In the first quarter of the year, interest in air travel increased in all Central American markets, a rise that was most evident in Honduras and Guatemala.
Through a system that monitors in real time changes in consumer interests and preferences in Central American countries, developed by CentralAmericaData, it is possible to project short and long term demand trends for the different products, sectors and markets operating in the region.
As of March 28th, the Colombian airline will begin to reactivate flight routes connecting Central American countries with North American and South American nations.
After several months without arriving in the country due to the covid-19 outbreak, Copa Airlines will resume flights to Managua starting January 20 and will do so on a weekly basis.
The plans of the Panamanian airline is to operate during January a weekly frequency on Wednesdays, informed Carlos Schütze, vice president of the National Chamber of Tourism of Nicaragua (Canatur).
In the context of the economic reopening, it was announced that as of October 15, Costa Rican air terminals will begin to receive flights carrying citizens from Central America and Panama.
Due to the covid-19 outbreak, air transport between Costa Rica and the other countries in the region has been interrupted since March. Seven months later, authorities removed the restriction and airlines will be able to begin operating these flights.
The constant resurgence of covid-19, the closure of international markets and the loss of consumer confidence, postpone the beginning of the recovery of the air industry, a process that is predicted to be long in the context of the new business reality.
According to the International Air Transport Association (IATA), in this context of business and economic crisis in a large number of countries at the global level, there is no evidence of strong growth in global demand for cargo and its progress continues to be an extraordinary challenge for airlines.
Restructuring of airlines, preference for direct flights, modifications in the routes operated and the use of smaller aircraft are some of the changes expected in the regional air market in the context of the new business normality.
Air traffic has virtually disappeared in the last three months, as governments in Central America have decided to close borders and suspend commercial flights to and from the region's airports as a result of the covid-19 outbreak.
In order to prevent the spread of covid-19, all international flights have been suspended since March 22.
Panamanian President Laurentino Cortizo reported through his social networks that "... As of Sunday, March 22nd at 11:59 pm (04H00 GMT on Monday), arrivals and departures of all international flights to our country will be suspended for a period of 30 days."
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 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.
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.
United Airlines, American Airlines and Air Canada have also suspended the sale of tickets for international flights to Venezuela.
The international airlines American Airlines, United Airlines and Copa Airlines have decided to temporarily cancel the sale of air tickets in Venezuela. The measure was taken due to the uncertainty generated over a multi million-dollar debt the government holds with some airlines and the changes that have been made relating to foreign exchange.
The Venezuelan state airline Conviasa is to start flying directly, starting in December, from Maiquetia airport to Tocumen and Augusto Sandino.
"On December 5 we will be flying from Maiquetia (the airport which serves Caracas) to Panama and on December 7 wewill be flying from Panama to Nicaragua," said Hebert Garcia, Minister of Water and Air Transport in Venezuela.
The abandonment of several routes by Avianca leaves, apparently, niches that could be used by new players.
An article in Elfinancierocr.com reports that "If all goes as planned, 2014 could see the start of operations by three new Central American airlines: Air Ticos, Ticas Airlines and Vuelos Económicos Centroamericanos (VECA). The new companies want to attend to the international passenger routes amid an industry dominated by giants such as Avianca, Copa Airlines, Delta and 20 other international airlines."