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Mexico: Slot concentration is “natural” – Aeromexico

By  |  March 8, 2016

Mexican carrier Aeroméxico’s president, Javier Arigunaga, has sought to justify his airline’s 46.9% dominance over the landing and take-off slots at the Mexico City International Airport (AICM) by claiming that this is natural for “full service” hub-and-spoke airlines. “This happens with similar airlines in airports throughout the world, so in some ways, concentration is natural to the model” he said.

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    The executive explained that the AICM acts as Aeromexico’s hub for connections and distribution of flights, while pointing out that so far this century 10 Mexican airlines have gone out of business, especially following the 2008 financial crisis. These included not only recent low-cost competitors, but also the country’s oldest airline, Mexicana de Aviación. “Few industries are like the airline industry, with such a large entry and exit of competitors” he added.

    Last week, Mexico’s competition commission COFECE released a preliminary finding on the lack of competition at the Mexico City airport, which it identified as a “key part of the sector, as it has the largest traffic concentration in the country, with over 37 million passengers each year, over half the national total.” The commission has indicated that there is “a low number of players” with two companies, Aeroméxico and Interjet, holding a combined total of more than 65% of landing and take-off slots, which causes higher prices and prevents innovation, harming consumers.

    Full content: La Jornada

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