The Mexican airline Aeromar could soon be folding, becoming the latest carrier to cease operations due to heavy debt after several years of crisis which can be traced even before the COVID-19 pandemic. Aeromar is an ATR-based carrier with a fleet of ten aircraft. It is the fourth most important operator in the country in terms of carried passengers behind Volaris, Aeromexico, and Viva Aerobus.

A bittersweet end?

Aeromar is owned by the Katz, a family of Mexican businessmen, but they have neglected the airline and have refused to invest in it since 2017. This has led to a prolonged crisis which has been recently fueled by the COVID-19 pandemic, the economic uncertainty, inflation, issues with its labor force, and the untimely departure of management personnel (this journalist knew at least three members of the airline, two of them senior, leave the company in the last couple of months).

According to local media outlets, Aeromar owes at least 70 million pesos (US$3.5 million) in fuel to the State fuel provider. The airline is also in heavy debt with its labor force (72 million pesos owed to the pilots) and an unspecified debt with Mexico’s tax authority. The issues surrounding Aeromar are strikingly similar to the ones faced by Interjet in 2020 before it ceased operations. Interjet is the only Mexican carrier to have folded during or after the COVID-19 pandemic.

El Financiero reported that if Aeromar does not pay its debts, it could face a shutdown as early as next month. The government could invoke its powers and remove Aeromar’s air operator certificate. Aeromar operates around 289 weekly flights. Unlike its counterparts, Aeromar has not recovered its pre-pandemic traffic levels.

Interjet
Interjet ceased operations in 2020. Photo: Getty Images.

Should the Mexican government invest in the airline?

So, what’s the future for Aeromar, the second-oldest airline in Mexico currently active (behind Aeromexico)? One possibility is it will disappear like Interjet in 2020. It will leave thousands of unemployed personnel, a fleet of ATR aircraft, and valuable slots in Mexico City Benito Juárez International (MEX), where it has up to 12 departures and 15 landings per day.

The other possibility is that the Mexican government rescues the airline. Recently, Mexico’s pilot union (ASPA) urged the government to stop the impact on the airline. The union urged the government to take an investment in the carrier, nationalizing it and rebranding it. It wouldn’t be the first time the Mexican government has done something similar. In the 80s and 90s, it did just that when Aeromexico and Mexicana de Aviación were bankrupt.

XA-UZS_ATR_72-600
Turboprops with their mostly straight wings are much twitchy in turbulence. Photo: Antonio Velasco Cruz via Wikimedia Commons.

A viable operator for Mexico City’s new airport?

A government-run Aeromar could be a perfect candidate for Mexico City’s new Felipe Ángeles International Airport (NLU). The airport still lacks a strong player; no Mexican airline has decided to fully move its services to the new hub.

ASPA’s general secretary, José Humberto Gual, recently said Aeromar could be the trigger for the Felipe Ángeles Airport to become a true hub because Aeromar has a robust regional connectivity across Mexico. The airline flies to cities like Puerto Vallarta (35 weekly landings), Guadalajara (30), Puerto Escondido (18), Zihuatanejo (17), Acapulco (16), and several international destinations such as McAllen, Havana, and Laredo.