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AntonioMartin
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Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:25 am

Hi everyone...I always wondered what would be the chances of someday Puerto Rico having some airline come in and establish itself as the un-officlal flag carrier there, I thought it'd be interesting to see for example, TACA Puerto Rico. Now obviously it would have to be either Avianca, Copa or Latam...

Before you think its never gonna happen because of the political status, let me tell you that a little known fact is that the current governor Ricky Rossello's father, Pedro Rossello, was in talks with AeroMexico when he was governor himself to establish an Aero Puerto Rico ala Aeroperu.

Also there was once a Puertorriquena de Aviacion airlines. This airline operated in the 1940s with one airplane.
 
MAH4546
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:36 am

It's illegal because Puerto Rico is part of the United States. So it's never going to happen.
a.
 
phatfarmlines
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:56 am

MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.


The closest thing created to serve PR/VI domestic was Caribbean Sun, partially owned by Caribbean Star, during the 2000's, now both defunct
 
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Rajahdhani
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 6:11 am

There is also the issue of depending on a P.R. based O/D crowd, in the current P.R. economy. Couple that with improvements to various airports around the Caribbean (thus reducing the need for flights to feed into SJU to connect onto hubs/larger aircraft - et voila - neither the healthy enough O/D segment (needed to capture their premium yields capacity in catering to their local/business demand), nor does SJU provide a decent connection point for Caribbean/Central/Latin American traffic (as most of those markets can now support the aircraft/route capabilities to serve MIA, JFK et al, by themselves, non-stop).

B6 then further does a fantastic job of catering to the majority of the markets necessary for the O/D, by coincidentally having hubs at MCO, FLL, and JFK; points well within the top demanded from the local O/D.

Going back to it, consider not only how American Eagle, but rather, American Airlines as a whole, retreated from SJU to this current point. Further add how effective B6 has been/has grown, and even more impressively - will continue to grow in future.
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 11:27 am

MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.

Not illegal....unlikely, yes but not illegal.

Virgin America anyone??

So it could happen just as such airline (Air China Puerto Rico or whatever, :lol: ) complies with the rules and regulations of the USA>
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 11:28 am

Rajahdhani wrote:
There is also the issue of depending on a P.R. based O/D crowd, in the current P.R. economy. Couple that with improvements to various airports around the Caribbean (thus reducing the need for flights to feed into SJU to connect onto hubs/larger aircraft - et voila - neither the healthy enough O/D segment (needed to capture their premium yields capacity in catering to their local/business demand), nor does SJU provide a decent connection point for Caribbean/Central/Latin American traffic (as most of those markets can now support the aircraft/route capabilities to serve MIA, JFK et al, by themselves, non-stop).

B6 then further does a fantastic job of catering to the majority of the markets necessary for the O/D, by coincidentally having hubs at MCO, FLL, and JFK; points well within the top demanded from the local O/D.

Going back to it, consider not only how American Eagle, but rather, American Airlines as a whole, retreated from SJU to this current point. Further add how effective B6 has been/has grown, and even more impressively - will continue to grow in future.

Mucho correcto!!! :bigthumbsup:
 
toltommy
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 11:46 am

AntonioMartin wrote:
Not illegal....unlikely, yes but not illegal.


If the current aviation bilaterals do not legally allow it, then it would be illegal.

But it would be interesting to see an independent Puerto Rico (taking its debt with them, and no longer accepting US government aid) establish itself as a low tax center of commerce between North and South America, and an airline build a hub there to help turn SJU into a Caribbean Dubai. But I dont think Puerto Rico has the will to take such a leap.
A300/A310/A319/A320/A321/A332/A333 / 707/712/727/732/733/734/735/738/739/752/753
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ei a330-200
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 12:10 pm

I'm about 95% certain that any airline based in Puerto Rico would have to comply with US Airline ownership rules, which require at least 75% US ownership. This would put a damper on Avianca, LAN, or COPA owning/operating a Puerto Rico-based airline.
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 12:26 pm

ei a330-200 wrote:
I'm about 95% certain that any airline based in Puerto Rico would have to comply with US Airline ownership rules, which require at least 75% US ownership. This would put a damper on Avianca, LAN, or COPA owning/operating a Puerto Rico-based airline.

Yeah that can be the case....sucks when your country is just, politically speaking, a territory that cannot decide on much except who to send to sports or beauty contests...
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 12:28 pm

toltommy wrote:
AntonioMartin wrote:
Not illegal....unlikely, yes but not illegal.


If the current aviation bilaterals do not legally allow it, then it would be illegal.

But it would be interesting to see an independent Puerto Rico (taking its debt with them, and no longer accepting US government aid) establish itself as a low tax center of commerce between North and South America, and an airline build a hub there to help turn SJU into a Caribbean Dubai. But I dont think Puerto Rico has the will to take such a leap.

A bit off topic maybe but do you think US airlines would pull away from an independent Puerto Rico??
 
DLPMMM
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 1:27 pm

ei a330-200 wrote:
I'm about 95% certain that any airline based in Puerto Rico would have to comply with US Airline ownership rules, which require at least 75% US ownership. This would put a damper on Avianca, LAN, or COPA owning/operating a Puerto Rico-based airline.


It could almost work...as long as the new PR carrier's owner is from a country with Open Skies with the USA and as long as the new PR carrier does not fly to USA airports....all 5th freedom rights with no cabotage.

But I doubt there is enough market sans USA to make a go of it financially, but they could set us a hub in PR to cover the rest of the carribean and even connect to the EU and other places.
 
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chepos
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 1:33 pm

AntonioMartin wrote:
toltommy wrote:
AntonioMartin wrote:
Not illegal....unlikely, yes but not illegal.


If the current aviation bilaterals do not legally allow it, then it would be illegal.

But it would be interesting to see an independent Puerto Rico (taking its debt with them, and no longer accepting US government aid) establish itself as a low tax center of commerce between North and South America, and an airline build a hub there to help turn SJU into a Caribbean Dubai. But I dont think Puerto Rico has the will to take such a leap.

A bit off topic maybe but do you think US airlines would pull away from an independent Puerto Rico??


US Airlines fly to independent republics all over the world. Case in point, the fly to the neighboring Dominican Republic, a sovereign independent nation. In the event the island would ever gain it's independence, the Puerto Rican diaspora in the US is large (and growing), there would still be flights between key US cities and the island.
Fly the Flag!!!!
 
ahj2000
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 2:37 pm

chepos wrote:
AntonioMartin wrote:
toltommy wrote:

If the current aviation bilaterals do not legally allow it, then it would be illegal.

But it would be interesting to see an independent Puerto Rico (taking its debt with them, and no longer accepting US government aid) establish itself as a low tax center of commerce between North and South America, and an airline build a hub there to help turn SJU into a Caribbean Dubai. But I dont think Puerto Rico has the will to take such a leap.

A bit off topic maybe but do you think US airlines would pull away from an independent Puerto Rico??


US Airlines fly to independent republics all over the world. Case in point, the fly to the neighboring Dominican Republic, a sovereign independent nation. In the event the island would ever gain it's independence, the Puerto Rican diaspora in the US is large (and growing), there would still be flights between key US cities and the island.

Exactly. The traffic is mainly VFR and tourism, right? So the VFR, which grows daily as people quickly leave PR due to the recession, will still be there. The tourism might fall a hair, but I don't see much of a reason to halt or decrease service to PR.
-Andrés Juánez
 
pipeafcr
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 3:06 pm

PR is too risky (economy wise) for a LatAm airline to establish a subsidiary there.
Felipe Carrillo
 
dcajet
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 3:14 pm

For the purposes of aviation, PR is the USA. The best outcome to your idea would be a US based airline opening a hub like AA did in the 80s.

Now, assuming CM, LA or AV could get away with a SJU based subsidiary, what would it accomplish? Geographically, it is not ideally located and does not bring anything to the tabla; the economy in the island is on life support, etc, etc.
Keep calm and wash your hands.
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:11 pm

phatfarmlines wrote:
MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.


The closest thing created to serve PR/VI domestic was Caribbean Sun, partially owned by Caribbean Star, during the 2000's, now both defunct



There used to be Caribair which ran flights from MIA down to POS with stops at various points in the Caribbean including SJU, its base. They also ran flights from SJU to the DR, VI, and a variety of smaller islands as well. Eastern absorbed that carrier and establish an SJU hub,

Prinair was SJU based with flights to a variety of spots in the Eastern Caribbean.

That was then. I doubt any Puerto Rican or US investor will at this point establish a PR based airline. Correct that a foreign owned airline cannot be based in SJU.
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:12 pm

AntonioMartin wrote:
MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.

Not illegal....unlikely, yes but not illegal.

Virgin America anyone??

So it could happen just as such airline (Air China Puerto Rico or whatever, :lol: ) complies with the rules and regulations of the USA>



Virgin America isn't a wholly owned by foreigners.

https://en.wikipedia.org/wiki/Virgin_America
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:19 pm

AntonioMartin wrote:
ei a330-200 wrote:
I'm about 95% certain that any airline based in Puerto Rico would have to comply with US Airline ownership rules, which require at least 75% US ownership. This would put a damper on Avianca, LAN, or COPA owning/operating a Puerto Rico-based airline.

Yeah that can be the case....sucks when your country is just, politically speaking, a territory that cannot decide on much except who to send to sports or beauty contests...



As a state you wouldn't even have access to international sports or beauty contests. PR would have to compete against TX, NY, etc., in order to qualify to represent the USA.

Only an independent PR would be able to set its own rules about which carriers can be based there, but then they would have to negotiate route rights. B6 or other US carriers can deny access by this PR based carrier to the USA on the basis of insufficient ownership of that carrier by entities based in that country.
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:23 pm

pipeafcr wrote:
PR is too risky (economy wise) for a LatAm airline to establish a subsidiary there.



Not sure that it is the risk that is the issue. Various Latin American economies also periods of crisis, Brazil being the most obvious.

Its that it has intense competition by well established carriers and the yields aren't that good. That's why AA pulled down its SJU routes as they didn't feel for the price wars from the LCCs, especially WN and B6.
 
dcajet
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 4:57 pm

guyanam wrote:
Not sure that it is the risk that is the issue. Various Latin American economies also periods of crisis, Brazil being the most obvious.


Brazil has an extreme political crisis that has metastasized into an economic crisis, but it is far from being broke and is a world power. Puerto Rico, bless the island, is broke. Would it be an independent country, with a good deal of its inhabitants unable to make use of the US Welfare system, PR would be just another Caribbean island...
Keep calm and wash your hands.
 
MAH4546
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 6:20 pm

AntonioMartin wrote:
MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.

Not illegal....unlikely, yes but not illegal.

Virgin America anyone??

So it could happen just as such airline (Air China Puerto Rico or whatever, :lol: ) complies with the rules and regulations of the USA>


Virgin America was owned by Americans. It is absolutely illegal, sadly. It shouldn't be, but it is.
a.
 
phatfarmlines
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 6:46 pm

AntonioMartin wrote:
A bit off topic maybe but do you think US airlines would pull away from an independent Puerto Rico??


Absolutely not. I'm thinking if/when PR becomes independent, investors could use the DR model in adding all-inclusive resorts all over the islands, stirring up tourist demand not just from the US but also from Europe.

Also, an Avianca/Latam/dare I say even Norwegian - type established carrier in Latin America would be better positioned to add 5th freedom flights from an independent PR to/from US/Europe. PR can modify its cabotage rules just in the same manner Jamaica has modified its rules so Intercaribbean Airways, a Turks & Caicos based company, can fly MBJ-KIN with local traffic. Now I don't know if SJU is currently renovating the fomer AA hub concourses (D & E) as concourses B & C have been completed, but there is potential for expansion in the future without significant capital expenditures.
 
LimaFoxTango
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Re: Avianca, Copa or Latam Puerto Rico

Sun Aug 20, 2017 11:36 pm

phatfarmlines wrote:
MAH4546 wrote:
It's illegal because Puerto Rico is part of the United States. So it's never going to happen.


The closest thing created to serve PR/VI domestic was Caribbean Sun, partially owned by Caribbean Star, during the 2000's, now both defunct


Caribbean Sun, at least on paper, was actually headquartered in Fort Lauderdale. Caribbean Star itself never owned any part of Sun. R Allen Stanford owned both airlines, but were operated quite separately until the latter days of both airlines. Both airlines were eventually shut down with LIAT taking over the assets of Star (LIAT did NOT buy Star). The remnants of Sun somehow evolved into World Atlantic Airways under new management.
You are said to be a good pilot when your take-off's equal your landings.
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 2:34 am

guyanam wrote:
AntonioMartin wrote:
ei a330-200 wrote:
I'm about 95% certain that any airline based in Puerto Rico would have to comply with US Airline ownership rules, which require at least 75% US ownership. This would put a damper on Avianca, LAN, or COPA owning/operating a Puerto Rico-based airline.



As a state you wouldn't even have access to international sports or beauty contests. PR would have to compete against TX, NY, etc., in order to qualify to represent the USA.
:checkmark:

guyanam wrote:
Only an independent PR would be able to set its own rules about which carriers can be based there, but then they would have to negotiate route rights. B6 or other US carriers can deny access by this PR based carrier to the USA on the basis of insufficient ownership of that carrier by entities based in that country.
:checkmark:
 
Planeflyer
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 3:18 am

Don't know about legal issues but to motivate an airline to focus on PR, PR is going to have to get its act together.

Business climate is terrible and as far as tourism goes there are so many better options nearby.

I wish it weren't the case but PR is trapped w high costs and very mediocre attractions.
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 4:47 am

Planeflyer wrote:
Don't know about legal issues but to motivate an airline to focus on PR, PR is going to have to get its act together.

Business climate is terrible and as far as tourism goes there are so many better options nearby.

I wish it weren't the case but PR is trapped w high costs and very mediocre attractions.
:checkmark:
 
AntonioMartin
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 4:50 am

But it could in theory happen, provided the airline is 75% owned by Puerto Rican or American capital..and the rest provided by the naming airline....
 
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usxguy
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 4:56 am

Puerto Rico has already tried the all-inclusives; it doesn't work under the PR/US labor laws and food safety laws.

Even Hyatt hasn't torn down the old Dorado Beach hotel - its clearly visible when you stay at the Hyatt timeshare property located right next to it. In fact, if you swim in the pool, you can see the old water slides behind the green fence.
xx
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 5:05 pm

dcajet wrote:
guyanam wrote:
Not sure that it is the risk that is the issue. Various Latin American economies also periods of crisis, Brazil being the most obvious.


Brazil has an extreme political crisis that has metastasized into an economic crisis, but it is far from being broke and is a world power. Puerto Rico, bless the island, is broke. Would it be an independent country, with a good deal of its inhabitants unable to make use of the US Welfare system, PR would be just another Caribbean island...


.The issue with PR isn't its economic conditions as El Salvador isn't in great shape but yet used to have TACA and now has AV with a hub there. Puerto Ricans, even in their current state, are better off than are Salvadorians and a much larger VFR market exists in the USA in addition to more business travel.

The problem with SJU is that there is little traffic for travel to points other than the USA and the fact that PR is poorly integrated into the rest of the Caribbean or South America means that there is no potential for it to be developed as a hub. That ship has long sailed.

In addition SJU is a very low yield market and one with intense competition to the USA, hence AA sharply cutting back it service. B6 and WN have expanded their service into PR so its not that no one is traveling. A HUGE VFR market exists and grows every time a Puerto Rican moves to FL, NC or TX.

Its for that reason that it makes no sense for LATAM Puerto Rico to exist because it is not worth their while finding US investors to allow this to happen if the only market which exists is on routes where B6 and WN are well established.

.PR isn't as ahead of the rest of the Caribbean as you would think. In fact as of now Puerto Ricans are headed to the DR looking for work! And I don't see that becoming a state will change their circumstances as the Federal government isn't going to provide them with the supports that France provides Martinique. PR and the USVI had easy access to US capital markets which encouraged fiscal irresponsibility of a scale not seen in the rest of the Caribbean. Now they cannot even pay their civil servants.
 
guyanam
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Re: Avianca, Copa or Latam Puerto Rico

Mon Aug 21, 2017 5:14 pm

usxguy wrote:
Puerto Rico has already tried the all-inclusives; it doesn't work under the PR/US labor laws and food safety laws.

Even Hyatt hasn't torn down the old Dorado Beach hotel - its clearly visible when you stay at the Hyatt timeshare property located right next to it. In fact, if you swim in the pool, you can see the old water slides behind the green fence.



All inclusives only make sense in places which are perceived to be dangerous, as in Jamaica, Mexico, or the DR, or where tourism infrastructure is lacking, as in Cuba. There is no reason for PR to run into that end of the market as the bucket and spade set are very low yield and price conscious. The upper end of the market doesn't vacation in the same places where "the help" is likely to go.

The biggest problem with PR is that easy access to bond markets funded the operations of the local government and allowed them to hire far more people than was needed. In addition in times past fiscal incentives encouraged the development of an industrial base, though this is gone now that these incentives no longer exist. They didn't do what they needed to do to develop a competitive tourism product. They cannot compete with the DR and Cuba but then other options exist. But shoddy product and under promotion isn't going to cut it.
 
Brickell305
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Re: Avianca, Copa or Latam Puerto Rico

Tue Aug 22, 2017 1:04 pm

Why would any airline start a LATAM Puerto Rico? Any PR based airline would be subject to US ownership rules. If you wanted to operate an airline with strong connections to LATAM/the Caribbean, you'd be better off starting a LATAM Miami or NYC. The Puerto Rico-Latam/Caribbean market is small. Most of the demand is domestic to/from the US. The closest thing we've seen to a major hub in SJU was what AA used to operate until 2008. That operation has of course been drastically drawn down. B6 operates a focus city which is shell of what AA's hub operation used to be and is unlikely to grow much more. There'd be no room or market for a LATAM/Copa/Avianca/Whatever Puerto Rico.

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