Mexico’s Volaris Sticks With Its U.S. Focus Despite Recent Stumbles

Volaris, the Mexican ultra-low-cost airline that once thrilled investors with a model that focused on persuading passengers to switch from buses to planes, has no plans to change its core strategy, even though its stock has lost more than 60 percent of its value during the past two years. The market, "keeps on growing," CEO Enrique Beltranena said in an interview. "In general, traffic in domestic and international is growing at a faster pace than GDP." That's true, but recent changes in the Mexican market are having an effect on Volaris, which introduced its Ryanair-style model to the country in 2006. The airline has struggled because of several factors, including currency exchange pressure, higher fuel prices, and deceased demand for its U.S.-Mexico flights, blamed in part on geopolitical factors. It has tried to cope by focusing on ancillary fees, but there's one problem — the Mexican government does not permit airlines to charge for checked bags on domestic flights. Volar