Volaris’ GTF mitigation strategy pays off as impact expected until 2027
Despite delivering a full year 2024 operating revenue of $3.14 billion (up 3.6% year on year), Volaris continues to face ongoing engine woes – which, combined with aircraft delivery delays, will require ongoing planning in order to “maintain equilibrium between supply and demand, thereby preserving… stability and leadership in [its] core markets”.
“Despite continuous adversity from GTF engine inspections and aircraft groundings, we generated some of our best top and bottom-line results,” explained President and CEO Enrique Beltranena, pointing to a “remarkable year” in which the Mexican low-cost carrier posted a net profit each quarter.
However, with mandatory inspections of the Pratt & Whitney GTF engine affecting more than half of Volaris’ fleet engines as of January 2024 (and presenting a “critical strategic challenge”), Volaris faced a 30% reduction in its productive fleet. Subsequently, a mitigation plan included additional operating leases and extensions, engine purchases, and a new base itinerary – operating its schedule exclusively with Volaris’ own pilots and aircraft.
This, continued Beltranena, was a decision that has proven “highly effective,” with Volaris achieving 99.5% scheduled reliability and 83% on-time performance for the year. The airline has now successfully completed its early inspections of P&W engines, managing an average fleet reduction of more than 30 aircraft. However, looking ahead, Volaris anticipates “the ongoing revisions to affect a significant portion of [its] fleet not only in 2025, but also in 2026 and 2027”.
Additionally, delayed aircraft deliveries continue to pose another problem, with Volaris having taken delivery of “just” 15 out of its 144 aircraft order book for 2017 and 2021 orders. Citing OEM supply chain challenges, a revised delivery schedule with Airbus will stagger aircraft arrivals until 2031. Volaris’ strategy “will require elevated deliveries in 2026 as we balance capacity,” revealed Beltranena – although inevitably, for 2025, Volaris’ capacity will be below that of 2023.
