Tempe, Ariza. – Six months after restructuring and bankruptcy in a stronger financial position, Latin American airline Avianca announced this week that it plans to add up to four aircraft to its cargo fleet as part of a broad growth strategy.

The Colombian company Avianca announced on Monday that it will lease two Airbus A330-300 passenger planes, converted to transport containers on the main deck, at CDB Aviation. Officials said they were negotiating the purchase of two more cargo ships in the Irish subsidiary of the China Development Bank. The first refitted cargo ship is expected to be operational by the end of the year.

The pandemic and bankruptcy process has crystallized for executives the importance of the freight business, Aivanca Cargo chief operating officer Juan Correa told FreightWaves on the sidelines of the Cargo Network Services conference.

“Carriage of cargo in passenger planes is a competitive advantage because you fly cargo in the abdominal compartment. This raises financial performance and revenue. And then you can compete with low-cost carriers, you can maintain routes longer or develop new markets because you have at least half the lower decks full of revenue with cargo.

Bankruptcy has allowed Avianca to reduce its debt and merge with liquidity of $ 1 billion.

“So the company understood that,” Correa said. “They already had trucks. Thus, the freight business has become one of the three post-bankruptcy priorities for business development, along with an inexpensive model and a program of frequent pilots. ”

In February, CDB Aviation placed an order for 12 conversions of the A330 from passenger to freight to engineering and overhaul specialist Elbe Flugzeugwerke GmbH, a joint venture of Airbus and Singaporean ST Engineering. Traditionally the lessor of passenger aircraft, CDB last month got its first A330 reconfigured EFW with pre-order for two aircraft. The two planes are being leased to Mas from Mexico.

Avianca currently operates six factory cargo ships A330-200. The cargo fleet will increase by two-thirds by 2024, when all orders for medium-body wide-body aircraft will be placed. Avianca also has access to facilities from Mexican haulier Aerounión, which leases its five cargo ships to Avianca, as well as through its passenger fleet of more than 100 aircraft.

The Avianca Cargo network focuses primarily on the United States, including the center in Miami, as well as Central and South America. It also serves three destinations in Europe. Last year it transported more than 770,000 tons of cargo.

The cargo airline said it had transported 14,200 tons of flowers before Valentine’s Day in February, up 6% from 2021. Other staple goods it transports from South America include fresh seafood and fruit. In March Avianca has signed a contract with Jettainer for the provision, maintenance and fleet management of cargo unit units.

The air cargo was a lifesaver for people and airlines around the world, delivering medical supplies and record revenue when the pandemic destroyed passenger travel, Correa said.

“There was an understanding that we need to continue with this, to bring it to the first level. We need to develop business, ”he said in the break between the meetings. “This is the development of a new strategy and the transfer of the freight business to the top priority.”

Latin American Market

Latin American carriers reported that cargo volumes in March increased by 22% compared to 2021, which was the highest among all regions, according to the International Air Transport Association. As major airlines emerge from bankruptcy, they may increasingly exhibit a larger fleet, increasing market capacity.

20-year-old Boeing fFr.recycle cargo volumes between Latin America and North America will grow by 2.6% annually by 2039, below the growth rate of global air traffic by 4%. Air trade between Latin America will increase by 3.1% per year. Predictions were made in mid-2020 before it was clear the full impact of COVID on supply chain disruptions and additional purchases in e-commerce.

Freight is increasingly attracting investors due to strong growth trends in general cargo and e-commerce, while passenger networks are becoming less reliable for shippers.

LATAM Group, which competes in the same market as Avianca, said on Tuesday it had received its third refitted Boeing 767 cargo plane and expects another delivery in September. The airline is sending Boeing 10 used aircraft from its passenger fleet (NYSE: BA) for reconfiguration into regular cargo aircraft.

The latest cargo ship will be mainly used to transport flowers from Colombia and Ecuador and expand to more U.S. and European destinations, LATAM said.

Earlier this month, Avianca and Brazilian airline Gol agreed to join forces within a holding company called Abra Group, which is controlled by the company’s major shareholders. The move, which is expected to close in the second half, creates a third major group of airlines with scale and bundles to compete for passengers. Both airlines will continue to operate as independent brands.

Click here for more FreightWaves / American Shipper stories by Eric Kulish.

Related news:

Sichuan Airlines to receive first converted A330 cargo aircraft built in China

LATAM blocks in terms of expanding with The Boeing 767 has been converted to cargo

https://www.freightwaves.com/news/avianca-uses-bankruptcy-exit-to-fuel-cargo-busines

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