Mexicana Bid Rejected, Public Wins

By David Simmonds

Air flights within Mexico have become much cheaper the past few years as start-up airlines have increased competition to the long-time carrier giants, Mexicana and AeroMexico. Utilizing the power of online booking and well-designed web sites, newer airlines such as Alma, Aviacsa, Avolar and Volaris have opened up new routes at competitive prices, fueling the decline in revenues for the Big Two.

Mexicana had recently made a bid to buy AeroMexico, which would have given them control of over 50% of the domestic market. Wisely, the anti-monopoly regulators in Mexico have ruled against the sale, citing too much “market control” as the reason for the correct decision.

Prior to competition being allowed in the domestic market, the price to fly from city-to-city was insane, with fares much greater mile-to-mile than in the U.S. I recently flew on Avolar round-trip from Tijuana to Tepic, about 2,000 miles total, for less than $175.00. So, props to the Mexican regulators for watching out for the public and not succumbing to the “elite-connected” network pressures that so often dictate the agenda.