Current Situation Will Set Copa Back Almost 30 Years

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When the current coronavirus pandemic ends, Copa Airlines will look more like the Copa of 28 years ago rather than the Copa of 28 days ago, said Pedro Heilbron, Copa Airlines CEO. He added that the Panamanian airline will have to adjust to a new size for the future.

Copa Airlines
How will Copa Airlines recover from the current crisis? Photo: Tomás del Coro via Flickr.

Zero demand

Pedro Heilbron gave an interview with the local TV channel, TVN. In the interview, he said that Copa Airlines has had zero demand since mid-March. The carrier hasn’t received any money and this situation is totally unsustainable, he added.

Panama was one of the first countries in Latin America to close its borders to better manage the coronavirus crisis. Copa Airlines temporarily suspended its operations from 22 March.

As of 16 April, Panama had 3,751 confirmed cases of coronavirus with 103 deaths. “We will work like never before to recover and reconnect the cities that welcomed us,” said Heilbron on 20 March.

He added that the airline would resume operations on 20 April, but this relies on factors outside of the airlines’ control.

Copa Airlines Getty
Copa Airlines stopped flying on 22 March. Photo: Getty Images.

Copa and Panama rely on international travel

In 2019, Tocumen International Airport received 16.5 million passengers. The majority of these passengers came from abroad as the airport is known as “America’s Hub”. Also, the biggest amount of traffic comes from transit passengers that don’t stay in Panama. Copa Airlines, for example, only has one domestic route to the city of David, in the west.

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Additionally, Copa Airlines flies to almost every country in the Americas. If we take into consideration the fact that international demand will take more time to recover, Copa Airlines won’t have a simple way out of this crisis.

Nor does Panama as a country. The country’s aviation sector employed more than 12,000 people in Panama in 2018. It also contributed approximately US$90.1 million or 14% of the GDP, according to IATA.

In 2017, Tocumen International Airport was one of the 50 most connected airports in the world. According to OAG, the hub is the fourth most connected in Latin America.

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Copa Airlines
Copa Airlines expects the recovery to happen in 2023 and 2024. Photo: Daniel Martínez Garbuno/Simple Flying

Heilbron not optimistic

“Two weeks ago, the experts predicted that the recovery of the air industry could begin at the end of 2022, but now the outlook is worse,” Heilbron said. According to Copa Airlines’ CEO, the recovery of the air industry could take up to three or four years.

This is why, the airline will have to adjust to a new reality, and a new size, to cope better with the lower demand.

Currently, Copa Airlines has a fleet of 106 aircraft. This includes a few Boeing 737 MAX that the airline grounded in March 2019. Maybe we’ll see the retirement of some of its older fleet, just as other airlines worldwide are doing.

Speaking of Copa Airlines 28 years ago, this is what was going on at the time: “In 1992, it began operating the first Panamanian headquarters for flights connecting withing Latin America, creating the Hub of the Americas.” During that year, Copa added flights to Caracas, Mexico City, Santiago de Chile, Cali, Bogota, Quito, Guayaquil, Lima, Buenos Aires, and Havana.

In a nutshell: 1992 was when Copa started to be the Copa we currently know. A setback due to coronavirus would mean that the airline would be back to basic services.

What do you think is going to happen with Copa Airlines? Let us know in the comments.

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