airline brand in Central and South America.
In the first seven months of the year 4,881,985 passengers transited through the international terminal in Panama, almost 10% more than in the same period in 2013.
From a statement issued by Tocumen International Airport:
During the first seven months of 2014, Tocumen International Airport which was recently given an award by the World Travel Awards, recorded an overall rate of 4, 881.985 passengers, compared with 4,454.529 users who used the Panamanian terminal in the same period in 2013, representing an increase of 9.6%, stated a report provided by the Department of Statistics.
Starting December 3rd United Airlines will have direct flights between Tocumen Airport and Denver airport in the USA.
From a statement issued by the Government of Panama:
The official announcement took place at the Marriott hotel in Panama City, where the CEO of United, Freddy Rodríguez said: "This initiative is very important because with it we are taking on challenges with this new destination, related to having a global reach and providing good service for our customers. "
Starting July 2nd the number of frequencies to the South American country will be reduced from 48 to 10 per week and flights from New York, Dallas and San Juan, Puerto Rico will be canceled, keeping only the Miami - Caracas route.
The reason behind the decision of the U.S. airline is the $750 million that the Venezuelan government owes, as it does to other airlines in the world, such as Alitalia, Copa Airlines and Air Canada, among others.