Skift Take
With good management, this ultra low-cost airline strategy is profitable just about everywhere. The key? Airlines like Viva Aerobus must be fanatical about costs, and they must provide the cheapest fares, all the time. They also should treat their customers fairly.
If he could, Viva Aerobus CEO Juan Carlos Zuazua might install half-standing, half-sitting seats on his airline’s Airbus A320s. Several manufacturers have shopped them over the past decade, saying there's no reason passengers must be fully seated for short flights.
Not many airline executives admit they want to cram so many passengers on each plane. But Zuazua, CEO of Mexico’s only true ultra low-cost carrier, said most of his customers — every day about 22 percent fly for the first time — want only the cheapest prices. Comfort, he said, is less of a concern.
"My average stage length is an hour and 30 minutes so perhaps that's something that passengers may be able to take if the price was right," Zuazua said in a recent interview.
If Zuazua sounds like Michael O'Leary, the savvy yet loose-lipped CEO of Europe's Ryanair, it's for good reason. For a decade, ending late last year, an investment firm controlled by Declan Ryan, a member of the family that founded Ryanair, owned nearly half of Viva Aerobus.
Ryan's company, called Irelandia Aviation, provides funding and advice to low cost airlines, especially in Latin America, helping them follow Ryanair's no-frills model. Viva Aerobus is now fully owned by Grupo IAMSA, a Mexican bus company, which knows many of its customers want to trade-up to air travel. It would prefer to control the airline its customers fly.
But like Ryanair's O'Leary, who has mused about half-standing seats but never adopted them, Zuazua said he knows the unusual configuration is probably not viable. While there's likely no technical reason seats would not fit, airlines and manufacturers might struggle to certify them, since they would have to persuade safety regulators all those extra passengers could evacuate in an emergency.
"The reality is, it's going to be very hard to put on more passengers," Zuazua said.
Instead, Viva Aerobus is focused on the usual discount airline strategy — cutting costs while charging extra for nearly everything it can. Passengers may not like that some seats have as little as 28 inches of pitch, or roughly the same as Spirit Airlines in the United States. But when the alternative is a 12-hour bus ride, many prefer air travel.
Viva Aerobus is not the only Mexican airline offering alternatives to buses. Its biggest competitor is Volaris, a discounter with 68 aircraft, making it roughly three times the size of Viva Aerobus. But Volaris is slightly more full-service than Vi
