Viva Aerobus Sees Big Growth Potential Between Smaller Mexican & US Markets

Viva Aerobus CEO Juan Carlos Zuazua said the biggest benefit of the Mexican ULCC’s proposed transborder joint venture (JV) with US ULCC Allegiant Air will be the ability to connect smaller markets across the border.

“It’s a great opportunity to connect small and medium [US] cities with Mexico’s beaches nonstop without passengers having to change flights in a big city like Atlanta (ATL),” Zuazua told the Routes Americas conference Feb. 15 in San Antonio, Texas. He added: “Don’t worry, we’ll connect the big cities as well.”

Zuazua said the target Mexican cities for US passengers flying via the Viva-Allegiant JV will be Cancun (CUN), Los Cabos (SJD) and Puerto Vallarta (PVR). “Many people in the US are going to fly nonstop to these beaches,” Zuazua said. “You can’t beat less than a 2 hr. flight without a connection to these beautiful destinations in Mexico.”

He added: “We’re hoping [the JV] will get approved [by regulatory authorities] very fast.”

Viva, meanwhile, has been growing fast despite the COVID-19 pandemic. While the Mexican government didn’t provide aid to airlines, as was the case in the US and much of the world, the government did keep Mexico open with few restrictions. As a result, the US-Mexico transborder market continued to perform relatively well throughout the pandemic.

“Mexico is the fastest recovering [airline] market in the Western hemisphere,” Zuazua said.

Also helping Viva, he noted, is the fact that so much office work has gone remote. “People are changing their home office to the beach,” Zuazua said.

Monterrey (MTY)-based Viva launched 30 new routes in 2021, including 15 to the US. Overall, the carrier now operates 125 routes, including international flights to Colombia, Cuba and the US. It has a 30% share of the Mexico domestic market and a 70% share of the Mexico international market.

The airline’s US flights are currently focused on major cities, including, among others, Chicago O’hare (ORD), Dallas (DFW), Los Angeles (LAX), Miami (MIA) and New York Kennedy (JFK). One relatively smaller market where Viva has had success is San Antonio (SAT).

“We’re the largest international airline in San Antonio with three routes” to Mexico, Zuazua said. The carrier operates 40 flights a week on its SAT-Mexico routes.

Viva, in applying to the US Transportation Department for approval of the proposed JV with Allegiant, noted that it has had “to quickly cancel leisure routes it introduced [between the US and Mexico] where most of the passengers were expected to originate in the United States,” citing a lack of brand awareness in the US the carriers believe the JV can help overcome.

Zuazua said there is a tremendous amount of growth potential between the US and Mexico–particularly between secondary markets–noting that about half of the 31 million annual international US air passengers travel to Mexico. ”There’s a huge market for everyone to participate in,” he said.