Panama Jack
13th Mar 2005, 00:21
Houston Cronicle (http://www.chron.com/cs/CDA/ssistory.mpl/business/3081164)
March 12, 2005, 12:17AM
Alliance helps Continental succeed in Latin America
By BILL HENSEL JR.
Copyright 2005 Houston Chronicle
RESOURCES
EXPANDING IN THE AMERICAS
Copa Airlines
• Hub: Panama City's Tocumen International Airport
• Year started: 1947
• Countries served: 20
• Destinations: 31
• Nonstop U.S. destinations: Miami, Orlando and Los Angeles
• Ownership: Continental Airlines owns 49% of Copa's parent holding company
• Fleet: 18 Boeing 737-700, 3 Boeing 737-800
Continental Airlines' Latin America/Caribbean operations
• Countries served: 24
• Destinations: 64
• Mexican destinations: 29
• Coming next week: Service to Querétaro, Mexico
Sources: Copa Airlines, Continental Airlines
Continental Airlines is continuing a strategic march into Latin America, but launching flights into the region isn't the only way to go.
Consider the latest step by Copa Airlines, the Panamanian affiliate of Continental: Copa earlier this week bought a majority stake in AeroRepublica, Colombia's second-largest air carrier.
Houston-based Continental owns 49 percent of Copa and has an alliance with the airline, so it expects to reap rewards from the AeroRepublica deal through access to more markets and passengers.
Continental's alliance with Copa lets the two airlines feed passengers to each other. And now, some AeroRepublica passengers could wind up on Continental planes. Neither Copa nor AeroRepublica fly into Houston, but some of the airlines' passengers could end up here on Continental flights.
Although Continental has expanded its presence in Mexico and Latin America in recent years by adding more of its own flights, the 1998 decision to buy a big slice of Copa also opened up opportunities.
So far, Continental is the only big carrier to succeed with such an arrangement, experts said.
"Continental's deal with Copa has worked extremely well," Bobby Booth, editor and publisher of AvNews Latin America & Caribbean, said of Continental's ownership venture with the smaller carrier. He noted it's the only such one in the region.
"Tourism is taking off, so it is the right moment for Copa/Continental to become a dominant player in the region," Booth said.
Fort Worth-based American Airlines, which has the biggest presence among U.S. carriers in Latin America, at one point made an investment in Aerolineas Argentinas, but it didn't work out. Other major airlines also tried similar ventures in the region, with essentially the same results.
Understanding the scene
Continental, on the other hand, largely has prevailed. It leaves Copa's day-to-day management to that airline's executives but still helps out in areas such as technology, purchasing, insurance and planning, Booth said.
"The airline maintains its Panamanian identity and culture," Booth said. "Very smart by Continental, as other efforts have failed because of a lack of understanding of the local scene."
Its growth in the Latin American market is helping Continental.
"The returns we get from our Latin operations help offset some of the losses we are experiencing in our domestic system," Continental spokesman Dave Messing said. "Having access to Copa's passengers and network improves our ability to serve the region and its travelers."
Copa's fleet even resembles Continental's, with the traditional blue and gold colors and similar markings adorning its planes. On its Web site, Copa calls its strategic alliance with Continental "one of the most important in Latin American aviation."
Post-purchase plans
Copa plans to operate Aero-Republica as a separate carrier. Copa executives called it an alliance that represents a "global trend" that benefits passengers and airlines.
"We believe we have an opportunity to strengthen the airline to make it a leading company in Colombian commercial aviation," Pedro Heilbron, CEO of Copa, said of AeroRepublica in a written statement.
The terms of Copa's deal for AeroRepublica weren't disclosed.
Even though the deal was Copa's, Continental is expected to benefit.
Latin American air travel has heated up in recent years, with Booth noting a variety of airlines are doing well.
AeroRepublica may wind up becoming the low-cost carrier affiliate for Copa/Continental in the region, Booth said.
Discovering the region
After struggling for some years, low-cost carriers are beginning to take hold in Latin America. Competition is rising as U.S. discounters JetBlue and Spirit have discovered Central America and the Caribbean, he noted.
Copa began service in 1947 and now flies to 31 destinations in 20 countries in North, Central and South America and the Caribbean Panama. Copa passengers can fly on other carriers to reach additional destinations through its alliances with Continental and Mexicana.
Continental, meanwhile, continues to grow its own Latin America service.
It begins daily, nonstop service to Querétaro, Mexico, next week, its 30th Mexican destination.
Continental has more flights to Mexico than any other U.S. carrier.
[email protected]
March 12, 2005, 12:17AM
Alliance helps Continental succeed in Latin America
By BILL HENSEL JR.
Copyright 2005 Houston Chronicle
RESOURCES
EXPANDING IN THE AMERICAS
Copa Airlines
• Hub: Panama City's Tocumen International Airport
• Year started: 1947
• Countries served: 20
• Destinations: 31
• Nonstop U.S. destinations: Miami, Orlando and Los Angeles
• Ownership: Continental Airlines owns 49% of Copa's parent holding company
• Fleet: 18 Boeing 737-700, 3 Boeing 737-800
Continental Airlines' Latin America/Caribbean operations
• Countries served: 24
• Destinations: 64
• Mexican destinations: 29
• Coming next week: Service to Querétaro, Mexico
Sources: Copa Airlines, Continental Airlines
Continental Airlines is continuing a strategic march into Latin America, but launching flights into the region isn't the only way to go.
Consider the latest step by Copa Airlines, the Panamanian affiliate of Continental: Copa earlier this week bought a majority stake in AeroRepublica, Colombia's second-largest air carrier.
Houston-based Continental owns 49 percent of Copa and has an alliance with the airline, so it expects to reap rewards from the AeroRepublica deal through access to more markets and passengers.
Continental's alliance with Copa lets the two airlines feed passengers to each other. And now, some AeroRepublica passengers could wind up on Continental planes. Neither Copa nor AeroRepublica fly into Houston, but some of the airlines' passengers could end up here on Continental flights.
Although Continental has expanded its presence in Mexico and Latin America in recent years by adding more of its own flights, the 1998 decision to buy a big slice of Copa also opened up opportunities.
So far, Continental is the only big carrier to succeed with such an arrangement, experts said.
"Continental's deal with Copa has worked extremely well," Bobby Booth, editor and publisher of AvNews Latin America & Caribbean, said of Continental's ownership venture with the smaller carrier. He noted it's the only such one in the region.
"Tourism is taking off, so it is the right moment for Copa/Continental to become a dominant player in the region," Booth said.
Fort Worth-based American Airlines, which has the biggest presence among U.S. carriers in Latin America, at one point made an investment in Aerolineas Argentinas, but it didn't work out. Other major airlines also tried similar ventures in the region, with essentially the same results.
Understanding the scene
Continental, on the other hand, largely has prevailed. It leaves Copa's day-to-day management to that airline's executives but still helps out in areas such as technology, purchasing, insurance and planning, Booth said.
"The airline maintains its Panamanian identity and culture," Booth said. "Very smart by Continental, as other efforts have failed because of a lack of understanding of the local scene."
Its growth in the Latin American market is helping Continental.
"The returns we get from our Latin operations help offset some of the losses we are experiencing in our domestic system," Continental spokesman Dave Messing said. "Having access to Copa's passengers and network improves our ability to serve the region and its travelers."
Copa's fleet even resembles Continental's, with the traditional blue and gold colors and similar markings adorning its planes. On its Web site, Copa calls its strategic alliance with Continental "one of the most important in Latin American aviation."
Post-purchase plans
Copa plans to operate Aero-Republica as a separate carrier. Copa executives called it an alliance that represents a "global trend" that benefits passengers and airlines.
"We believe we have an opportunity to strengthen the airline to make it a leading company in Colombian commercial aviation," Pedro Heilbron, CEO of Copa, said of AeroRepublica in a written statement.
The terms of Copa's deal for AeroRepublica weren't disclosed.
Even though the deal was Copa's, Continental is expected to benefit.
Latin American air travel has heated up in recent years, with Booth noting a variety of airlines are doing well.
AeroRepublica may wind up becoming the low-cost carrier affiliate for Copa/Continental in the region, Booth said.
Discovering the region
After struggling for some years, low-cost carriers are beginning to take hold in Latin America. Competition is rising as U.S. discounters JetBlue and Spirit have discovered Central America and the Caribbean, he noted.
Copa began service in 1947 and now flies to 31 destinations in 20 countries in North, Central and South America and the Caribbean Panama. Copa passengers can fly on other carriers to reach additional destinations through its alliances with Continental and Mexicana.
Continental, meanwhile, continues to grow its own Latin America service.
It begins daily, nonstop service to Querétaro, Mexico, next week, its 30th Mexican destination.
Continental has more flights to Mexico than any other U.S. carrier.
[email protected]