Could Mexico Be Downgraded to Category 2 Again? The FAA, AFAC, and What Is Really at Stake
Season 2, Episode 16 | September 2nd, 2026
EXECUTIVE SUMMARY
The FAA completed an International Aviation Safety Assessment (IASA) of Mexico’s Federal Civil Aviation Agency (AFAC) from August 10–14, 2026, with a final report expected in approximately 60 days. The assessment evaluates AFAC’s ability to regulate, certify, and oversee Mexico’s aviation industry—not the safety performance of individual Mexican airlines. A Category 2 downgrade is possible but not predetermined. If it occurred, existing US services could generally continue, but Mexican carriers would face significant restrictions on new routes, expansion, operational changes, and new codeshare arrangements. Compared with the 2021 downgrade, Mexico’s legal framework has already been substantially updated; if current findings primarily involve staffing, training, funding, and oversight execution, corrective action may be more directly within the government’s control. The decisive issue is whether AFAC can present concrete, funded, verifiable corrective measures rather than promises.
Approx. 40–45 minutes.
INTRODUCTION
NICO
Welcome to Altitude. Today we are going to discuss a topic we will likely hear a great deal about over the next several weeks: the possibility that Mexico could once again lose its Category 1 aviation safety rating with the United States. A couple of weeks ago, the FAA completed an assessment of Mexico’s Federal Civil Aviation Agency, known as AFAC.
Now a waiting period begins that could last approximately 60 days. But before we begin, Arturo, I think there is one question many people are probably asking: Is Mexico once again on the verge of failing an aviation safety assessment?
ARTURO
The short answer is: not necessarily. And I think that is precisely the first point we need to clarify. What the FAA has just completed is not an audit to determine whether Aeromexico, Volaris, Viva, or Mexico’s other airlines are safe. Nor does it mean that US inspectors came to determine whether our pilots fly properly, whether aircraft are correctly maintained, or whether a specific airline operates safely.
The assessment is about something else. What the United States is evaluating is whether Mexico’s aviation authority has sufficient capacity to properly regulate, certify, and oversee the industry under its responsibility. That distinction is fundamental. The FAA itself states that the IASA program focuses on a country’s and its civil aviation authority’s ability to comply with international standards—not on the performance of an individual airline.
SEGMENT 1 — FIRST, LET’S CLARIFY TWO ACRONYMS: IASA AND IOSA
NICO
Because this is where the acronyms immediately begin. IASA, IOSA... And I think they are sometimes confused even within the industry itself. What exactly took place last week?
ARTURO
The FAA conducted an IASA assessment. IASA stands for International Aviation Safety Assessment. It is a program of the US Federal Aviation Administration through which the agency evaluates the capabilities of civil aviation authorities in countries whose airlines fly to the United States or have codeshare agreements with US airlines.
In our case, the authority being assessed is AFAC. And there is another very similar acronym: IOSA. IOSA stands for IATA Operational Safety Audit, and that is an audit focused primarily on an airline. IOSA examines an operator’s operational management and control systems, including flight operations, maintenance, dispatch, ground operations, and safety management, among many other areas.
So we can simplify it this way: IASA asks whether the government knows how to oversee its airlines. IOSA asks whether an airline has appropriate systems to operate safely. They are two completely different things.
NICO
So the assessment that just took place in Mexico was not an IOSA audit.
ARTURO
No. It was an FAA IASA assessment of Mexico’s civil aviation authority. And I think it is worth being very precise about this because we will probably hear the two terms used interchangeably over the next several weeks.
SEGMENT 2 — WHY CAN THE UNITED STATES ASSESS MEXICO?
NICO
Now comes a question I find interesting. Why does the United States have the right to come to Mexico and judge whether our aviation authority is doing its job well or poorly?
ARTURO
That is an excellent question, because it might appear that we are allowing another country to grade a Mexican government agency. But the rationale is different. Mexico is a contracting state to the Chicago Convention and participates in the international civil aviation system led by ICAO.
Countries commit to meeting a set of international standards so that an aircraft can leave one country and operate with confidence in another country’s territory. The United States, for its part, has both the right and the obligation to determine the conditions under which foreign airlines may operate into its territory. And rather than inventing its own standards to evaluate Mexico, the FAA relies primarily on the international standards established by ICAO.
Specifically, the IASA program focuses on matters related to Annex 1, Personnel Licensing; Annex 6, Operation of Aircraft; and Annex 8, Airworthiness of Aircraft. The FAA program is also grounded in the Chicago Convention and bilateral air transport agreements. In other words, the United States is not saying: “Mexico must comply with US rules.”
What it is saying is: “If your airlines are going to operate into my territory, I need to verify that your authority oversees them in accordance with the international standards both countries have accepted.” That is an important distinction.
SEGMENT 3 — WHAT EXACTLY DOES THE FAA REVIEW?
NICO
Let’s turn, then, to last week’s visit. What were the FAA inspectors looking for inside AFAC?
ARTURO
We can simplify this considerably for our listeners. A civil aviation authority has three basic responsibilities: regulate, certify, and oversee. First, regulate. There must be adequate aviation legislation, regulations, standards, procedures, and technical provisions to properly govern the activity.
Second, certify. Writing rules is not enough. Before granting permission to operate, the authority must ensure that an airline, pilot, maintenance facility, training center, or any other organization requiring authorization actually meets the applicable requirements.
And third, oversee. Once I have issued you a certificate, I cannot simply say: “Perfect. See you in ten years.” I must continuously verify that you remain in compliance with the conditions under which you were certified. That includes inspections, verifications, audits, follow-up on findings, and corrective actions.
NICO
In other words, obtaining the license is one thing; continuing to deserve it is another.
ARTURO
Exactly. Technically, however, the FAA goes even deeper.
IASA examines eight critical elements established by ICAO: primary aviation legislation; specific operating regulations; the state civil aviation system and safety oversight functions; qualified technical personnel; technical guidance and tools; licensing and certification obligations; ongoing surveillance obligations; and, finally, the authority’s ability to resolve the safety concerns it identifies.
And there is one point here that I consider particularly important. An authority can have an excellent law on paper. But if it does not have enough inspectors, if they are not properly trained, if they lack tools, funding, or procedures, or if the authority identifies noncompliance but then fails to correct it, the oversight system is not functioning properly.
IASA is specifically designed to determine whether the system works in practice.
SEGMENT 4 — WHAT HAPPENED IN AUGUST 2026?
NICO
Now let’s turn to what just happened. What do we officially know about this assessment?
ARTURO
We know that the FAA conducted the IASA assessment in Mexico from August 10 through August 14, 2026. AFAC reported that it responded to the auditors’ questions and provided the requested technical evidence.
The on-site portion has now concluded. The FAA team now returns home, analyzes the information, consolidates its findings, and prepares its report. AFAC publicly stated that it expects to receive the final report within approximately 60 days.
NICO
And within those 60 days, is everything already decided?
ARTURO
Not necessarily. The IASA process itself provides for final discussions between the FAA and the assessed authority when there are indications of noncompliance. This gives the authority an opportunity to explain what it will do, present corrective actions, and provide additional information that may address the findings.
FAA documentation specifically provides for these “final discussions” so the authority can present the actions needed to correct instances of noncompliance identified during the assessment. That is why it would be irresponsible to claim today that Mexico will lose Category 1. But it would also be irresponsible to claim that Category 1 is guaranteed.
SEGMENT 5 — HOW CONCERNING IS THE SITUATION?
NICO
And here comes perhaps the question we are all asking. Based on this assessment and what you have heard within the industry, what do you think? Will Mexico retain Category 1, or is there a real risk of returning to Category 2?
ARTURO
I would be very cautious because, as of today, we do not officially know the FAA’s final findings. What I can say is that, based on conversations I have had with people close to the industry, there are currently two very different views. Some believe AFAC will be able to respond satisfactorily to the questions and retain Category 1.
Others believe the problems identified could be significant enough to trigger another downgrade. Personally, I would say the outcome is still up in the air. But one element strikes me as very important and makes today’s situation substantially different from what we experienced five years ago.
NICO
Why? What is different now?
ARTURO
First, let’s recall the timeline. The FAA’s previous assessment began in October 2020, continued through the first months of 2021, and ultimately led Mexico to lose Category 1 on May 25, 2021. At that time, among other problems, there was a significant gap between Mexico’s regulatory framework and certain ICAO standards and recommended practices.
That created an additional problem for AFAC. A civil aviation authority can correct a procedure, train an inspector, revise a manual, or reorganize a particular department. But AFAC cannot amend a law on its own. When resolving a finding requires an amendment to the Civil Aviation Law, a legislative process is unavoidable.
The amendments must be drafted, introduced, debated, and approved by Congress, and then officially published. Those timelines are no longer entirely under the aviation authority’s control. In fact, during that process Mexico had to reform its Civil Aviation Law specifically to address some of the findings from the FAA assessment.
NICO
And does that problem no longer exist today?
ARTURO
Based on what we know so far, it does not appear to have the same magnitude. During the previous process, Mexico significantly updated its legal and regulatory framework to align it with the international standards that had been cited.
That means that if—as industry discussion suggests—the main concerns in this new assessment relate to the availability of properly trained technical personnel, resources, funding, and effective oversight capacity, we are facing a different situation. And I want to emphasize the word “if,” because we still do not know the FAA’s final report.
NICO
But if that were the case, would it be easier to resolve?
ARTURO
I would say potentially, yes. Not necessarily easy, but much more within the direct control of the Mexican government and AFAC itself. Hiring or assigning more inspectors, training them, rebuilding technical expertise, allocating sufficient resources, establishing surveillance programs, and demonstrating that those programs are actually being carried out are matters over which the executive branch and the authority itself have far greater control. You do not necessarily have to wait for Congress to amend a law.
That could represent a very important difference from 2021. NICO So does that make you more optimistic? ARTURO It makes me think that, if that is indeed the nature of the findings, AFAC may have better tools to present the FAA with a credible corrective action plan. But we need to be very careful with one word.
This is not about making “promises” to the FAA. It is about presenting concrete, verifiable corrective actions supported by evidence that they can actually be implemented. It is one thing to say: “I’m going to hire more inspectors.” It is quite another to demonstrate: “This is the structure I need, these are the resources that have already been authorized, this is the recruitment and training program, these are the deadlines, and this is how I will demonstrate that oversight is being performed.”
The latter clearly carries far more weight with an authority such as the FAA.
NICO
So if you had to place a bet today... Category 1 or Category 2?
ARTURO
I would not bet today. I truly believe we are in a situation that could go either way. But I do see one important difference from 2021: if the current findings primarily concern institutional capacity, staffing, training, and resources—and do not once again require major legislative changes—then a large part of the solution is much more firmly in Mexico’s hands.
That could work in our favor. AFAC must now demonstrate not only that it knows what needs to be corrected, but also that it has the resources, people, and capacity to do it. Ultimately, the FAA will determine whether that response is sufficient for Mexico to retain Category 1.
SEGMENT 6 — WHAT DO CATEGORY 1 AND CATEGORY 2 MEAN?
NICO
Let’s assume the worst-case scenario. What does it mean for Mexico to be downgraded to Category 2?
ARTURO
Category 1 means that, from the FAA’s perspective, the country’s civil aviation authority meets ICAO’s international safety oversight standards. Category 2 means the FAA has determined that the authority does not provide safety oversight in accordance with those standards. And notice again the subject of the sentence: the authority. It does not say: “That country’s airlines are unsafe.” It says: “That country’s authority has not demonstrated sufficient capacity to oversee its airlines in accordance with international standards.”
That is an enormous difference.
NICO
So if Mexico were placed in Category 2 tomorrow, would Mexican airline aircraft no longer be allowed to fly to the United States?
ARTURO
No. And this is another major misconception. When a country with existing US service is downgraded to Category 2, its airlines may continue operating the services they already had. What is primarily restricted is their ability to expand. They cannot freely launch new service to the United States, increase certain operations, or make certain changes.
Restrictions also apply to new codeshare agreements with US airlines. In addition, those operations become subject to heightened FAA surveillance. That can be very costly from a commercial standpoint.
SEGMENT 7 — THE IMPACT ON MEXICAN AIRLINES
NICO
So perhaps the word “safety” distracts us somewhat from the economic impact.
ARTURO
Exactly. Category 2 can quickly become a competitive problem. Imagine a Mexican airline identifies an excellent opportunity to launch a new route to the United States. Its US competitor can take advantage of the demand.
The Mexican airline may be unable to expand as long as the country remains in Category 2. Commercial agreements and codeshares can also be affected. And this takes on special significance in Mexico because the United States is, by far, our most important international market.
When Mexico regained Category 1 in September 2023, the FAA expressly stated that Mexican airlines could once again add new US services and routes, and that US airlines could again market flights operated by Mexican carriers under their own codes.
We can therefore easily infer what happens when Category 1 is lost: those opportunities become restricted again.
SEGMENT 8 — CATEGORY 2 DOES NOT MEAN FLYING IN MEXICO IS UNSAFE
NICO
I want to come back to this because it would probably become the next day’s headline: “Mexico Fails Aviation Safety Assessment.” What would you say to someone who has a ticket to fly tomorrow and hears that?
ARTURO
Do not confuse the issues. A potential Category 2 rating is not a declaration that Mexican airlines are unsafe. The FAA states this clearly in its description of IASA: the program assesses the country’s capacity, not the individual capability of each airline. And there is something else passengers normally do not see.
Airlines are continuously subject to multiple layers of oversight. Of course, there is their own national authority, AFAC. But when a Mexican airline flies to the United States, it is also subject to the requirements and surveillance applicable to foreign operators. When it flies to Europe, it may undergo ramp inspections under the European SAFA program.
The United Kingdom likewise has its own foreign aircraft inspection program. And then there is IOSA, IATA’s operational safety audit. IOSA examines airlines’ own operational management and control systems and is an internationally recognized industry standard. So there are many layers.
That is why it would be incorrect to conclude: “If AFAC receives Category 2, Mexican aircraft are no longer safe.” That is not how it works.
SEGMENT 9 — THIS HAS HAPPENED BEFORE
NICO
And this would not be the first time.
ARTURO
No. Mexico already knows very well what it means to lose Category 1. The most recent experience began in May 2021, when the FAA downgraded Mexico after determining that our authority did not fully comply with ICAO’s international standards. It took us more than two years to regain it.
Category 1 was restored in September 2023 after a very intensive effort by AFAC and the FAA, including US technical assistance. Mexico had also experienced a temporary downgrade around 2010. So this is not a theoretical scenario. We know what the consequences can be. And we also know something even more important: regaining a lost category is generally much harder than retaining it.
CLOSING
NICO
So we have an interesting couple of months ahead of us.
ARTURO
Yes. And I think we should avoid two extremes. One would be to minimize the assessment and say: “Nothing is happening.” Something is happening. It would be a serious matter if the country’s principal civil aviation authority were found unable to demonstrate full compliance with international standards. But the other extreme would be equally wrong: “Mexico has failed on aviation safety, and our airlines are unsafe.” That is not true either.
What is being evaluated is the Mexican state’s institutional capacity to properly oversee its aviation industry. And to me, that is the real issue. A strong industry needs strong airlines, good pilots, good technicians, and sound safety systems. But it also needs something we sometimes forget: a strong authority. An authority with technical independence. With enough inspectors. With qualified personnel. With resources. With procedures. With the capacity to certify. With the capacity to oversee.
And, above all, with the capacity to identify a problem and ensure that it is corrected. That, ultimately, is what the FAA has just come to assess.
NICO
And in approximately 60 days, we will know its conclusion.
ARTURO
Exactly. And when the result arrives—whether Category 1 or Category 2—we will certainly have material for another episode of Altitude.
Nico, on a separate note, did you see the news that Delta and Aeromexico won their appeal against the DOT’s decision to terminate their joint venture?
NICO
Very interesting indeed. Delta and Aeromexico achieved an important victory in the United States: the Court of Appeals vacated the Department of Transportation order that sought to terminate their joint venture, calling the decision “arbitrary and capricious.”
The ruling questions the consistency of the DOT’s analysis and, for now, allows both airlines to maintain an alliance that for nearly a decade has expanded connectivity, travel options, and competition between Mexico and the United States. It is good that this matter is no longer being politicized alongside unrelated issues, allowing the industry to operate and offer consumers more travel choices.
ARTURO
Exactly, Nico. Congratulations to Aeromexico and Delta for prevailing and finally putting this major issue behind them. We’ll see you in the next episode.
This is Altitude.
Comments