Airlines halt ticket sales in Venezuela
By FABIOLA SANCHEZ
the associated press | January 25,2014
CARACAS, Venezuela — Tempers flared at airline offices in Caracas on Friday as Venezuelans reacted angrily to international carriers’ refusal to sell tickets after the government devalued the bolivar for flights abroad.
The offices of American Airlines, Delta, United and Panama’s Copa were all either closed or had halted sales on Friday as the higher exchange rate took effect, adding to uncertainty as carriers try to collect $3.3 billion they say they’re owed by the socialist government.
“Don’t waste your time,” a United representative, sticking her head out from behind a closed glass door, told a group of 10 waiting customers standing outside a ticket office at Caracas’ Centro Lido shopping mall. “It’s out of our hands. We can’t sell any more tickets.”
When customers protested that they’d never experience such poor service in the U.S., the agent, who didn’t identify herself by name, said “our situation is different than the U.S.” and then quickly closed the door shut.
Megan McCarthy, a spokeswoman for United in Chicago, said the airline continues to sell tickets in Venezuela but acknowledged that they had been halted for a few hours as prices in its system were adjusted. United has a single daily flight between Houston and Caracas.
“When the exchange rate was updated, we had to hold selling them,” she said. “We apologize to our customers who we did not explain this to.”
Gretty Sivira, a 39-year-old teacher, traveled six hours overnight by bus from Barquisimeto to change the date of a flight to Mexico with Copa after trying for two weeks unsuccessfully through her travel agent.
“There’s no solution,” she said with look of helpless worry.
Airlines are also losing patience.
For the past few months they’ve been locked in a battle with President Nicolas Maduro’s cash-strapped government to repatriate $3.3 billion that it says is trapped inside the country by rigid currency controls that are a decade old. The situation worsened this week when the government said that revenue from ticket sales in bolivars would now be converted at a new exchange rate almost twice as high as the official 6.3 bolivar per dollar exchange rate.
Weeks of closed-door meetings have so far failed to produce a deal, with airlines balking at the government’s offer to honor the debt with a combination of bonds, cash and jet fuel, which is cheaper to produce in the oil-rich nation.
On Thursday, United Chief Financial Officer John Rainey said the airline has about $80 million in cash “trapped” in Venezuela while it waits to find out which exchange rate the government will make it use to bring the money back to the U.S. The airline said it works to adjust prices for tickets sold in Venezuela to account for the changes in currency exchange rates.