Tue Jul 10, 2018 5:56 pm
Well, there are several reasons for the CM bashing:
1. People only consider the economic cost of the ticket, i.e. price, but they don't consider the economic cost of time. A direct CM flight from PTY is going to be more expensive than a connecting flight somewhere else. But if you add the amount of time saved, the potential aggravation in the connecting airport (if you need to connect in the US or MEX as you need to go through customs and imigration), the different frequencies options, etc. It is cheaper to fly via CM than taking some other connecting flight (if we add all the costs: time, convenience, etc). But for most of the people, they don't take this last portions into consideration, as the ticket price is the only one considered. So when the CM ticket is high, people will complain (although sometimes I feel that they are abuse the prices a little bit, for example if you fly from X to SJO via PTY via CM is cheaper than if you fly from X to PTY, even after you remove the taxes to compare prices and have to take one less flight).
2. Part of the bashing is political. As the owner is seen as pro Varela and anti Martinelli (even though I think he donated to all 3 candidates in the last election), people will complain, just because of it.
3. Part of the bashing is from competitors. If you check Twitter, @UrsulaKiener likes to bash CM and PTY. If not mistaken, she used to work or still works at 7P (Air Panama). Now she is running as an "independent" to the National Assembly. She complains a lot about the airport infrastructures and airlines in Panama, but never once she has complained about 7P. And when Viva Air Colombia left BLB using the excuse of an increase of taxes (which they never paid, occurred 2 years before they left but complained about them, and most likely left BLB because Wingo was destroying them, plus Viva Air needed the planes for the new Viva Air Peru), she used that to also hammer CM and PTY.
4. Taxes and fees are also part of the problem. Lets check. At PTY there is the $40 exit tax, $2.50 security fee. A $10 tourism tax. And if you buy the ticket in Panama, you have to pay sales tax (you can give thanks or curse the last fiscal reform for that). Because PTY doesn't change transit passengers (it could be nice if they charged a token amount and that funds used for airport maintenance, but they won't) so that they could lower the taxes that O&D passengers pay. Last year 15.6 million passengers flew through PTY. The $52.50 tax was only charged to 2.3 million passengers collecting roughly 120 million (only departure passengers). If they charged $0.50 per transit passenger (roughly 11 million passengers), it could be roughly more than $5.5 million. That could offset the $52.50 to $49.78 per O&D Ticket. If $1 per transit passenger was used, then the offset would be from $52.50 to $47.39. I don't think transit passengers will complain for a small fee increase if and only if, that money is used to improve the existing infrastructure in PTY as long as the increase is small. And if you take away that $10 tourism tax (which hits the O&D passengers), then the taxes are lower (as it doesn't make sense to tax the consumers that you want to attract i.e. tourists or locals).
5. Prices are high due to low demand. Panama is one of the least populated countries in Central America and to make things difficult, the Panamanian diaspora is small, thus causing not that much O&D demand. If you only count the O&D passengers at PTY, the total passengers are roughly 4.2 million (2017). So, let say that we remove CM and P5 from the picture. How many destinations in the Americas would be covered? YYZ, EWR, ATL, FLL, MIA, MEX, SAL, SJO, BOG, CCS and VLN. How many less destinations in Europe would be there or higher prices to Europe? As part of the demand to MAD, AMS, CDG, FRA are transit passengers that CM redistributes?
6. Until the T2 opens, where can you put new operators if they want to travel to PTY? They have 2 options, either fly at undesirable hours or be limited in opportunities. PTY has been operating over 100% capacity since 2013 - 2014.