JetSMART CEO: ULCC Failures In Colombia ‘Opened The Window’ For New Entrant

BOGOTA—JetSMART CEO Estuardo Ortiz said he thought the ULCC would expand to the Colombian domestic market “later in the game,” but saw a post-pandemic opportunity to enter a market in which two ULCCs failed in 2023.

JetSMART Colombia—the third spinoff South American subsidiary of the Indigo Partners-backed airline, based in Chile—launched operations last week with an initial seven domestic routes. An eighth will start in May. JetSMART already operates carriers with air operator certificates (AOCs) in Peru and Argentina, in addition to its home market of Chile.

Speaking at the Routes Americas 2024 conference here in Bogotá, Colombia, Ortiz said the failure of multiple airlines in Latin America since 2020, including Ultra Air and Viva in Colombia in 2023, made expansion into another market feasible. “I think the pandemic opened opportunities we never thought were going to be there,” he explained, adding that JetSMART “always believed” in the Colombian market.

More News And Analysis From Routes Americas 2024

“We always knew we wanted to be here,” Ortiz said. “For us, this is a tremendous opportunity for growth. Columbia [as an airline market] is larger than Peru, Chile and Argentina together ... It was not originally planned, but we're very happy that we started operations in Colombia last week.”

Ortiz said the failures of Ultra and Viva “opened the window” for JetSMART to enter the Colombian domestic market.

Asked whether JetSMART would seek AOCs in other South American markets, such as Brazil, Ortiz said the airline’s focus is on scaling its current carriers. “I think for us now, it's really about focusing on those four markets,” he explained. “So, [another AOC is] down the road.” He added that Brazil “of course is a tremendous opportunity … But we'll have to wait. I think we have a handful for now.”

Meanwhile, Ortiz confirmed JetSMART, an all-Airbus A320 family operator, will not receive any Airbus A321XLRs until at least 2026. The carrier is expecting to receive 14 of the type as part of an Indigo Partners order, and is slated to be the aircraft’s launch customer in Latin America. Airbus has delayed first deliveries of the aircraft, previously planned for 2023. It now aims to start delivering the narrowbody to airlines in the 2024 third quarter.

The A321XLR will offer a range of 4,700 nm (5,400 mi.). JetSMART has said it could use the aircraft to fly long, thin routes, such as from Santiago, Chile, to the Caribbean and Miami. 

“We do see potential in the aircraft because of course you can fly south to north, so South America to Central America, the Caribbean, various destinations, at lower costs … Everybody wants to go to Miami. It’s really expensive, so we can make it cheap,” with the A321XLR, Ortiz said.