| VIEW FROM THE TOP
MEXICO’S FLAGSHIP CARRIER CHAMPIONS ECONOMIC DEVELOPMENT ANDRÉS CONESA Director General of Aeroméxico
20
Q: How has the airline industry evolved since you took
Q: What areas of passenger experience are the top
the reins of Mexico’s flagship airline?
priorities for Aeroméxico?
A: The entire aviation industry, including Aeroméxico, was
A: When asked about customer experience, people
destroying capital back in 2005 because airlines did not
think about the Boeing 787 Dreamliner and onboard
focus on additional or long-term capital investments.
experience. However, the worst thing that can happen to
The industry has since become an attractive sector for
a passenger is a flight cancellation. We are refocusing our
investment. Looking at variables such as the size of the
efforts to deliver the most reliable service. For example,
industry, the average age of the fleet and the strength
in October 2017, we set a record for the industry and our
of human capital, it is evident that the industry is much
airline with only three flight cancellations, which was a
stronger now than 13 years ago. For us, Delta Air Lines’
great achievement since we operate between 650 and
investment in Aeroméxico highlights the evolution the
700 daily flights.
industry has undergone since then. Q: How sensitive are Aeroméxico’s operations to natural Q: What are the main concerns that influence
phenomena and how does that impact passenger
Aeroméxico’s general strategy?
experience?
A: Aeroméxico concentrates on hedging its risk based on
A: A narrow-body usually flies four or five daily trips
the three variables that impact our financial performance
for any airline, so if a plane is delayed for any reason
the most: exchange rates, jet fuel prices and real
throughout the day (including weather delays), the
economic activity. Our sources of foreign revenue are
remaining operations involving that plane will most likely
similar to our foreign expenses, which eliminates the need
be delayed. Passengers may see clear skies at night and
to go to financial markets and bet against exchange rates.
think they are being deceived by the airline when told
Regarding fuel, we rely on the oil derivatives market,
that fog or a similar phenomenon set the flight back. But
hedging half of our jet fuel consumption.
if an aircraft is delayed for three hours in the morning, this delay will have a domino effect for the rest of the day.
The worst mistake in this industry is overcapacity, which is why we have staggered leasing contracts to adjust for
Q: How is the growing competition pushing Aeroméxico
contingencies. We own between 35 and 40 percent of
to reinvent itself?
our aircraft and lease the rest. If something goes wrong,
A: Aviation is one of the most competitive industries
we downsize by not renewing aircraft leasing contracts.
and Mexico’s airline market is largely divided in three
On the other hand, if things go well, we just agree to
similar parts. Aeroméxico also competes with some of the
new leases.
best airlines in the international market, including British Airways, Lufthansa, Iberia, Air France-KLM, American
Q: What is Aeroméxico’s strategy to improve passenger
Airlines, Avianca, United Airlines, Japan Airlines and ANA.
experience?
Having strong competitors in and out of Mexico is what
A: Our goal is to offer the best experience every time,
drives Aeroméxico to reinvent itself.
which is key long-term sustainability. The bulk of our expenses is oriented to buying new aircraft along with
Q: What challenges does a saturated AICM pose to
technological investments, which are divided among all
Aeroméxico and how does the airline address them?
of Aeroméxico’s projects to empower our passengers.
A: The main problem at AICM is not the airport
Our digital ecosystem, including our webpage, app and
terminals but the available number of slots. More than
airport kiosks, is designed to provide all our customers
20 companies are flying through AICM, which suggests
with greater control of their travel experience.
that lack of space is not the problem. Aeroméxico can
