March 14, 2014 / 4:08 AM / in 5 years

Colombian airline Avianca reduces flights to Venezuela

BOGOTA, March 13 (Reuters) - Avianca Holdings SA, operator of Colombia’s biggest airline, has become the latest carrier to cut flights to Venezuela amid a furor over Venezuelan currency controls that airlines say have locked up revenue of $3.7 billion.

Colombia’s flagship airline has cut flights between the countries’ capitals and suspended regional routes following similar action by peers such as American Airlines Group Inc , Copa Holdings SA’s Copa Airlines and Grupo Aeromexico SAB de CV.

The International Air Transport Association has said more airlines could follow suit as they struggle to get bolivar-denominated ticket sales converted into U.S. dollars at a profitable exchange rate.

Venezuela announced another exchange rate on March 11. The so-called Sicad 2 platform adds a third rate to the country’s 11-year-old currency controls, fixing $1 at 6.3 bolivars for preferential goods and around 11 bolivars for other items.

Avianca Chief Executive Fabio Villegas said recently that currency controls had made it difficult to bring ticket revenue worth about $300 million out of Venezuela.

He said Avianca was seeking ways that would allow any transaction to go ahead and was confident Venezuela would respect the official exchange rate of 6.3 bolivars.

On Thursday, Avianca said in a letter to travel agents seen by Reuters that it will cut the number of routes and daily flights to Venezuela “to match supply to market needs”.

The airline said it will fly between the capitals of Bogota and Caracas once a day instead of three times effective March 20.

Avianca will suspend flights between Bogota and Valencia from May 7, and Costa Rica’s San Jose and Caracas from April 7. The airline will also reduce the number of seats available between Peru’s Lima and Caracas from March 16.

Avianca, controlled by Brazilian entrepreneur German Efromovich, and Taca, owned by El Salvador’s Kriete family, form a conglomerate operating more than 150 planes flying to more than 100 destinations in 25 countries, and employing 18,500 people. (Reporting by Luis Jaime Acosta; Writing by Helen Murphy; Editing by Christopher Cushing)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below