Chile-based JetSMART has talked a superb sport for awhile now. It has needed to develop all through South America, and it has successfully promised as a lot to its US accomplice, American. It has used a mixture of inner and exterior progress over the previous few years, and now it’s attempting to show exterior once more with a suggestion for beleagured Viva Air in Colombia.
JetSMART began in Chile in 2017, and it grew rapidly. It’s backed by Indigo Companions, the Invoice Franke-led group that’s behind Frontier, Wizz Air, and Lynx amongst others. On the finish of 2019, the airline picked up the carcass of Norwegian Air Argentina, apparently considering that going into Latin America’s most insane aviation market could be a superb plan. By January 2020, this was the airline’s route map.
Quick ahead to 2023 and you may see the airline has grown considerably.
In Argentina, it has moved its Buenos Aires operation from the secondary airport at El Palomar to the town’s two foremost airports, Aeroparque and Ezeiza. It has most lately began up a brand new Peruvian subsidiary which is slowly rising out of Lima. The airline lacks a big Brazilian presence in addition to one in Colombia, however it has the airplanes coming to rectify that.
As of now, JetSMART has 23 airplanes in service. Eight of these are A320s in Argentina with one other 3 in Chile. The remainder are A320neos or A321neos with probably over 100 extra on order, together with some A321XLRs to actually stretch these legs. (Aspect notice: I say “probably” as a result of the order is with Indigo Companions and it will possibly shift these airplanes round to its totally different corporations if it desires.) These airplanes are coming very quick, with 18 anticipated this 12 months alone.
Colombia, nevertheless, is a crowded market. In fact there’s the large boy Avianca which has turned itself right into a low-cost service after a visit by way of the chapter spa. And there’s LATAM which is in all places in Latin America. However there are additionally a number of little guys with totally different hopes and goals.
Seats Departing Colombia for Latin American Cities
JetSMART doesn’t even register on this chart, as a result of it’s so tiny at present. It has 1x every day from Cali that alternates between Antofagasta and Santiago in Chile. There’s additionally been flying to Santiago from each Bogotá and Medellín, however that isn’t within the schedule previous March as of now. However with Viva’s capability, JetSMART may swiftly be a participant. In fact, if Viva can’t make a go of it by itself, may JetSMART do higher?
JetSMART does have deeper pockets and it has an even bigger imaginative and prescient. There’s a motive it linked up with American to supply feed to that airline’s long-haul community. It sees alternative to grow to be a continent-wide low-cost operator that may be a reputable various to LATAM and Avianca. In truth, it already mentioned it meant to open a Colombia operation again in November, so this might simply be a chance to take out a big competitor and transfer in rapidly.
On paper it appears to be like good. Viva is about the identical dimension as JetSMART with 24 airplanes within the fleet, most in Colombia however a pair in Peru. It has an all-A320 and A320neo fleet, so it could match proper in… although Viva went with CFM for its engines and JetSMART went with Pratt & Whitney so it’s not an ideal match. That half appears to be like okay, however then there are the monetary points.
Viva is in dangerous form and has mentioned it wants a savior to maintain the airline alive. It simply filed for chapter safety to maintain it alive till somebody should buy it. That’s by no means a terrific signal, however it does imply that there’s actually just one query to reply… at what worth does it make sense for JetSMART? As a result of there’s all the time a worth the place it is smart.
Viva has already agreed to be acquired by Avianca. True, Colombia’s competitors regulator shot the merger down, however they’ve already gone again with cures to attempt to get it pushed by way of. That overview is ongoing, and it clearly doesn’t appear to faze JetSmart.
From a JetSMART perspective, I think about it thinks it may go in there, take over Viva, depart the airplanes which are worthwhile in Colombia, and take the remainder out into one other place that might higher use the capability. If the acquisition worth is correct, this might be a extremely stable option to get into the nation that it desires to enter anyway. In a way, that is like what it did in Argentina, selecting on the carcass of a nearly-gone airline.
Avianca gained’t like this one bit, however it isn’t clear if it will possibly get its merger pushed by way of anyway. Earlier than this announcement, it might need been a Sophie’s selection for the federal government… both enable the Viva merger with Avianca or let Viva die. Now, nevertheless, there is a chance to maintain Viva alive beneath the guise of one other low price operator. Certain, it’s not a Colombian airline so satisfaction would possibly get in the best way, however it a minimum of provides the regulators an choice that didn’t exist earlier than. And that’s in all probability not nice information for Avianca.