Army’s New Commercial Airline, Mexican aviationthe main concern is not to become a tax burden for Mexico while fueling fear of the military intervening in civilian markets, experts agreed this Thursday.
President Andrés Manuel López Obrador announced a week ago Mexican government agreement to pay 815 million pesos buy the Mexicana de Aviación brand, which was the country’s main airline until it went out of business in August 2010.
The constitution of the Mexican State Airlines had already been established by decree of May 18, when the Minister of National Defense (Sedena) authorized the company will offer commercial and cargo flights Inside and outside the country.
According to López Obrador’s plans, this state-owned airline will enter the market with prices up to 20% cheaper than competitors and is estimated to reach profitability in 2025.
But the biggest challenge, as explained by Fernando Gomez, an economic analyst specializing in the aviation sector, will be to ensure the viability of the state-owned company and no need to live off the state budget.
Carlos Torres, also an expert in the field, agreed and noted that will put additional pressure on public finances at a time when capital injections could have a greater impact on areas such as healthcare or education.
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Gómez believed that while López Obrador claimed he was not looking for profit, a business model with a high vision for profitability was needed.
Defense Minister Luis Crecencio Sandoval said he will start flying this year with 10 Boeing 737-800s for serve the 20 most competitive destinations in the countrywith an initial investment of 4,000 million pesos.
According to Fernando Gomez, the new state-owned airline you will have to add another equal amount over the next two years for working capital, salaries, maintenance, operating expenses, services and infrastructure, among others.
Torres doubted that the army would operate aircraft next December as López Obrador had envisioned, and that it would be fully profitable by 2025.
“I don’t think that any business, even from another direction, can have such a quick profitability,” he said.
He pointed out that the aircraft must be tested and certified, which could interfere with the achievement of the goal.
Unfair competition?
Torres warned about possible conflict of powersince the management of some airports has recently been transferred to the Armed Forces, which may mean unfair advantages over the country’s private airlines: Aeroméxico, Volaris and VivaAerobus.
He also mentioned that the new player raid competition is always good and dispelled that the state can create an imbalance in the market even with the announced discounts.
On the other hand, he believed that the market would be open more. if Mexico reinstates Category 1 aviation security which the United States lowered in 2021 as private airlines can focus their efforts on flying to international destinations, primarily to North America.
Necessary transparency
In addition, Roberto Duran, specialist at Tecnológico de Monterrey, believes that transparent resource management is essential.
“I don’t know if this is the best public resourceconsidering the needs that we have, but I would like not to worry about the financial black hole,” he commented.
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Duran stressed that all decisions must be justified because it is “a public company with public resources.”
“We have to hope that all this becomes public because all of us (Mexicans) are shareholders,” he said.
The expert also noted that the discussion reopens discussion on growing military involvement in the public and commercial sectors such as airport administration, customs, and the construction of facilities such as the Mayan train.
Although he acknowledged the reasons why Required state rector in the sector, he asked to analyze whether the service should be directly provided.
In this sense, he argued that the answer was not to give more power to the military, but to bring the bureaucracy to the same level. discipline, professionalism and efficiency. (EFE)
Source: Aristegui Noticias
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
