A decade of growth has transformed air travel in Colombia from an option confined to the well-off to an increasingly accessible way for ordinary people to travel. Continued dynamism will come from many angles. Increased competition among domestic airlines is opening regional routes, while rising numbers of foreign visitors are attracting several international airlines to the market. To keep pace with market growth, a series of expansion and renovation projects is taking place across the airport network, as large and medium-sized airports compete for the increased traffic.

Such change has spurred more aggressive pricing and prompted a rethink in the air transport business. The mass growth of domestic air travel has been made possible through the establishment of various tariffs. Stronger links with several international regions, meanwhile, are improving the environment for both business and leisure travel. The result has been a tripling of passenger numbers over the past decade, from 10.8m in 2003 to 29.5m by the end of 2013.

Despite the heavy operating costs associated with air travel, liberalisation has given the sector enough agility that it can occasionally compete on price with public road transport. For certain routes – some flights from Bogotá to the coastal city of Cartagena, for example – airfares can be up to 20% lower than the same trip would cost by land. In this sense, the country’s poor road infrastructure provides a strong incentive for the development of air travel – at least for the passenger market, if not for cargo as well.


Although there are a total of 75 airports under the care of civil aviation authorities, most passenger and cargo traffic runs through a handful of big and medium-sized airports. Small airports tend to link up the more isolated, rural departamentos (provinces), especially in areas such as the Amazon or the Orinoquía, which have insufficient road infrastructure and thus depend on transport by river and air. Management of the 18 of the country’s airports run by private operators (through concession agreements) has been transferred to the National Infrastructure Agency (Agencia Nacional de Infraestrutctura, ANI), which is now in charge of all private-public partnerships.

Rising Capacity

Private management of airports has been a boon for the sector. Passenger numbers rose 13% in 2012 and another 16% in 2013, according to figures by the Colombian Association for Air Transport (Asociación del Transporte Aéreo en Colombia, ATAC). Airlines have increased capacity to serve the rising demand. This led to 43% growth in the number of seats available on international flights from 2009 to 2013, and a 53% rise for domestic routes. In the same five years, the number of domestic and international flights grew by 17% and 30%, respectively, according to ATAC. “The airlines have done a good job adding capacity despite the limitations of infrastructure,” Gilberto Salcedo Ribero, executive director at ATAC, told OBG.


The domestic market has typically been more dynamic than the international one. The biggest airline operating in Colombia remains Avianca, which has a large network of domestic flights, international connections to some of the world’s major cities, as well as operations in the domestic markets of Peru and Ecuador. Chilean airline Lan has established itself as the second competitor in the Colombian market, with an array of links to South American capitals. Panamanian carrier Copa has a solid foothold as well, but recently announced it will abandon some 10 of its national routes, prompting both Avianca and Lan to request control of these slots from Colombia’s Civil Aviation Authority (Aeronáutica Civil de Colombia, Aerocivil). Some of the newly available routes offer strong market opportunities to carriers with the capacity to serve them, such those between Bogotá and cities like Barranquilla, Cali, Bucaramanga, Cartagena and Medellin. The Bogotá-Cartagena route grew by 13% in January-August 2013 while Bogotá-Cali increased by 16% over the same period.

There are other carriers as well. State-owned Satena, run by the air force, provides flights to isolated regions. Easyfly, which offers low-cost regional flights to some intermediate cities, has announced it will expand internationally into destinations in Ecuador, Curaçao and Arruba. Viva Colombia, the country’s first low-cost competitor, entered the market in 2012, focusing on some of the most sought-after routes, between the cities of Bogotá, Medellin, Cartagena, Cali, Barranquilla and Bucaramanga. Viva’s entrance has led to tighter price competition from the incumbents, which have been able to adapt to the new market conditions through price segmentation. “These days, the low-cost and traditional airlines are very similar in Colombia because of the high level of competition coming from the established players,” Salcedo said.

International Routes 

International carriers are connecting several Colombian cities to the rest of the world, further boosting competition. As of July 2014, Colombia was receiving 863 flights a week, operated by 20 carriers. Airlines will also be eyeing the possible exemption from tourist visas for Colombians entering the EU. Five airlines currently connect Colombia to Europe – Avianca, Air France, Lufthansa, Iberia and Portuguese airline TAP – and if the visa process gets easier, this market may become even more attractive.

Increased demand for travel between the US and Colombia prompted American Airlines to start running daily flights between Dallas, Texas and Bogotá in November 2013, bringing its weekly flights to Colombia to 42. The airline also flies three daily flights between Bogotá and Miami, twice a day between Medellin and Miami and once a day between Cali and Miami.

In early July 2014 TAP started four weekly flights from Lisbon to Bogotá and on to Panama. The airline expects this route to yield 75% occupancy in its first year of operation, projecting that 60% of passengers will stay in Bogotá, with the rest travelling on to Panama. Since reservations became available in April, 20,000 seats have been booked, guaranteeing full occupancy for the first seven to eight months of operation.

Expanding Capacity At El Dorado

Most flights from abroad land in the capital’s El Dorado airport. Despite considerable expansions since the current concession-holder Opain took over operations in 2007, the exponential increase in traffic has driven capacity to near 100%, according to ATAC. In October 2013 the airport opened a new 65,000-sq-metre terminal for domestic flights, part of a $900m investment including a range of other improvements. Avianca has already transferred 65% of its domestic operations there.

Bogotá remains the most important cargo hub in South America, according to ATAC. Although it moves smaller quantities of goods than other cities do, it is generally reserved for high-value products, such as emeralds, flowers and gold.

Part of El Dorado’s continued development will include the move of military and private aviation infrastructure currently located at the facility to a 700-ha area elsewhere the Cundinamarca province, where a smaller airport is due to be built by 2018. A railroad will connect the two facilities, mainly for freight. Growth is expected to continue. The airport’s master plan estimates that the number of passengers will reach 29m by 2016, and 38m by 2021. Space for parking aircraft could become a problem: the master plan forecasts the airport to have 74 spots by 2018, but according to ATAC, it will need closer to 100 to take on the expected growth in passengers.


As necessary as the new infrastructure is, it will take time for its impact to be felt across the system. In the meantime, other measures will increase efficiency. One improvement made by Opain is a new fuelling structure that started operations in June 2014. The $75m system will reduce fuelling times by replacing most of the trucks used to refuel airplanes with a tubing system. Whereas the previous scheme used 27 trucks that would perform 400-500 operations a day, the new outfit has cut the number of trucks to five, replacing them with 12 km of pipes. The kit will be installed and run by US contractor Allied Aviation.

The upgrade is not without a cost. Opain has announced that the new system will raise fuelling prices for airlines by up to 1.5%, the equivalent of $0.50 per gallon. This could trigger a rise in airfares from airlines using the El Dorado airport, though it is up to each operator to decide whether to pass those costs on to consumers. Opain is also running an analysis to find ways of improving Customs operations. Upon arrival, passenger transfer to the city is expected to smooth since the Transmilenio public bus system began running a line to the airport in June 2014.

Regulatory Barriers

While much of the current development at El Dorado is aimed at turning Bogotá into a regional hub, some regulations may pose a challenge to this – especially when it comes to the right set of incentives for concessionaires. One case in question is the airport fee system, which charges an airport usage fee for passengers flying to and from Bogotá, but exempts transit passengers. “It’s incredible to think that an Ecuadorian or a Peruvian going to Barcelona through Bogotá can use our airport for free, but a Colombian is expected to pay a fee,” Andrés Ortega Rezk, general manager of Opain, told OBG. “For us this is a disincentive to promote the increase of transit passengers,” he added. “We would get more use of facilities and equipment with little benefit.” This is an example of where a small change in legislation would do much to push airport operators to attract more transit passengers – an essential condition for any air hub. Opain and other sector operators are working with Aerocivil to come up with an alternative.

Competing In The Region

Despite the potential to become a preferred entry point to South America, both Colombia in general and El Dorado in particular face competition from several of the region’s airports. Devising the right incentives is among the sector’s top challenges. Currently, El Dorado is the fourth-most-expensive airport in the region, after Quito in Ecuador, Panama City and Argentina’s Buenos Aires Airport. “It will be hard for Colombia to become a hub like Panama unless regulations are changed,” Sara Ramírez Restrepo, general manager at Operadora de Aeropuertos Centro Norte, which runs six airports in the country, told OBG. “Though Colombia has a richer international potential, Panama has done a better job opening up to the world through international agreements. With current rules protecting the national airline, this will not be the case here in the short term.”

One effective way for airports to attract traffic is by low landing fees. Lima’s Jorge Chávez International Airport offered free landings to new airlines for the first two years. The Mariscal Sucre International Airport in Quito gave a 30% discount in its first year of operation. Similar measures would help Colombian airports, according to ATAC. Regulations at regional airports, too, can affect the competitiveness. In early 2014 the airport at San Andres hiked its fuelling prices from COP60 ($0.03) per gallon to COP1200 ($0.60) per gallon. Fuel provision (including the cost of fuel itself) can account for 35% of airlines’ total operational costs.

Part of the challenge is the authorities’ approach to airport concessions. The strong emphasis on ensuring that these are profitable for the state limits the ability of private concessionaires to improve services, and can impede their efforts to make air transport more efficient. “A lesson we have learned is that concessions need not be purely designed with state revenues in mind,” Salcedo of ATAC told OBG. “At the end of the day, 46% of concession earnings at Bogotá airport go straight to the public coffers. The concession-holder must make do with the rest and still be able to develop new businesses and be efficient in its operations. In addition to this situation, the concessionaires maximise their revenue through overpricing services to the airlines, threatening the competitiveness of the industry, the airport and the country.”

Improving Infrastructure

Despite this, the current concession model is attracting investment to the sector. Authorities understand that, to take full advantage of current growth, infrastructure needs to improve in the short and medium term. Hence several airport expansion projects are planned or ongoing, not only at the main airports that serve the big cities, but also at air transport points that connect the regions.

Set to be tendered in September 2014 is the second phase of renovations at Palo Negro Airport in Bucaramanga, at a cost of COP60bn ($30m). This phase will expand the passenger terminal from 80,000 sq metres to 190,000 sq metres, while the first phase is to extend the runway for COP23bn ($11.5m). According the ANI, both should be finished by 2016.

Modernisation work has also begun at the Alfonso Bonilla Airport in Cali, Colombia’s third city. The project has a budget of COP200bn ($100m), and will be carried out by the current concession-holder, Aerocali. Work will focus on renovating the existing terminal and building a new one with 14 gates.

Building Connections

Other airport revamps in several of the regions are strengthening the connections between some of Colombia’s medium-sized cities and international capitals. The renovation of Matecaña airport in the city of Pereira, valued at COP53bn ($26.5m), will allow Avianca to start running three weekly flights to New York in July 2014, linking Colombia’s coffee-producing region to one of the world’s chief financial centres. The project’s current phase is to build a new control tower. In the summer of 2014, authorities will choose a contractor for the second phase to renovate the passenger terminal as well.

Four other tenders for key expansions are scheduled to reach the market by September 2014. According to the ANI, authorities expect COP500bn ($250m) of investments in the airports of Barranquilla, Neiva, Armenia and Popayán. The biggest of these will be the renovation of the Ernesto Cortissoz Barranquilla Airport, which will cost $128m, according to a report published by CG/LA Infrastructure in 2014, which ranked key infrastructure projects in Latin America.

An added risk for airport concessionaires investing in such expansion projects remains in the differential between peso and dollar. At El Dorado airport, for example, 70% of contracting work is paid in Colombian peso. The international airport taxes, however, are paid in dollars, making concession-holders’ revenues subject to considerable variations.

To The Skies

As the domestic market grows, becomes more competitive and attracts the interest of international airlines, air traffic is set to continue on an upward path. “The expected economic recovery of the US and Europe, plus the removal of a Schengen visa for Colombian citizens, signify an increase in demand for the aviation sector, as happened in countries like Mexico or Brazil,” Fabio Villegas, CEO of Avianca, told OBG.

Effective growth will depend on how authorities deal with two essential challenges. The first is making sure that the infrastructure developments currently under way match the growth in demand for services over the medium and long term. The second is the regulatory framework, which puts high importance on the return that concessions bring in for the state, at the expense of attracting new airlines, opening new markets and securing the best possible service at the country’s airports. Developments in the aviation markets may soon require a more holistic approach to managing Colombia’s airports. Most needed of all is an overall policy to attract and retain new airlines, and to compete effectively with the region’s rival airports.