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Aeromexico says adios to the Embraer E170 amid plans to remove 19 jets through bankruptcy

Edward Russell
Edward Russell
Contributor
Edward Russell is a contributor for TPG. An AvGeek at heart, he covered the airline business at FlightGlobal for eight years and previously covered finance in New York and Hong Kong.
July 06, 2020
•
5 min read
MEXICO-AIR-AEROMEXICO-PILOTS-STRIKE
Aeromexico says adios to the Embraer E170 amid plans to remove 19 jets through bankruptcy
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Aeromexico is moving forward with its bankruptcy reorganization with plans to shed 19 Boeing and Embraer jets as it outlines plans to shrink due to the coronavirus pandemic.

Among the jets that the Mexico City-based carrier plans to return to lessors are all nine of the Embraer E170s flown by its regional affiliate Aeromexico Connect. This would leave the subsidiary with a fleet of just larger E190s.

In addition, Aeromexico wants to return five of its 11 Boeing 737-700s plus five of its 35 737-800s to their owners, the airline outlined in a court filing on July 3. The airline operates a fleet of 126 jets that also includes 19 Boeing 787s.

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Aeromexico is the largest airline in Mexico and a close partner of Delta Air Lines. Together with Delta, the two carriers carried nearly a quarter of all passengers between Mexico and the U.S. -- the most of any airline -- in 2019, according to U.S. Bureau of Transportation Statistics (BTS) data via Cirium.

Aeromexico and Delta operate under a joint venture between Mexico and the U.S. This allows them to act as essentially a single airline in the market, coordinating schedules and fares, and providing reciprocal amenities for their frequent travelers.

The Mexican carrier considers its Delta partnership "critical" to its business, according to court filings. It plans to maintain all of its agreements, including the joint venture, with the U.S. carrier through the restructuring process.

Related: Aeromexico files for bankruptcy, third Latin American carrier to restructure

Aeromexico continues flying despite its Chapter 11 restructuring. The airline plans to operate about 30% of what it flew a year ago in July, Cirium schedules show. This is up from only about 15% of what it flew a year ago in June.

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In addition, Aeromexico's bankruptcy has had no effect on its Club Premier loyalty program.

The carrier's decision to retire its E170s will have little impact on U.S. travelers. Aeromexico flew the jets almost exclusively on Mexican domestic routes, save the occasional one-off run to a U.S. destination, in 2019, according to Cirium.

Aeromexico is the third major airline in Latin America, after Avianca and LATAM Airlines, to restructure its business through bankruptcy due to the pandemic. The region's carriers have been hit hard by the slowdown in travel while few Latin American governments have offered financial assistance to bridge them through the crisis.

Related: More than half of global airlines could 'die' without aid, says IATA

Featured image by AFP via Getty Images

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