The return of Viva Air and Ultra Air is less certain than what the Minister of Transport says

"Viva and Ultra are in no condition to operate ever again."

This is how resounding the transport expert Manuel Guillermo Sarmiento is, regarding the period of tense calm in the Colombian air market after the bankruptcy of two low-cost airlines in just one month.

But the Minister of Transportation, Guillermo Reyes, has been optimistic: on Monday he announced that both will resume their flights at the end of April.

The words of the head of the portfolio assume that the Civil Aeronautics will reject the appeal presented by the Chilean Latam to stop the already approved business merger between Avianca and Viva Air, which would clear the horizon for their flights.

More nebulous is the situation of Ultra, which, after only one year of life, announced its unilateral cessation of operations on March 30, leaving multiple questions about the future and viability of the business of low-cost companies in the country.

To put its services back into operation, Ultra has "advanced a lot," according to Minister Reyes, in a capitalization process to overcome a financial hole that reaches 22 million dollars.

Santiago Castro, former director of AeroCivil, shows his disagreement with the minister: “I do not see an aviation policy on the part of the Government.

In the Development Plan there is not even a comma about it and with each passing day there is more risk that pilots will look for work in other companies, that lessors

lessors) will take back the planes.

No airline in the world can remain frozen to see if one day it manages to revive”.

That is why he calls for speed in "a process that should be

".

Ultra was financed by the advance collection of seats from wholesale travel agencies and the pre-sale of tickets, in addition to term credits with suppliers.

It managed to pre-sell 327,551 tickets between March 2023 and February 2024. But the devaluation of the Colombian peso dealt it a particularly hard blow since the increase in the price of fuel and rents, which are paid in dollars, exposed the cracks financial.

The money from pre-sales, according to Forbes magazine, has been transferred to bank accounts in the United States and the chances of repairing users are isolated.

"So many alternatives have been considered in public, there have been so many speculations and statements by the minister," explains the sector expert Claudia Velásquez, "that I think what they have achieved is to generate more concern than peace of mind."

She recalls that Petro Government sources have outlined various measures, from "tariff intervention in the market, to regulating rate floors and focusing all efforts on Satena."

Between Viva Air and Ultra, emphasizes the lawyer Manuel Guillermo Sarmiento, they brought together "more or less 25% of the Colombian market."

And he adds that the situation of the creditors of the two companies should not be minimized: “There are many financial institutions that could suffer significant losses.

Thousands of users are going to be harmed together in a market that moves 60 million passengers a year and that should be corrected as soon as possible to make it truly efficient and competitive”.

For Claudia Velásquez from the Government, they should focus on measures more aimed at allowing the economic operation of airlines, such as reducing VAT on air transport services, hotel services, or fuel.

Facts, says the expert, that allow airlines to have “more rational costs and be able to weather these storms.

I think that the reflection is that the minister's position could be more active, instead of going out and speaking and complaining and saying that he files criminal complaints and that in the background he has very little to do with the real problem, which is passengers with money invested and without the service rendered”.

In his opinion, there is still no agreement on the controversial issue of

, the time slots for the takeoff and landing of aircraft that are a key element in the approval of integration between the centenary Avianca and Viva.

One of the requirements imposed by Aeronautics, in charge of ensuring free competition, to this merger, was to return, every year in high season, which runs from April to October, 33.6 departure slots and 31.1 arrival slots. at the El Dorado airport in Bogota.

Avianca filed an appeal, the content of which is unknown, to reduce those figures.

And it is that Viva, founded in 2009 and with a subsidiary in Peru, was the third company by market share and its absorption for many analysts will translate into a concentration scenario.

That is why the formula proposed by Aerocivil does not finish convincing Sarmiento, who recalls that Avianca already controlled 80% of the time slots at the best times: "The slots are not owned by the airlines, according to the commercial and

code .

They are goods for public use and the concentration of Avianca at peak hours constitutes an entry barrier for any other airline.

That is the bottom of the discussion."

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