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VivaAerobus announces purchase

Published Thursday, November 21, 2013

 

  • VivaAerobus Group (“VivaAerobus”) signs landmark purchase agreement for 40 A320neo and 12 A320ceo.

  • VivaAerobus makes history by securing the biggest ever Airbus aircraft purchase agreement by a single Latin American airline.

México, Distrito Federal, October 21, 2013.- VivaAerobus, Mexico’s ultra low cost carrier, announces its purchase agreement for 52 A320 Family aircraft from leading aircraft manufacturer Airbus. The deal, worth $5.1 billion USD at current list prices, will allow VivaAerobus to grow and replace its existing fleet and become an all-Airbus operator by the end of 2016.

“With the objective of further reducing our costs, improving our reliability, punctuality and the overall passenger experience we have evaluated the latest aircraft technology and today VivaAerobus Group is delighted to announce its purchase agreement for 40 A320neo (New Engine Option) and 12 A320ceo (Current Engine Option) of the A320 Family of Airbus, with the option of 40 additional A320neo”, says Juan Carlos Zuazua, CEO.

“This is an important milestone for passengers, shareholders and staff at VivaAerobus which we all feel very proud of. This decision will support our growth strategy, as it will enable us to lower costs and airfares even further, thereby widening VivaAerobus´ price leadership over all airlines in Mexico. These aircraft provide Viva with additional capacity to exploit substantial growth opportunities in Mexico, while growing in our main hubs such as Monterrey, Guadalajara, Cancun, as well as in five potential hubs we are evaluating”, he adds.

“We are absolutely making aviation history in Mexico and in the travel industry. Not only is VivaAerobus today the only real low cost airline in the country but it is also the first in Latin America to have such a huge purchase agreement with Airbus, an undeniable leader in aircraft manufacturing. This is an unprecedented announcement which enhances VivaAerobus’ competitiveness and will speed its growth by lowering costs fares, focusing on serving Mexico’s underpenetrated markets and converting more bus-to-air passengers.”

With 52 aircraft VivaAerobus expects to grow traffic to over 16.8 million passengers a year and to produce an economic spill in the travel industry of over $47 billion pesos (current prices). It will also employ more than 4,200 people directly and indirectly.

The A320neo is one of the latest innovations in Airbus products, which is still the most advanced, eco-friendly and fuel-efficient among single-aisle jetliners.

“Thanks to its new engine technology and “Sharklets”, the A320neo achieves a 15% fuel consumption reduction as compared to its current technology, the A320ceo, and offers at least 30% fuel saving versus our current model, the 737-300”, Zuazua says.

The A320 Family has the lowest operating costs and best fuel efficiency in the market. It offers the most comfortable cabin thanks to having the widest single-aisle fuselage in its class, allowing for unmatched passenger comfort and the fastest turnaround times. Its superior cabin size and shape result in larger overhead stowage compartments, which contribute to faster boarding and deplaning - - a must for a low cost carrier.

The airline will start transitioning to the A320 in 2014, and expects to replace its entire fleet of 19 737-300 to become an all-Airbus carrier by the end of 2016.

“We have not yet concluded our engine selection, which is a key component on securing our lowest cost and improved reliability. As a true low cost carrier, we will negotiate with all the different aircraft component suppliers that would enable us to further reduce our costs. We will also engage with the financing community as it will be an important project ahead.” Zuazua says.

“VivaAerobus has been a pioneer in Mexico of the “Bus to Air” model, with a proven strategy of converting bus to air travelers. We are confident that the capacity we are adding with these 52 A320 aircraft will allow us to continue growing the Mexican domestic market and expand beyond our borders”, concludes Zuazua.

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Based in Monterrey, N.L., VivaAerobus is Mexico’s Ultra Low Cost Carrier. It started operations on November 2006 after being created as a joint venture between IAMSA and Irelandia. It operates a fleet of 19 Boeing 737-300 aircraft on 50 domestic routes and 1 to the United States.

IAMSA is Mexico’s leading company on ground transportation services. It operates a fleet of over 10 thousand buses in 22 states of the country and transports over 300 million people a year, reaching over 70% of the population.

Irelandia, is the investment vehicle of the Ryan family, founders of Ryanair, the biggest and most successful low cost airline in Europe. Irelandia is the leader in the development of low cost carriers around the world. It has also invested in companies such as Allegiant Air in the United States, Tiger Airways in Singapore and recently spreading the Viva brand in Latin America with VivaColombia in Colombia.


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