Despite facing the highest fuel prices in the history of the airline industry, Aeromexico reported an operating margin of 12% in the third quarter and anticipated revenue growth of nearly 20% by the end of this year.
Andrés Conesa, CEO of the airline, highlighted that companies are facing unprecedented pressure due to the rising cost of jet fuel , which currently costs five dollars per gallon.
The executive explained that Aeromexico’s annual fuel purchase cost will increase from around one billion dollars to 1.7 billion dollars.
However, he asserted that the resilience of travel demand has offset much of that impact. Although the company lowered its outlook for the fourth quarter due to rising fuel costs and the peso’s depreciation against the dollar, it maintains expectations of growth and strong cash flow generation.
“Despite the fuel situation, we are projecting to close the year with a cash level identical to that of 2025, without taking on debt and without reducing investments,” Conesa said in an interview during his participation in the ALTA AGM & Airline Leaders Forum.
In this regard, he stated that the airline maintains its investment plans in Boeing 787 aircraft, technology and operational improvements, including projects at Mexico City International Airport (AICM).
The executive acknowledged that the rise in operating costs is already being reflected in airfare prices. In addition to fuel, Aeroméxico is facing increases in labor costs linked to inflation.
Even so, he maintained that rates, in real terms, remain below the levels seen a decade ago and that the company retains a competitive position.
“We have been affected by about 60%, we are paying the highest fuel prices in the history of aviation, although oil is not at its highest level like all refined products, so it has to be reflected in prices (tickets),” he said.
The World Cup affected traffic
Conesa revealed that the recently held World Cup had a negative impact of approximately $25 million on revenue for Aeromexico, mainly due to a temporary reduction in business travel.
He explained that during the Mexican National Team’s matches, corporate travel to key markets such as Monterrey, Guadalajara, Mérida, and Tijuana decreased, as part of the demand shifted to the sporting event.
However, he noted that the World Cup also spurred investments of nearly $400 million in airport infrastructure and motivated improvements in the passenger experience.
New routes on the way
Regarding the end of US restrictions, Aeromexico announced that it is working to obtain the necessary authorizations to soon announce a first package of new international routes.
Although he avoided revealing the destinations due to a lack of regulatory permits and slot availability, he indicated that some operations could start in early 2027 and others towards the summer season.
Conesa noted that one of the issues that continues to be under observation by the US aeronautical authorities is the budget of the Federal Civil Aviation Agency (AFAC).
While expressing confidence that Mexico will retain Category 1 air safety status, he stressed that it will be the responsibility of the authorities to ensure that the agency has the necessary resources to maintain internationally required standards.
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