Arajet Named Company of the Year by Latinvex

Miami.- There is a new regional player in Latin American aviation: Arajet, a low-cost company started in the Dominican Republic in September 2022. The airline now flies to 23 destinations in 16 countries in the North, Center, and South America.

Bain & Co and alternative asset management company Griffin Global Asset Management are financial partners. Boeing Company and Vinci airports, based in France, are strategic partners.

Bain and Griffin will invest $3 billion in Arajet over five years, reports América Economía, a Latin American business magazine based in Chile.

The new airline faces competition from the two main airlines in Latin America: LATAM based in Chile and Avianca based in Colombia, as well as Cup based in Panama.

“There is a land grab – or air grab, if you prefer – in Latin America. Now between the different companies,” said Mike Arnot, an analyst at Cirium, told the Financial Times in June. “Each player sees opportunities to add capacity.”

The CEO and founder of Arajet, Víctor Pacheco, said he studied 100 airline failures in the Caribbean to learn from their mistakes. He maintains that the new airline is unique for two reasons. First of all, it is not based on taking passengers away from existing airlines, but creating new passengers. Second, unlike most other low-cost carriers in Latin America, which typically serve domestic markets, Arajet flies long distances.

“If we compare the market share of competitors, we see that they have not been affected in terms of the number of passengers flying in their airlines,” Pacheco tells América Economía. “You can even see that they have been growing slightly. So we have not entered the market to bring to your clients. We have stimulated new clients and are managing to captivate this new clientele to fly on Arajet.”

Nowadays it has become common to hear about the middle or lower class. Dominicans who had never flown before are excited about their recent trip to Medellín, Colombia.

Arajet also flies to destinations such as Argentina, Brazil, Chile, Costa Rica, Ecuador, El Salvador, Guatemala, Mexico, and Peru and Caribbean islands Jamaica, Aruba, Curaçao, and Saint Martin. The airline is waiting for approval to fly to the United States, Uruguay, Paraguay, and Bolivia.

Among the latest connections that Arajet has started is Canada, where the airline last month inaugurated flights to Toronto and Montreal from the Dominican Republic capital Santo Domingo.

“Arajet… establishes Santo Domingo as a new and interesting center in the continent for Canadians, connecting them with more than 10 countries in America, such as Brazil, Argentina, Chile, Curaçao, Aruba, and Colombia, with a low-fare airline that does not compromise the customer service and experience,” Pacheco said at a ceremony in Toronto on the occasion of the new connections.

Arajet hopes to replicate the success of Panama Cup by using a center to connect passengers throughout America.

The airline carried more than 500,000 passengers this year, and Pacheco expects 1.5 million next year when the airline obtains approval to fly to US destinations. Currently awaiting US approval from the Federal Aviation Administration, Arajet will fly to New York, Miami, and Port Rich.

It is estimated that 2.4 million people of Dominican origin live in the USA. American and US visitors typically make up around 50% of the total incoming passengers and flights, according to Pew data Research Center and the Dominican Ministry of Tourism cited by FDI Intelligence.

Arajet’s goal is to reach seven million passengers in 2028 using 40 planes.

Thanks to Arajet’s low prices, Pacheco believes prices have dropped among other airlines in Latin America. “The region needed Arajet,” he told FDIintelligence.

As a result of its strong growth and significant potential, Arajet has been named Company of the Year by Latinvex.

By: Latinvex Team

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