Category Archives: Avianca (Costa Rica)

Avianca plans to emerge from Chapter 11 reorganization before the end of the year

Avianca (Costa Rica) Airbus A320-233 N493TA (msn 2917) LAX (Michael B. Ing). Image: 955533.

Avianca has announced that following its submission of additional documentation that had been requested by the United States Court for the Southern District Court of New York– the Court has confirmed Avianca’s Plan of Reorganization­*i. The Company expects to successfully complete its court-supervised reorganization and emerge from Chapter 11 before the end of the year as a more efficient and financially stronger airline, well positioned for long-term success.

Upon emergence, the Company will have a solid balance sheet, with significantly reduced debt and over $1 billion in liquidity. Avianca’s restructuring will enable the Company to continue repositioning and simplifying its business, re-establishing as the carrier of choice in Latin America by adopting more competitive pricing for clients, reconfiguring aircraft with best-in-class modern seating, expanding network routes both domestically and internationally, refinancing its aircraft portfolio and obtaining long-term financing commitments. Avianca will keep the airline’s differentiating and competitive assets, which include a robust network, one of the best loyalty programs, VIP Lounges, signature services and one of the most competitive cargo solutions in the region.

Business Plan:

Avianca’s updated business plan impacts all facets of operations – the destinations Avianca will serve, the aircraft Avianca will operate, and the way Avianca will serve customers – to build on its leadership position and drive its future success.

Notably, the business plan projects:

  • A financially viable and stable airline;
  • Higher network density with a passenger fleet of more than 130 aircraft flying over 200 largely point-to-point routes by year-end 2025, with expanded service across Latin America as demand fully recovers;
  • A leaner cost structure providing both better pricing and more direct service, while enabling growth into new markets; and
  • Continued growth of the air cargo and LifeMiles loyalty businesses, building on the Company’s already well-established market positions.

Avianca’s Business Vision Milestones:

Over the course of 2021, Avianca has made significant progress on its new business vision in three key areas: strengthening its network, redesigning products and enhancing services. Certain milestones that the Company has already successfully achieved include:

  • A stronger network: Announced 23 new point-to-point routes in strategic markets for 2022, including ColombiaEl SalvadorGuatemala and Costa Rica. Avianca plans to operate more than 100 new routes in the next three years. 
  • Cabin reconfiguration: Incorporated more seats to offer more competitive prices and increase the number of passengers carried. The capacity of each aircraft will be increased by up to 20%.
  • Tailor-made service bundles: Provided customers with better flexibility to manage their flights and services so they only pay for what they really need.
  • Better self-service: Strengthened online customer service, its chat service “Vianca” and digital channels so that passengers can manage their trip more easily from the mobile application and Avianca’s website.
  • A rewarding LifeMiles program: Introduced a new mileage accrual model and more benefits for loyalty program travelers.

Top Copyright Photo: Avianca (Costa Rica) Airbus A320-233 N493TA (msn 2917) LAX (Michael B. Ing). Image: 955533.

Avianca (Costa Rica) aircraft slide show:

Avianca (Costa Rica) aircraft photo gallery:

United Airlines expands partnership with Copa Airlines and Avianca

United Airlines Boeing 777-224 ER N78017 (msn 31679) (Star Alliance) LHR (Keith Burton). Image: 944609.

United Airlines today announced it has reached an agreement with Compañía Panameña de Aviación S.A. (Copa Airlines), Aerovías del Continente Americano S.A. (Avianca) and many of Avianca’s affiliates, for a joint business agreement (JBA) that, pending government approval, is expected to provide substantial benefits for customers, communities and the marketplace for air travel between the United States and 19 countries in Central and South America.

Many more choices for customers

By integrating their complementary route networks into a collaborative revenue-sharing JBA, United, Avianca and Copa plan to offer customers many benefits, including:

  • Integrated, seamless service in more than 12,000 city pairs
  • New nonstop routes
  • Additional flights on existing routes
  • Reduced travel times

Drive economic benefits for consumers and the communities we serve

The carriers expect the JBA to drive significant traffic growth at major gateway cities coast to coast, which is expected to help bring new investment and create more economic development opportunities. Further, the JBA is expected to provide customers with expanded codeshare flight options, competitive fares, a more streamlined travel experience and better customer service, resulting in significant projected consumer benefits.

Better serve our customers

Additionally, allowing the three carriers to serve customers as if they were a single airline is expected to enable the companies to better align their frequent flyer programs, coordinate flight schedules and improve airport facilities.

“This agreement represents the next chapter in U.S.-Latin American air travel,” said Scott Kirby, United’s president. “We are excited to work with our Star Alliance partners Avianca and Copa to bring much-needed competition and growth to many underserved markets while providing a better overall experience for business and leisure customers traveling across the Western Hemisphere.”

“We are delighted to further solidify our existing partnership with United Airlines and look forward to increasing service options for our customers by working more closely with Avianca,” said Pedro Heilbron, Copa Airlines’ chief executive officer. “We believe this agreement benefits our passengers by providing competitive fares and a superior network of more than 275 destinations throughout Latin America and the U.S., and promotes further growth and innovation within the airline industry in the Americas.”

“We are certain that together we are stronger in the United StatesLatin America market than any of the three airlines individually,” said Hernan Rincon, Avianca’s executive president – chief executive officer. “This partnership will allow Avianca to strengthen its position as a first-level player in the airline industry in America as we will expand our scope in the continent with United and Copa, offering better connectivity to our customers.”

JBAs drive competition that benefits customers

Although JBAs have been proven around the world to benefit consumers and enhance competition, currently 99 percent of the U.S. carrier passenger traffic that makes connections in Central and South America does so without a JBA. Competition in the U.S.-Latin American market has grown and includes a diverse set of carriers offering service across multiple price points. Yet the market lacks a comprehensive revenue-sharing, metal-neutral network of carriers and the associated heightened competitive forces that drive value and better consumer experiences. The JBA represents an innovative, best-in-class new product offering that will make competition in this robust market even stronger.

“Our analysis shows that a metal-neutral JBA among United, Copa and Avianca will provide substantial benefits to consumers traveling between the relevant countries,” said Dr. Darin Lee, executive vice president of economic consulting firm Compass Lexecon and airline industry expert. “This JBA will enable United, Copa and Avianca to compete more effectively, offer competitive fares, and increase service, encouraging innovation and establishing a more robust and vibrant marketplace.”

To enable the deep coordination required to deliver these benefits to consumers, communities and the marketplace, United, Copa and Avianca plan to apply in the near term for regulatory approval of the JBA and an accompanying grant of antitrust immunity from the U.S. Department of Transportation and other regulatory agencies. The parties do not plan on fully implementing the JBA until they receive the necessary government approvals. The JBA currently includes cooperation between the U.S. and Central and South America, excluding Brazil.  With the recently concluded Open Skies agreement between the U.S. and Brazil, the carriers are exploring the possibility of adding Brazil to the JBA.

Top Copyright Photo (all others by the airlines): United Airlines Boeing 777-224 ER N78017 (msn 31679) (Star Alliance) LHR (Keith Burton). Image: 944609.

United aircraft slide show (Boeing):

Avianca is coming to Chicago and Orlando with new routes

Avianca (Costa Rica) Airbus A320-233 N495TA (msn 3103) MIA (Tony Storck). Image: 926153.

The Avianca Group is adding new routes from Central America and South America to the United States. New daily service from Guatemala City to Chicago (O’Hare) will start on April 1, 2019. The new route will be operated by Avianca Costa Rica (formerly LACSA) and Airbus A320 aircraft according to Airline Route.

The carrier is also starting Guatemala City – Orlando service on August 2, 2018, three days a week, with Airbus A319s.

Additionally Avianca (Peru) will add the daily Lima – Orlando route on August 1, 2018 with Airbus A319 aircraft.

Finally Avianca (El Salvador) will add the San Salvador – Boston route on August 17, 2018. The route will be operated two days a week.

Copyright Photo: Avianca (Costa Rica) Airbus A320-233 N495TA (msn 3103) MIA (Tony Storck). Image: 926153.

Avianca (Costa Rica) aircraft slide show: