We revealed on October 27, 2009 that Star Alliance was in discussions with both Copa Airlines and Avianca-TACA over potential membership in the alliance....

Latin American carriers Avianca-TACA and Copa Airlines are to become member airlines of Star Alliance, following the unanimous approval by the alliance’s Chief Executive Board (CEB) of both airlines’ applications.

We revealed on October 27, 2009 that Star Alliance was in discussions with both Copa Airlines and Avianca-TACA over potential membership in the alliance. However,  Star Alliance now reveals TACA’s initial request for Star Alliance membership dates back to 2008.


Panama’s Copa Airlines has long been particularly close to Star Alliance member Continental Airlines (which is to be merged into United Airlines under the ownership of United Continental Holdings) and Copa Airlines CEO Pedro Heilbron was present at the ceremony for Continental’s induction into Star Alliance in November 2009. TACA was formerly close to the oneworld alliance.

“On behalf of the Chief Executive Board, it gives me great pleasure to invite Avianca-TACA and Copa Airlines to join the Star Alliance network. The addition of these two quality airline groups concludes a strategic process which increases the Alliance’s footprint in the vibrant, growing economies of Latin America,” says Jaan Albrecht, CEO of Star Alliance. “The aviation landscape in this region is changing rapidly and alliances are playing an ever bigger role as Latin America continues to develop.”

Colombian airline Avianca ordered and optioned a total of 70 aircraft from Airbus in 2007. Its purchase included a firm order for five A330-200s and options on five, as well as firm orders and options for 60 A319s and A320s

The combined network of the two airline groups will give Star Alliance a more prominent footprint in Central America, the Caribbean and the northern and western regions of South America, as well as additional direct connections between Latin America and cities in Europe. Star Alliance passengers will in future have access to a large range of new destinations and flights connecting through the Copa Airlines hubs in Panama City (Panama) and Bogota (Colombia) and the Avianca-TACA hubs in Bogota (Colombia), San Salvador (El Salvador), Lima (Peru) and San Jose (Costa Rica).

At the same time, the existing Avianca-TACA and Copa Airlines customer base will be able to access the global Star Alliance network and make use of the benefits that an alliance provides, such as collecting and redeeming miles on all member carriers.

The addition of the two carrier groups is the culmination of a strategic process to extend Star Alliance’s reach in Latin America. This began with the addition of Continental Airlines just over a year ago, improving connections between North America and Central and South America. Further network expansion and improved connectivity to, from and within South America was made possible by the joining of TAM Airlines in May.

“Copa Airlines’ membership in Star Alliance will enhance our global reach as we implement strong partnerships with the Alliance’s 27 carriers and link Latin America’s most efficient hub, our Hub of the Americas in Panama City, to Star Alliance´s vast global network,” says Pedro Heilbron, CEO of Copa Airlines. “In addition, our participation in the Alliance will enhance our already strong commercial alliance with United-Continental, in place since 1998.  We will now continue to build this value within the Star Alliance family.”

By mid-January 2010, Panama's Copa Airlines had taken delivery of 11 Boeing 737-800s and had 26 more on order. The carrier also operates 20 Boeing 737-700s and a number of Embraer 190s. Colombian carrier Aero Republica, the other airline subsidiary of Copa's parent Copa Holdings, also operates Embraer 190s and the two airlines' combined fleet of the type numbered 26 by mid-January

“As Avianca-TACA we are working towards becoming a valuable partner for Star Alliance and its members; it is a determining factor for our competitive strategy that will enable us to leap forward in terms of the scope and scale of the benefits provided to our passengers,” says Fabio Villegas, CEO of Avianca-TACA.

Avianca-TACA and Copa Airlines will bring 46 new destinations to the Star Alliance network. Once integration is complete, the customers of the 31 alliance members will have access to more than 22,500 daily flights serving 1,292 destinations in 188 countries.

Avianca and TACA (both airlines operate separately within the Avianca-TACA group) serve more than 100 destinations around the world, operating a fleet of more than 150 aircraft. The airline group directly employs almost 12,000 people and has more than three million members in its loyalty program. Avianca and TACA, which each consolidate several smaller Latin American carriers, agreed to a strategic merger in October 2009, creating a combined network focusing on North, Central and South America, the Caribbean and cities in Europe.

The two airlines of Copa Holdings – Copa Airlines and Copa Airlines Colombia – serve 52 destinations in 25 countries. The group recently strengthened its presence in Colombia, by rebranding Aero Republica to become Copa Airlines Colombia.

Although TACA is based at San Salvador in El Salvador, it also operates hubs at San Jose in Costa Rica (through subsidiary Lacsa) and in Bogota. The companies owning TACA and Colombia's Avianca have merged but the two airlines have kept their identities. TACA and Lacsa mainly operate a fleet of A320-family aircraft, including Latin America's first A321s, but also operate some Embraer 190s

Copa Airlines’ Hub of the Americas at Tocumen International Airport in Panama City, Panama handles major traffic from the Caribbean, and Central and South America. Copa’s entrance into Star Alliance reinforces its 12-year-old alliance with United-Continental. Copa left the Skyteam alliance in October 2009, as soon as Continental did.

Star Alliance says Miami airport will also benefit from the latest Star Alliance expansion, with the number of Star Alliance member carriers present rising from seven to nine. “For Miami, this strengthens its role as the gateway between North America and the south of the continent,” says Albrecht.

Integration teams from Star Alliance, Avianca-TACA, Copa Airlines and the Latin American airlines’ respective mentor carriers, Lufthansa and Continental, will now begin working in order to achieve integration of both airline groups by mid-2012.

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  • Erendira Matzumura

    November 10, 2010 #1 Author

    More good news for Copa Holdings which having reported very strong numbers on traffic load and capacity growth looks like an extremely attractive stock, specially given its relatively low P/E ratio and high operating margins.

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