JetSMART is a Latin American low-cost carrier on a rapid growth trajectory, according to CEO Estuardo Ortiz.
Chile-based JetSMART Airlines lives up to its name. It is intelligently run and efficient, boosted by its ownership links to international airline conglomerate Indigo Partners.
While the carrier does not need direct links to Indigo’s other airlines (Wizz Air, Frontier Airlines and Volaris), JetSMART’s rapid growth is helped by the scale of Indigo’s massive 430-aircraft order in 2017.
Seventy of those aircraft are now being delivered to JetSMART in addition to 21 previously ordered. Once completed, the low-cost airline will become one of the top five airlines in Latin America by total aircraft size.
JetSMART also has a handful of aces in the Latin American poker game. It is the first low-cost carrier to sign a codeshare with American Airlines (AA). In 2021 American announced a minority investment in JetSMART, as well as a link to AA’s popular AAdvantage loyalty programme.
“The AA codeshare has been implemented in Peru and Chile, and it will start in Argentina and Colombia this year,” said JetSMART CEO Estuardo Ortiz at Routes Americas.
“AA recognised that JetSMART could provide distribution in Latin America,” he said. The move came after long-time AA partner LATAM changed alliance to Delta Air Lines.
JetSMART jumped into the Colombian market in March, before it had planned to, due to the failure of two domestic airlines, Viva and Ultra Air.
“We knew we wanted to be in Peru and Colombia at some point,” said Ortiz. An airline veteran whose career has included executive roles at Grupo TACA and Avianca, he noted that 12 airlines in the region have failed or didn’t restart after the pandemic.
“There were seven airlines in Peru, now two. There were seven airlines in Colombia, now three. JetSMART launched services from Bogotá and Medellin with eight routes. We knew it was the time to go,” he said.
Ortiz, who has led the 26-aircraft carrier since it was founded in 2016, said there were “conversations” to acquire one of the defunct carriers in Colombia, but “in the end the conditions were not there, and we looked at our own operation.”
JetSMART will not sit still with its initial eight Colombian routes. “There are lots of opportunities on international routes. We will have a base in both Medellin and Bogotá.
JetSMART’s fleet currently comprises Airbus A320 and A321 aircraft. The airline’s 91 additional aircraft on order include 45 A321neos and 14 A321XLRs, both capable of reaching well into the United States. JetSMART expects to have 100 aircraft by 2027, which may mean it will receive a new airplane every 10-12 days until then.
“With the A321XLR we can fly south to north, and I see a lot of potential,” Ortiz said. The A321XLR’s 4,700 nautical mile range means previous widebody-only routes such as Santiago to Miami and Orlando are within reach, as well as Lima–Los Angeles and Bogotá–New York.
Expansion brake
Ortiz believes Latin Americans would flock to the air if taxes were lower. “We’ve already seen this in Chile, where the market has grown 28% in two years” after taxes were lowered. “I see changes in Argentina and Brazil coming. We would be surprised how many people would travel if taxes were revised,” he said.
With Argentina’s new government, JetSMART might be able to expand into several markets. “We will soon operate a route we’ve wanted for a long time, from Aeroparque [airport in Buenos Aires] to Montevideo. In Argentina, we have seen more change in the last three months than we have seen in four years.”
It appears the only barrier to JetSMART’s unbridled growth is Latin America’s lack of airport infrastructure.
“Some airports in the region are restricting,” he said. “There must be a reason why airlines want to fly to your airport, and you must understand our costs. If your infrastructure means our taxi times are high and costs are high, there’s no incentive for us to fly there.”
