Volaris Adjusts Guidance for 2023 Amidst Pratt & Whitney Engine Issues

Mexican low-cost carrier Volaris (Y4) has revised its capacity and financial guidance for the remainder of 2023 due to challenges stemming from the grounding of its A320neo Family aircraft powered by Pratt & Whitney PW1000G engines.

Volaris now anticipates a 10% increase in capacity, measured in available seat miles, for 2023 compared to the previous year. This adjustment reflects a decrease from the initial guidance of a 13% capacity increase. Additionally, the carrier has revised its estimated EBITDAR margin to reach 26%, down from the earlier forecast of 29-31%. Total operating revenues for 2023 are expected to range between USD 3.2 billion and USD 3.4 billion, with the revised guidance aligning towards the lower end of this range.

The impact on guidance is primarily attributed to issues related to Pratt & Whitney PW1000G engines and the rising costs of fuel. Volaris is actively addressing the engine challenges by implementing strategies such as optimizing its route network. The carrier foresees a temporary slowdown in its growth rate as it manages the necessary engine shop visits.

Enrique Beltranena, Chief Executive of Volaris, stated, “The Volaris team is actively executing plans to mitigate the engine inspection impact, including a project to optimize our route network. We anticipate our growth rate will slow while we work through the required engine shop visits. We will continue to modify our plans as we get more detail from P&W.”

Volaris operates a fleet consisting of A319-100s, A320-200s, A321-200s, A320neo, and A321neo aircraft. Currently, fifteen A320neo and two A321neo are parked for maintenance. Despite these challenges, the airline remains committed to its growth plans, with 142 A320neo Family aircraft on order from Airbus. The adjustments to guidance reflect the carrier’s proactive response to operational challenges in the aviation industry.