Page 22 - AAA APRIL - MAY 2017 Online Magazine

FeAtUre LOW COST CARRIERS

Maintenance Repair Overhaul

oPPosite PAge: VivaAerobus has
earned a market share of 14 percent
since commencing operations in
November 2006
LeFt: VivaAerobus operates its
A320s in 182 seat configuration

digits over the last few years. Volaris, already got two of them; we were one of Controlling the Controllable
another low-cost carrier, has been spending the first operators in Latin America to get “Seventy five percent of our costs are
time and money on convincing people to them. We are doing an average of eight uncontrollable,” said Zuazua. “Fuel, airport
fly, even giving away tickets in order to sectors per day with the NEOs and are navigation and government taxes; there is
convert traditional bus travelers into new quite pleased with the engine performance.” very little that we can do about that. We have
customers. Being owned by Mexico’s largest Having a single aircraft fleet is crucial to 25 percent fixed costs; that gives us a lot of
bus company, VivaAerobus has an advantage the company’s plans, according to Zuazua. flexibility.” Ancillary revenue accounts for
over other carriers, something that it has “You have a lot of simplicity in operations. as much as 41 percent of the carrier’s total
relentlessly exploited. This helps to take complexity out of the net revenue and just 26 percent of the total
More than 350 bus stations in the organization in training, staffing and price. “To reduce pressure on fares, it is very
country sell VivaAerobus tickets, thus giving everything else. Complexity is a silent killer important to have different revenue streams,”
passengers the convenience of traveling to in organisations.” said the CEO. “That takes a lot of pressure off
other cities, partly by air and by bus. With you and stimulates demand.”
the Mexican aviation, domestic market Lean and Mean The carrier’s average fare in 2016 was
just a fraction of the number of people who The airline has 42 full time employees US$56. The airline collected and additional
travel by bus, this arrangement has helped per aircraft, the lowest among carriers in US$20 as ancillary revenue. The total price
the airline woo a number of first time flyers. Mexico. Similarly, there are more seats on a that passengers paid on average was US$74.
“IAMSA moves 250 million passengers VivaAerobus aircraft compared to others in The airline’s profit per passenger was US$5.
between cities in Mexico every year,” said the country. “We are very lean,” said Zuazua.
Zuazua. “It is a huge benefit for us to work “Our closest competitors has 60 employees Earning as They Fly
with them. This allows us to reach about 100 per aircraft. The biggest carrier in Mexico VivaAerobus pilots and flight attendants
important cities in Mexico that do not have has about 100 employees per aircraft. We must be hoping it is busy all year; their
an airport. We are connecting a lot of point to operate with 182 seats, while other carriers salaries fluctuate depending on how much
point markets that have never been served have 174 and 150. We also do six sectors per they fly. “We only pay them when they fly;
before. Twelve percent of our total sales are day per aircraft, much more than any other the fixed part of their salaries is 50 percent,”
done through the bus stations.” carrier. This allows us to produce more said Zuazua. “Every single day, our pilots
seats. The more sectors and seats you can start and end their day in their home base
Fleet Renewal Brings Results produce, the lower the costs you have on with their families; we are the only airline in
As part of its attempts to reduce spending every search; that is an assumption that Mexico to do that. This helps us to have a very
on fuel, VivaAerobus in 2013 decided to every low-cost carrier should start with.” sustainable pilot base.”
spend money on 40 A320 NEOs and 12 A320 In a departure from practice in Mexico, The carrier currently has two U.S. routes
CEOs. The move has yielded results, with the carrier has outsourced airport operations. and Zuazua says he is not in any rush to add
the use of the A320 CEOs already resulting “This is not very common in the Americas but more. “International flying comes with a
in a 15 percent savings on fuel. “Having the it is common in Europe,” said Zuazua. “We lot of complexity. Flying to the U.S. reduces
right engine is very important,” said Zuazua. are the first airline in the country to full aircraft utilisation. You will never get a
“We have 40 A320 NEOs in the pipeline. We outsource all airport operations.” 25-minute turnaround in any U.S. airport.”
22 ASIAN AIRLINES & AEROSPACE APRIL / MAY 2017 WWW.GBP.COM.SG/AAA