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Mexico Puts Off Open Skies With U.S  
User currently offlineLaxintl From United States of America, joined May 2000, 26145 posts, RR: 50
Posted (7 years 4 months 2 weeks 1 day 17 hours ago) and read 2313 times:

No surprise here as Mexico has previously indicated its reluctance to liberalise its bilateral agreements with the US or Canada much further.

Quote:
Mexico Puts Off Open Skies With U.S.
08/08/2007


The head of Mexico's department of transportation (SCT) said open skies with the U.S. would happen only after the results emerge from a new plan to bolster the country's commercial aviation industry and would not come before the end of the six-year period of the current Calderon administration.

SCT's plan provides for domestic airlines to consolidate, operate in the black and have enough revenues to invest in order to compete more fairly in Mexico and abroad.

Transportation department head Luis Tellez acknowledged that the country's civil aviation, especially legacy carriers Aeromexico and Mexicana, are going through a turbulent period. "It's high time that our airlines implement much-needed adjustments in operations...to become more efficient and profitable," he told El Universal.

Pilots union (ASPA) Secretary General Dennis Lazarus warned that if the federal government opens the skies in today's conditions, "our air space would cease being Mexican and thousands of jobs would be lost."

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From the desert to the sea, to all of Southern California
6 replies: All unread, jump to last
 
User currently offlineJuventus From United States of America, joined Dec 2004, 2835 posts, RR: 2
Reply 1, posted (7 years 4 months 2 weeks 1 day 16 hours ago) and read 2225 times:

There were articles on newspapers Reforma and El economista about 4-5 days ago. It said Mexico was not going to allow foreign airlines, specially the US airlines to have an 'open skies' access to the Mexican skies. At least not until Aeromexico and Mexicana were operating in the black, and all the Mexican start-ups were established. It also said it was the Mexican Government's responsibility to protect them.

I bet AM and MX will welcome the news.


User currently offlineLaxintl From United States of America, joined May 2000, 26145 posts, RR: 50
Reply 2, posted (7 years 4 months 2 weeks 1 day 12 hours ago) and read 2123 times:

In many ways protecting AM and to a lesser extent MX stave's off the inevitable and ends up hurting both the consumer and Mexican economy in the mean time.

Quite clearly the Mexican aviation scene is under going a transformation and the legacy carriers including their unions must learn to adapt if they wish to survive.

By holding back liberalisation the government manages to lessen the much needed market forces that would help create the impetus for such changes.

In addition consumer are left with less choices and competitive options in the mean time (trans border fares are still rather high on comparable distance basis), while potential US dollars are left at home not spent as people are not drawn down by new routes, added services and competative pricing.

For a great example of what can happen in a country that embraces open markets look at Turkey. In the last 5 years domestic travel has sky rocketed by 300% allowing people to fly places instead of taking the bus, while international travel has increased near 100% during the same time frame. The formerly state owned and inefficient Turkish Airlines learned what it needed to do and has prospered while numerous up starts have successfully entered the market as well.

In other words, I'd say Mexico as a whole has more to gain by further liberalisation the aviation sector then by continued codling of its aviation industry over fears of "big brother to the North".



From the desert to the sea, to all of Southern California
User currently offlineKLM685 From Mexico, joined May 2005, 1577 posts, RR: 18
Reply 3, posted (7 years 4 months 2 weeks 1 day 11 hours ago) and read 2039 times:

Quoting Laxintl (Reply 2):
In many ways protecting AM and to a lesser extent MX stave's off the inevitable and ends up hurting both the consumer and Mexican economy in the mean time.



Quoting Laxintl (Reply 2):
In other words, I'd say Mexico as a whole has more to gain by further liberalisation the aviation sector then by continued codling of its aviation industry over fears of "big brother to the North".

While you are right "business speaking", the open skies with the U.S. would be a DISASTER for the actual structure of the Mexican airlines.

The right direction is to put pressure on the Mexican legacies for them to improve faster and by consequence gain consumer benefits and company profits. BUT an Open Skies would not be pressure but a bomb to the airlines.

Even if the bilateral had green light, some airlines would already be shaking. Aeromexico would probably subsist as they have ilimited amount of money (government owned, etc...). But it would be uncertain as if Mexicana and friends would be able to give battle to the slow but consistent entrance of US airlines.

Maybe six years is too much waiting for the Mexican legacies to get back to efficiency, but talks for the open skies should start in no more than three years. If and only if in this period our legacies haven't improved, then it means that we're still in the middle age regarding airline business.



KLM- The Best Airline in the World!
User currently offlineADXMatt From United States of America, joined Jul 2006, 954 posts, RR: 1
Reply 4, posted (7 years 4 months 2 weeks 1 day 8 hours ago) and read 2001 times:

Has any US Carrier been denied rights to serve new city pairs or add frequencies?

US Carriers add city pairs all the time. F9 anounced some this week.

Maybe MEX/GDL might see resistance but any others?

Open Skies would lower fares some but I don't think there would be a stampede to add service.

Just my 2 cents.


User currently offlineJuventus From United States of America, joined Dec 2004, 2835 posts, RR: 2
Reply 5, posted (7 years 4 months 2 weeks 1 day 4 hours ago) and read 1961 times:

Quoting ADXMatt (Reply 4):
Has any US Carrier been denied rights to serve new city pairs or add frequencies?

Probably not. The reason because when a route is full, why even bother applying....but if an open skies treaty was signed, CUN, MEX and SJD would be over flooded with flights from everywhere inmediately. This would not be good at all for AM and MX.


User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4136 posts, RR: 9
Reply 6, posted (7 years 4 months 2 weeks 21 hours ago) and read 1834 times:

Quoting Laxintl (Reply 2):
In many ways protecting AM and to a lesser extent MX stave's off the inevitable and ends up hurting both the consumer and Mexican economy in the mean time.

It really depends on what city pairs and routes they decide to restrict. How does Mexico's transportation regulatory agency determine U.S. or Canadian flag operator frequency between city pairs? I would think it would be economic suicide for Mexico to try and force Americans or Canadians onto AM or MX during the winter tourist months to places such as CUN, PVR, MZT, ACA, SJD etc... The number of Canadian charters and U.S. Flag carriers I see at these places during the winter suggest they at least know they need the $$$.

Quoting Juventus (Reply 5):
Probably not. The reason because when a route is full, why even bother applying....but if an open skies treaty was signed, CUN, MEX and SJD would be over flooded with flights from everywhere inmediately. This would not be good at all for AM and MX.

MEX perhaps, but CUN and SJD are so leisure oriented, and most U.S. or Canadian leisure travelers would rather use their own flag carriers for such routes (Canadians have the cheap charters!).



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