Grupo TACA

Client & Engagement Overview

  • Client is a leading regional airline in Central America with dual hubs in El Salvador and Costa Rica​.
  • A global economic downturn caused a material decline in the airline’s passenger traffic, negatively impacting financial performance​.
  • Prior to the economic downturn, client operated an unprofitable cargo business that was getting worse and generating bigger losses​
  • Client maintained minimal operating cash and was starting to incur losses across all business units​.

Challenges

  • Airline was in the middle of converting its fleet from older Boeing aircraft to newer Airbus aircraft when passenger traffic declined​.
  • Cargo operations become a major drain on cash flow​.

Outcome

  • Immediately deployed on-site resources to develop comprehensive cash flow projections by business unit​
  • Shut down cargo operations and returned aircraft to lessor​.
  • Worked with Airbus to divert near-term aircraft deliveries to other airlines​.
  • Negotiated multi-year financial lease payment reductions with all lessors, offset by lease term extensions to keep lessors whole while preserving cash flow​.