Avianca Cargo is throttling forward

Avianca Cargo is throttling forward with strong partner and more capacity.

Among the world airlines, few can match Avianca’s history of surviving tough times, recovering and prospering. But the 105-year-old Bogota, Colombia based passenger airline, second oldest after KLM, has emerged from Chapter 11 bankruptcy twice, most recently in December 2021, after it shed its debt and had been grounded by the COVID pandemic. Today, it is in a strong but selective growth mode.

Avianca Cargo, its all-freight subsidiary, is a major contributor to the parent company’s success. Indeed, while Avianca itself discontinued passenger flights for nine months, Avianca Cargo’s freighters kept operating uninterruptedly during the pandemic and since.

As this is written, Avianca flies 150 routes to 75 destinations in 26 countries, in Latin America alone it serves 55 cities. So far this year, the airline has added Caracas, Montreal, Charles de Gaulle in Paris and Chicago O’Hare to its route list and is exploring opportunities to enter more new markets in 2025, officials say.

Avianca has long had a history of acquiring or partnering with other airlines which has helped fuel its recovery and route expansion. For example, in 2013 Avianca merged with El Salvador-based TACA Airlines and today is the third busiest carrier flying in and out of Miami International Airport (MIA).

But the airline’s most significant news for freight forwarders and shippers happened rapid fire in the past few months of this year—in addition to the opening of the four destinations.

In July, Avianca Cargo, (once known as Tampa Cargo was 100% acquired by Avianca in 2008, and its commercial partner, AeroUnion, a 22-year-old Mexico-based freighter airline) took delivery of the first of five wide-bodied Airbus A330 P2Fs that had been converted from a passenger plane to an all-cargo jet. The aircraft acquisition marked the first year of the collaboration of the two airlines, says Diogo Elias, senior vice president and leader of Avianca Cargo. Four more A330 P2F freighters will be added later this year and next, he adds.

The converted A330 P2F freighter, with a 61-ton payload and 37 pallet positions versus 32 positions in a A300-200 freighter, will increase cargo capacity by 60 percent compared to the existing aircraft in the Avianca Cargo-AeroUnion joint freighter network, explains Elias. (Avianca Cargo currently operates six of its own A330 freighters while AeroUnion owns five). “The A330 P2V is an ideal aircraft due to its higher volumetric capacity, lower environmental impact and enhanced fuel efficiency per ton,” he adds.

The new freighter will transport fruits, flowers and other perishable products plus oversized or project cargoes for the automotive, mining, oil sectors and e-commerce along the west coasts of the US and Latin America, says the Avianca official.

Freighter Flights

While Avianca Cargo has 220 freighter flights a week, forwarders and shippers have access to more than 1,800 passenger flights with belly lift. For example, Avianca re-launched its Bogota to Paris route this July after a 20-year absence, using a wide-bodied Boeing 787 Dreamliner. The airplane’s belly cargo space and five weekly frequencies on the route boosts Avianca’s capacity to more than 900 tons a week from Latin America to Europe, the airline’s top air cargo executive says. Besides Paris, the return of the route gives Avianca greater connectivity between 23 Latin American countries and Madrid, Barcelona and London, he adds.

Avianca Cargo is not going to diversify its freighter fleet. “We are sticking with the A330s. They’re nearly brand new, one of the most efficient medium sized aircraft operating in Latin America,” says Elias. In high demand seasons, the airline will rent space on another carrier or will “wet lease” another aircraft that will fit the volume shipped.

High-Value Time-Sensitive Freight

Over the years, Avianca has specialized in high-value, time-sensitive and various perishable commodities, both northbound and southbound, as well as outsized project freight. “Flowers, for example, is our main cargo out of Colombia and Ecuador to Miami and LAX,” contends Elias. “We also move a lot of fruit north from Brazil, Peru, Colombia and Ecuador, fish, mainly salmon out of Chile and tuna, fashion out of Brazil, also out of Ecuador, Colombia and Central America—and not just to the US but to Europe, Asia and Canada,” he adds.

Avianca has cultivated southbound markets from the US and Europe to Latin and South America transporting, mainly on freighters, pharmaceuticals, electronics, cell phones and parts, semiconductors — “you name it,” Elias smiles.

Interestingly, Avianca does have direct passenger or freighter service to Asia, but Elias points out the carrier has interline partnerships with large international airlines that serve global markets. For instance, Avianca has partnered with Turkish Airlines for Europe and beyond, Cathay Pacific which blankets Asia, Nippon Cargo Airlines (NCA) for Japan. “They take cargo to South America, or our markets and we distribute the shipments to our network of destinations,” he explains. “On the outbound, we can export commodities like salmon, vegetables and other perishables to Asia and elsewhere.”

On the other hand, Avianca is not directly participating in the booming wind power market which move via transpacific and European marine vessels and air freighters. Elias notes that the huge project cargoes that make up the wind towers do not always fit in the confines of the wide-bodied freighters currently in the Avianca or AeroUnion fleets. But the airline does have capacity and connections for smaller components required in the fast-growing sector of the alternative energy market.

Indeed, Avianca has not chosen to blanket the world with on-line stations simply to boast of an aggressive global expansion effort. Management appears more cautious. The airline, with 55 destinations in Latin America, has staked out both large and smaller niche markets for local air shippers and forwarders.

Not Chasing E-Commerce…. Right Now

Indeed, Avianca—its passenger and all-cargo flights — isn’t simply chasing high-volume tonnages to fill up its belly space and freighter capacity. Asked if the airline has courted Amazon with its daily air cargo lift requirements to move it huge and fast-growing e-commerce traffic in Latin America or beyond, Elias was candid.

“Our core business is mostly scheduled,” he says. “If there was an opportunity for a scheduled flight with them (Amazon), sure, we would look at it. We carry Amazon e-commerce cargo. But we do not negotiate directly with the company. Our forwarders — our direct customers — do that.”

But the cargo executive cuts directly to a more realistic reason for not targeting the massive on-line marketer’s traffic. “I don’t currently have an ACMI freighter dedicated to one customer, however, I wouldn’t say no. But we are not looking at it (full-freighter e-commerce) right now.”

Instead, Avianca has been focusing on providing more cargo in Central American markets —large and small, Elias says, citing San Jose, Costa Rica and others including Mexico, Panama and El Salvador.

Looking ahead, Elias discloses that Avianca is looking at “more than one new destination” for new service and at least one will be announced this year, although he would not divulge the name or identify others. With the AeroUnion freighter partnership, it’s likely that more Mexican cities will be added to the network, although Elias would not confirm the AJOT’s prediction. Avianca recently added Mexican cities Guadalajara and Monterey to its route map.

Avianca’s cargo presence at Los Angeles International Airport includes over five cargo flights per week–but no Avianca Cargo freighters so far. Are San Francisco or San Jose International possible new destinations where the cargo team could attract high value semiconductor or technology component freight? “We do go after those markets, but we truck the freight (from the Bay Area) down to Los Angeles or sometime all the way to Mexico City or Guadalajara or it flies out of LA to Asia on another airline,” Elias explains.

Avianca has recently invested in cool-chain cargo facilities at its strategically important airports, Elias told AJOT. Among them: Bogota, Medellin, Miami and Los Angeles which moves large volumes of perishables.

Overall, Diogo Elias is optimistic about Avianca’s air cargo volume in the remainder of 2024 and throughout next year. He sees more capacity to Asia and Europe, which the airline could capitalize on. Currently, the Bogota -based airline’s air cargo volume is 15% ahead of where it was pre-COVID.