Podcast: Awesome Cargo’s Luis Ramos on A330 launch, Mexican market

Jeff Lee
Hello and welcome to this episode of cargo facts connect, the podcast of cargo facts, the newsletter of record for the air cargo and freighter aircraft industries for over 40 years. I’m Jeff Lee, editor of cargo facts and it’s Monday, the 11th of September. Today I’m joined by Luis Ramos, founder and CEO of awesome cargo, a new carrier based in Mexico that will soon complete the certification process and is looking to expand into the freighter segment. Hey Luis, thank you for joining me.

Luis Ramos
Hello, Jeff. Good morning. And thank you for inviting me today.

Jeff Lee
Sure. So it’s been a while I mean we talked to you in Panama in May, and that was already four months ago. So catch us up? What’s the latest? What’s going on with awesome cargo and your AOC?

Luis Ramos
Yeah, no, we’re very excited. Aircraft one arrived into Mexico City, at our new cargo airport, Santa Lucia airport, we finalized our contract to have an MRO facility, which will be the home of awesome cargo. In the interim, we have been hard at work at the aircraft. Number two, to have it converted into into an Avensis STC. And we should have that aircraft ready and flown into Mexico by next month. And in parallel, we’ve been hard at work with our Mexican authorities, the Mexican AFAC Civil Aviation Authority of Mexico, to try to get our aircraft operating certificate on our demo flights on their way. And we’re very fortunate that the authorities have helped us a lot. We’re very thankful for the Mexican government and the Afac for moving as quickly as they have in the midst of having everything that’s going on with with the FAA and getting back to category one. So we’re very thankful with our authorities, and we finally see the light at the end of the tunnel, we think we should be given green light this week or the following to start our demonstration flights.

Jeff Lee
Great. And then you give a rough timeframe for when you make the the the final AOC?

Luis Ramos
We expect to have it by mid October.

Jeff Lee
Okay. You mentioned the MRO facility. Tell us a bit more about that?

Luis Ramos
Absolutely. Yeah. It’s the only civil MRO at the new airport. It has 46,000 square meters covered space. And additionally, another 40,000 square meters of ramp space where we can have simultaneously up to six 747s. We also have a storage facility where we will have specialized shops for engines and special tooling in partnership with with a company that I can’t say the name right now. But we’re very advanced in some talks with a very known party, which will potentially partner up with us for this for this new venture. We’re very excited because the cargo operations have moved to Mexico to the New Mexico City Airport Santa Lucia Felipe Angeles, roughly we have about 24 cargo operations per day, the new airport and at some point, we’re sure that that having an MRO facility with FAA permits with our 145 and our EASA permits, apart from our Afac permits will be very beneficial for our customers and our partners in case they have an AOG situation.

Jeff Lee
And just going back to You’re on your own feet. Like you said, you have them in your second A330 almost ready. Perhaps just let’s go back a bit to when you started this whole thing. What were the main reasons for selecting the A330 200?

Luis Ramos
We think it’s the right aircraft for the region. The 767 freighter is our is our preferred aircraft, when you’re talking about Central America, northern South America and then Mexico in the US. However, as the 767 program ages, we felt the 330 was the right fit for us to connect the region. So, for starters, we will start with the two Airbus 330 200s. But I think it’s about time, Jeff, for me to share something with you. We are incorporating Additionally, two 737 800 BCFs full freighters by the end of the year.

Jeff Lee
Oh, yeah. I mean, then you will have both a wide body operation and narrow body operation. You do you already have agreements confirmed for those?

Luis Ramos
Yes, we do. We already have letters of intent signed, and we’re finalizing the lease agreements with a major lessor that has been a great partner for us and super patient. Because the 737 program got delayed a little bit, obviously, because we didn’t have the technical bandwidth to have concurrent launches of two different family aircraft. Plus the category one category two issue was, was definitely something that we were watching very closely. It was announced last Friday by our Mexican president, that the category one would be recuperated soon, we will wait for the official notification from the corresponding authorities. But this is certainly something that the entire Mexican aviation industry is celebrating,

Jeff Lee
Yeah no that will be very significant. And I guess that also figures into your plans and for your operations. Since you already have, you know the Airbus A 330s. Why did you go for the 737 800 as opposed to let’s say, the A321 or an A320?

Luis Ramos
So this, this was a very difficult decision for us. But based on the routes that we want to operate, having a few airports that are high and hot, and then the range that was required for the for the business, we thought that the 737 800 was the preferred aircraft for us in the region, the 321 freighter seemed to be a cheaper aircraft to operate. It also gave us additional capacity in terms of volume. So it’s definitely the right aircraft, for e commerce and for volumized cargo. But the issue is on the 321, that the range is shorter than the 737. So that aircraft would work very well, if you had high yielding high optimization cargo in a certain region that has shorter routes that need to be operated. For us, we thought that the 737 was a better fit in the market in the region and with the current market conditions.

Jeff Lee
Alright, great. I mean, that’s super exciting for you. And you still your intention is still for the 2 A330s to eventually be converted into full freighters. Right. Is there any update on the timeframe for that?

Luis Ramos
No, Jeff, unfortunately, there isn’t. So hopefully, anyone that’s listening right now that has conversion slots available if they have them they can contact me, you can give them my cell phone. Because we’re literally just Standing by for whatever, that’s a possibility, there’s a few different conversion lines that have been opened for the 330. Family. So we think that the slots will will become more available, especially since the market of aircraft freighter aircraft cools down worldwide, and a lot of people that speculated on conversion slots are realizing that some airlines may not want to convert with the same level of appetite as they were converting a few years back. So we’re staying positive, that we’ll have opportunities to do so in the shorter term. And, of course, you know, concurrently with the two a330s that we have, it’s our plans to get additionally two more Airbus 330s, while these aircraft are being converted,

Jeff Lee
Right, two hundreds or maybe three hundreds?

Luis Ramos
That hasn’t been determined yet. That depends on who you ask internally. It can be 300s or 200s.

Jeff Lee
Okay, now, that actually brings me to probably the last question, but you were saying how the market generally is a bit depressed and I mean, we’re seeing that in most regions around the world. But when we talk about Mexico, specifically, what’s the situation there? And how is it different from the rest of the world?

Luis Ramos
Well, I mean, you have to take a few things into consideration, right? Mexico is geographically positioned, just south of the US, we are the US closest, if not the closest their first or second trading partner, there’s been significant amount of capital that have been coming into the country in the form of foreign direct investment. So we do believe that in the next five years, this so called phenomenon of nearshoring, will definitely catapult the Mexican market of airfreight into a whole different dimension, we want to be ready for that. At the same time, we must be cautious about our expansion and about our decisions. Because, you know, the next year we’ll be elections year in Mexico, and there will be a lot of uncertainty, both in the markets and in the political realm of things. Also, in the US, you have a similar phenomenon taking place. So we got to be cautious. And I would say cautiously optimistic with the exchange rates and and the markets of exports and imports in Mexico, but at the same time, as you know, Jeff, if we’ve learned anything from aviation is that our business is very cyclical. And the name of the game is playing the long game. So we’re hoping for the best but at the same time, we’re preparing for the worst. And that’s why we have been so cautious in our decisions and in our incorporation of aircraft into our fleet, because we want to make sure that we’re going to be able to give these aircraft the utilization that they require.

Jeff Lee
Right. Well, that’s very exciting. And good luck with all your certification flights, and your AOC and the expansion of your fleet. And we’ll look forward to seeing that. And hopefully we’ll see you at cargo facts symposium next month.

Luis Ramos
Thank you, Jeff. Yeah, no, I’m very excited. That’s San Diego. We certainly have it on the calendar. We don’t know if I will be able to attend because it’s the same dates as the Formula One. And we’re actually handling the Formula One in Mexico this year as we have for the last seven years. So that requires a lot of attention on our end to make sure that Chieko bears can take the trophy this year.

Jeff Lee
We’ll see. Well, thank you so much for your time Luis and catch up with you again soon

Luis Ramos
Thank you Jeff.

Jeff Lee
That was Luis Ramos, founder and CEO of awesome cargo. And that’s it for today. For more multimedia coverage like this search cargo facts connect on iTunes and Spotify and visit cargo facts.com. Thank you very much for tuning in, and join us again next time.