Aeromexico reports improved domestic performance in late 2020

Rising COVID-19 cases in Mexico threaten signs of progress, however.

Aeromexico saw some encouraging signs in Mexico’s domestic market at the end of 2020, but like most countries worldwide, Mexico’s recovery from the COVID-19 pandemic appears choppy.

“During the fourth quarter, the company saw some recovery in travel demand supported by the strengthening of its domestic network,” Aeromexico stated. The airline's domestic capacity increased by 35.2% from Q3 2020 to Q4.

But it remains to be seen if that recovery will stick. Mexico’s largest domestic airline measured by passengers carried, ULCC Volaris, recently cited elevated COVID-19 case counts in Mexico as an operating challenge in Q1 2021, and noted it expects booking curves to compress.

Data from the The Johns Hopkins Coronavirus Resource Center show that, at the end of December, Mexico’s daily COVID-19 case counts were 12,159 before jumping to 26,626 on Feb. 5. By Feb. 17, daily cases had dropped to 21,898, but were still well above year-end 2020 levels.

Aeromexico is in the process of rightsizing its operations. The airline's fleet fell from 125 aircraft at the end of 2019 to 106 at the end of 2020. The airline shed nine Embraer 170s, six Boeing 737-700s and nine 737-800s in 2020. Five of its six 737 Max 8 aircraft resumed operations in December.

Aeromexico also previously said it was expanding and adding back some US transborder routes, but the recently introduced requirement by the US mandating that international passengers entering the country complete a negative COVID-19 test within 72 hours prior to departure is weakening transborder demand.

Volaris recently stated it expects a short-term reduction in transborder demand, and has opted to slow its capacity growth in the current quarter.

Photo credit: Joe Pries