The Colombian low-cost carrier Viva Air has an aggressive plan to expand in the next few years by receiving new airplanes, increasing its fleet to 50 units by 2025, pushing the Colombian city of Medellin into a hub, and lowering the fares across Latin America. Simple Flying spoke with Viva Air’s CEO, Félix Antelo, and this is what he told us.
Talk about the fleet
Currently, Viva Air has a fleet of 22 aircraft, all A320 family-based, according to Planespotters.net. In 2020, amid the COVID-19 pandemic, the Colombian low-cost carrier incorporated the first four A320neos into its fleet.
This year, the airline is incorporating six more A320neos. The plan is to end 2021, with a fleet of 25 aircraft, 15 A320ceos, and ten A320neos, said Felix Antelo.
Nevertheless, the ambitious plan of Felix Antelo doesn’t stop there. He said,
“We need to keep focusing and concentrating on what we need to succeed and keep reaching our goal, which is to have 50 aircraft by 2025. The order is there, and we have the aircraft coming over the next four years. We need to employ those 50 aircraft.”
Viva Air is using the current crisis to increase its market share in Colombia and Peru. The low-cost carrier has several advantages over its two main competitors, Avianca and LATAM, and one of them is the fleet commonality.
A low-cost carrier under the hub-and-spoke model?
The hub-and-spoke model is directly related to the legacy carriers, such as Emirates, which uses Dubai as a connection point worldwide. Turkish Airlines does the same through Istambul.
Nevertheless, we don’t think of the low-cost carriers under this model. But, Viva Air is challenging that assumption.
The airline will use Medellín as a hub to attract travelers from South and North America and distribute them.
For instance, this year, Viva is planning to launch new routes from Medellín to Mexico City, Cancun, and Orlando (plus a Bogota-Mexico City). Once these routes are out in the market, Viva Air would have doubled its international map route.
These new destinations will allow Viva to offer one-stop travel between Lima (Peru) and Orlando, for instance. Felix Antelo said,
“Our plan of international expansion starts right away, building a stronger hub and connecting via Medellin. So we’re gonna start connecting via Medellin, and you’re going to be able to fly from all these destinations to all of Colombia. In a maximum of two hours, you’re able to connect from Mexico City to Cartagena or from Orlando to Santa Marta, or from Cancun to Lima, via Medellin.”
He added that this hub-and-spoke model is unheard of in the low-cost segment. Nevertheless, Viva will be able to offer USD$200 flights between Lima and Cancun, tax included, and remain profitable due to its low-cost base.
The future of the low-cost has started
Latin America has great potential for the low-cost market, Antelo said. There is a unique opportunity for low-cost airlines like Viva Air to handle a grip in the market.
For instance, due to the COVID-19 crisis, Viva increased its market share in Colombia, and now it is the second most important airline after Avianca. It surpassed LATAM in the last few months, Antelo added.
“After every single airline industry crisis, the low-cost model grew. For example, after 2001, Southwest grew even stronger; after the financial crisis in Europe, Ryanair and EasyJet blossomed and took the business to the next level. In Mexico, the H1N1 crisis led to Volaris’s and Viva Aerobus’s growth. Now with this crisis, which is way worse than all of those combined, you have the blossoming of the low-cost model in the region.”
For instance, Mexico currently has two-thirds of its domestic market covered by two low-cost carriers; Chile also has one legacy airline and two low-costs; Peru and Colombia are also thriving similarly.
“It’s not a matter of the future. It’s happening right now, and I think it will only get stronger in the upcoming years,” Antelo said.
What do you think of Viva Air’s plans? Let us know in the comments.
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