A few years ago, when Chavez announced that he would start a national airline again, I wrote a post criticizing the move as another waste of money in a country with limited resources and a lot of more important problems than having a flagship Government airline. My reasons were many, but it included the fact that the airline business is well known to be a very difficult one, as recurrently even the best run airlines in the world go bankrupt or close to it, when conditions are adverse. Add to that the history of Venezuelan airlines, both private and Government run, together with a bunch of inefficient military officers in charge and I could see this was a boondoggle Venezuela did not need. Many of the more pro-Chavez readers jumped on me, saying the country should have an airline and flying in it was more reasonably priced than private airlines.
But in time, Conviasa has shown to be an even bigger failure than I ever dreamed of. I never thought we would see so many accidents. Seven serious accidents in such a short life is unheard of in the world of airlines, no matter where they come from. This shows how this Government is so indifferent to the value of the life of its citizens. Then there is the fact that Conviasa bought a bunch of Brazilian Embraer planes for US$ 90 million, which somehow the Chinese buy for half as much according to Gustavo in the same link as above. And to top it all off, last April Venezuela was put on the no fly list by the European Community, a ban that was reiterated this week.
But rather than find out about how to get off the list, the Government blasts the European Union and criticizes more the fact that the ban is called a “black list” and thus racist, than the actual reasons for the ban. Even worse, in this Bolivarian revolution world, where profits don’t matter, Conviasa has been using airplanes from Santa Barbara Airlines (A Venezuelan private commercial airline) and ¡Fin de mundo! a US airline called Vision Airlines, in order to continue flying to countries in the European Union. If Conviasa was losing money before, imagine doing it having to pay someone else to do the job!
Economics is about optimizing scarce resources. In a relatively poor country like Venezuela, that optimization is even more important. The worst part, is that Conviasa is still flying, money is still being wasted, without any rationale for it. At least other Chavez boondoggles like Venirauto, stopped being much of a sinkhole. While supposedly the company is still functioning, here is a picture of some vehicles waiting to have the natural gas system installed before the cars are sold:
Not pretty, no? At least nobody died…