Avianca, LATAM Partially Ground Fleets As Pandemic Spreads, Travel Restrictions Take Effect

While Copa (NYSE: CPA) and Viva Airlines have not announced any fleet groundings so far, this week Colombia-based Avianca (NYSE: AVH, BVC: PFAVH) and Chile-based LATAM (NYSE: LTM) have announced significant cutbacks on routes, grounding between 30-40% of their fleets in the face of the Coronavirus COVID-19 Pandemic.

Beginning last Saturday, Avianca is reducing its operations by 30-40%, reorganizing some of its routes to and from its home base of Bogotá, Colombia, the airline said in a written statement shared with Finance Colombia.

“90% of our operations are domestic and as of now, have remained stable, so we haven’t seen our traffic affected— a Viva Air Spokesperson

LATAM announced a reduction in international flights of approximately 30%, and said the measure will apply primarily to flights between South America and destinations in Europe and the United States between April first and May 30.

LATAM said that it has not seen domestic demand affected and will not for the time being, modify domestic itineraries. The money-losing Chilean carrier also announced suspension of new investments, expenses and hiring, and will offer incentives to employees to use accrued vacation and take unpaid leave.

“Faced with this complex and extraordinarily dynamic scenario, LATAM is taking immediate and responsible measures to safeguard the group’s long-term sustainability, while seeking to secure passengers’ travel plans and protect the jobs of the group’s 43,000 coworkers. At the same time, we will maintain the flexibility to take additional measures, if necessary, due to the speed at which events are unfolding,” said Roberto Alvo, chief commercial officer and CEO-elect of LATAM Airlines Group. Alvo added that, given the current context, the company has decided to suspend its guidance for 2020.

“As the medium term effect is uncertain, in the short term we have evidenced a marked fall in trip demand. In that sense, first we have attempted to give more flexibility to our customers so they can purchase with more tranquility, and make changes in their travel plans. Second, we will temporarily reduce between 30-40% our capacity. Third, we have reinforced our safety and hygiene protocols to protect the well-being of passengers, flight and ground crew,” said Silvia Mosquera, Avianca’s Chief Commercial Officer.

A Copa representative declined comment saying that at the time they had no additional information to give on operations. All four airlines contacted for this article reiterated their HEPA air filtration systems that recirculate cabin air “every 3 minutes” and that they are taking additional cleaning and disinfection procedures.