AMERICAN AIRLINES

"The important thing is to think strategically and in the long term"

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Travel2Latam
Travel2Latam
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"The important thing is to think strategically and in the long term"
Thu September 06, 2018

To discuss the news of the markets under his charge, Travel2Latam interviewed Edson Jáuregui, Sales Manager of Peru and Bolivia of American Airlines.


What are the latest news of the company in terms of route openings and equipment renewals?

American Airlines plans in the medium term to replace the fleet with which it flies between Peru and the United States with new aircraft, with more passenger comfort and double cargo capacity. We will begin with the replacement of our Boeing 767 aircraft with a Boeing 787, with a new cabin configuration, more seats, audiovisual entertainment systems and Wi-Fi. This is part of the extensive renovation of our aircraft started since 2013 and which now positions us as the North American airline with the youngest fleet. As for new routes, we are constantly evaluating destinations and adapting our offer from our hubs in the United States, such as, for example, the new services to Berlin, Dubrovnic and Bologna.

What are the priority markets within Latin America and what are the potentials to be developed?

Due to the size of the market, Brazil, Mexico and Argentina are positioned as key markets in Latin America, but it is other emerging markets that are in fact giving us the greatest satisfaction. Among them is Peru, which has a very good rate of sustained growth. The focus is currently in Lima, which is a regional hub that we seek to promote more and more, for which the future implementation of our Joint Business Agreement with LATAM will be very important. Lima is a privileged connection point that allows us to transport passengers not only to and from the interior of Peru, but from other countries such as Chile, Bolivia and Argentina with a service according to the demands of the market. With the approval and implementation of our agreement with LATAM we hope to offer our clients in the country a number of benefits, including greater access to multiple routes, better connections and services.

What is the work like today with travel agents in the region? And with the OTAs?

Sales agents have always been very important in our distribution structure, and to the extent that they have been modernizing and adopting high service standards, they are an essential part of our business. At American, we see them as partners that allow us to generate value for the final consumer, and our goal is to give them the tools so they can promote our product effectively.​ The Online Travel Agencies have ceased to be the future, to become the present. What we see is that in general there is a convergence of online and traditional models in the industry, which is giving rise to the emergence of many agencies that we call "hybrid". At American, we recognize that it is very important to adapt our work and business strategies to optimally take advantage of what each agency, with its particular business model, can provide. Always in a win-win relationship for both sides.

How do you analyze the current situation of the Peruvian and Bolivian markets? What are the biggest differences with other markets in the area?

Both are markets with a lot of potential and great magnets for receptive tourism. I believe, however, that Peru has somewhat better growth prospects due to the growth and relative importance of business trips, compared to Bolivia. Similarly, Peruvian citizens do not require a visa to travel to several international destinations, for example, in Europe, where Bolivian citizens do require a visa. Therefore, there are structural factors that differentiate the demand behavior in both countries.

They have been operating in the Bolivian market for more than 25 years. What does this achievement have to do with? What is the value of the region for a company of the size of AA?

We have been operating for 28 years in both the Peruvian and Bolivian markets, in fact, the operations started with a few days of difference and, initially, our service to Bolivia was with a stopover in Lima. Over time we have managed to consolidate the operation in both countries. Last month we stopped operating in La Paz to concentrate our operations in Santa Cruz, Bolivia, because by doing so we aim to improve our profitability. However, it is clear that the value we generate in the cities and countries in which we operate is substantial; We know that we are an important part of economic development and we are always aiming to add more.

From Peru, American Airlines continuously shows significant growth towards the Asian region. What does this growth have to do with? What are the development projections?

This growth towards Asia is mainly due to shipments of products to this continent through American Airlines Cargo, including asparagus, blueberries, lettuce and fish; and among the non-perishables are handicrafts and textiles. Next year we will have 15 additional boarding gates in Dallas / Fort Worth, which will not only offer more connections, but also greater availability of cargo dispatches to the Asian continent, where we currently arrive with six direct flights from that city.

Since July, Santa Cruz became the center of the operation of the US airline in Bolivia. What does the departure from the La Paz market have to do with it?

Mainly due to a plan to improve our profitability, Santa Cruz is the city with the highest demand in the country. However, this does not mean that we are not interested in continuing to develop other places, only that we are changing our approach. From this month an interline agreement will be in force with the Bolivian flag airline, Boliviana de Aviación (BOA). It is the first time that we have established an agreement of this nature with a Bolivian airline, which is also state-owned; which will allow us to continue transporting passengers to and from La Paz, Cochabamba, Sucre and Tarija, with connections and optimal prices. We are confident that the number of passengers transported will continue to grow and in the future it will not be unreasonable to think of an upgrade on the plane that goes to Santa Cruz.

In a highly competitive market, which is experiencing important changes along with the arrival of new players, how does the aeronautical industry analyze today? What potentials do you see?

The important thing is to think strategically and in the long term. The aviation industry will always see its best days as long as there are sustained policies of market opening, creation of infrastructure and a healthy regulatory environment that does not paralyze innovation and investment. It is a complex industry and in a permanent state of evolution, where overnight you can go from having profits to losses. The arrival of new players, such as low-cost airlines, is positive, as is free competition in general. As long as the airlines compete on equal terms, which is not always the case, the biggest beneficiary will be the final consumer.

How do you see the evolution of the aeronautical sector in a few years?

In Latin America there will continue to be a massive movement towards consolidation, which is the way that airlines have to respond to dynamic and highly complex environments, in order to have profitable operations and sustained growth over time. We are following the trends that have already taken place in other regions where, along with the appearance of new low-cost competitors, mergers and alliances between established companies take place. The emphasis on operational efficiency and benefits for consumers will remain paramount, as there are still many challenges ahead, especially in the adoption of new technologies.

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