Given his recurring questions about whaté notó with Equair which was suspendedó operations abruptly, We review the causes that could have influenced this situation.ón.
Write these líneas is not fácil, since the feeling of sorrow is compared to what was experiencedñthe atreás when we lost the úlast airínea that by decree was «Ecuadorian flag» Tame EP. think that Equair no longer plowá the skies of our countryís aúIt's hard to assimilate and it's so sad to see how friends and great collaborators have abruptly lost their jobs..
We not only lose one airínea, jobs, but alsoén an alternative más, where healthy competition betweeníneas aéAreas always benefit the user.
¿Becauseé cerró Equair?
The 30 September 2023 the airíalready steeply shapedó to operate, ¿thaté notó?
This has been the doubt of many of you, of communication mediaón they have written to me and the answer is impossible to know for sure, since the decisions of the investors and what happens inside the house cannot be known, but there are many other factors that sí we can analyze and even, what happened months agoás in the Colombian market leaves us with many lessonsñfaiths that are worth reviewing to our reality:
- Internal risks: These risks are caused by factors within the airline.ínea, how I managed itón, operations and finances.
- External risks: These risks are caused by factors beyond the control of the airline.ínea, like the economyía, the Políethics and the price of fuel.
Internal risks include:
- Market study: a wrong approach to identificationón of the strata marketélogic of an airplaneínea can lead it to not be sustainable over time. From the hand comes the right oneáanalysis of routes and frequencies to operate that allow covering general production costsón.
- Competition: The aerosolsíBusinesses that cannot compete with strategies of low prices and differentiated value in attractive services run the risk of losing customers and, eventually impacts your financial sustainability.
- High operating costs: through the industry it will be possibleíto consider high, which include fuel, Aircraft Maintenance, aircraft rental, airplane insurance, employee salaries, airport taxes. If these costs exceed the revenue generated by the airlineínea, can destabilize its continuity.
- Financial problems: The aerosolsícompanies may face financial difficulties due to internal factors, such as managing accounts with suppliers or expanding the company with new projects that require greater investment.ón high risk with undesirable consequences.
External risks include:
- Fuel price increase: The aerosolsílines depend on fuels fósiles like petróleo to operate your flights. When oil pricesóleo increase, airline operating costsínot too oldén increase. If you spray themícompanies cannot increase their rates enough to cover the increase in costs, can experience péfinancial losses.
- Problemas macroeconómonkeys: The aerosolsínot too oldén can be affected by economic problemsómonkeys at national or global level. For instance, during a recessionón económica, travelers can reduce their spending on travel and leisure, which reduces the demand for low-cost flights. The aerosolsínot too oldén can be affected by issues such as changes in exchange rates and increased taxes.
- operational problems: on certain occasions, the aerosolsígirls by choiceón the type of aircraft in your fleet may have growth limitations due to operational limitations on certain runways due to the length and height where they are located. This generates a limited possibility of growth and entry into new markets of high demand..
Usually, the industry toéarea is highly volátil and the aerosolíit is a sinán exposed to many risks, both internal and external. Those who cannot adaptádue to changes in the market or that do not have the capacity to generate sufficient income to cover their costs, they risk suspending their operations.
As we can see, There are many factors that could influence, some more than others, in the specific caseíI'm from Equair, but that have undoubtedly been present to determine the end of another aerosolínea ecuatoriana máonly that it adds up to Ecuadorian, Hour, SAN, Icarus, Air Cuenca, LAC and a few othersás.
¿CuáDo you think they were the main causes?
Dear All
If we make history
Tame 12 aircraft
Saint and Saeta 4 aircraft
Icarus 8 aircraft
aircraft 4 aircraft
We are talking about Ecuador having a good market and competition.…now the problem in my opinion was COMPETING with AVIANCA AND LAN CHILE who have more or less 100 aircraft each.
Therein lies the problem: they entered the national routes and AUTOMATICALLY bankrupted every Ecuadorian company in due time.…nothing more.
You are talking about LATAM Airlines as a group, in Ecuador, LATAM Ecuador has 6 aircraft, no 100. Other error, Tame came to have 17 aircrafts and I do not understand the relationship of "they entered national routes and automatically went bankrupt". All the ones you mention started with domestic flights, I didn't understand.
There is a lot of spam on your page Nicolás. Your content is interesting, but it is annoying to see so much invasive advertising. Moderate it please, One or another announcement is fine but there are too many sir.
Hi Alex, Thanks for your comment, I appreciate what you told me, but this blog is maintained with advertising, If I ever find another source of financing, obviously low number of ads.
It is clear how difficult it is to manage an airline and it is not only difficult in Ecuador but worldwide, large global airlines have gone bankrupt anyway.
The question is how low cost Europe have lower rates for flights of three or more hours in Ecuador 30 minutes and flight costs 5 times safer airports fuel and personnel is more expensive how they achieve it ?
Offer and demand, In Europe, the size of demand is so large in volume that it allows airlines to operate with very low margins per passenger., but it is compensated by the number of frequencies that can operate in an economy of scale. Additional, The difference in rates and taxes there is considerably lower.
Hi Nicolas, I also published my impressions on this topic.
https://www.linkedin.com/pulse/equair-una-iniciativa-que-prosper%25C3%25B3-alexandra-giselle-chavez-o%25C3%25B1a/?published=t
Thank you Alexandra for sharing..
What happened to the Ecuadorian airline airlines??
There is no good or bad news.
Hi Nicolas, I congratulate you, it is an excellent analysis, encompasses practically all the causes of the unfortunate closure of this airline that had a great service.
Mainly I believe and personally I saw this coming from the beginning, competing with airlines like Avianca and Latam, sooner or later, if there is no strong financial hug, it will lead you to the closure of operations.
Greetings.
Thanks for your contribution Freddy, a pleasure to greet.
Because it does not include a lack of support from the DAC, which has always been a determining factor in the closure of Ecuadorian companies since it has always tended to favor foreign flag sales companies, which are allowed to lease foreign-registered aircraft. attractive routes but not other cities that do not operate
I don't understand your point of view about the DGAC. You mention foreign registration, the same thing Equair could have done if it wanted to.. What does leasing have to do with it?? Desirable routes, airlines fly where there is a market, just as Equair did flying the "desirable" ones you call. Explain your point further, which is not understood at the moment..