From Times Staff and Wire Reports

Mexico's 2 Biggest Airlines in Talks: Mexico's two biggest airlines are discussing ways to increase their ties--short of a merger--and prevent a devastating fare war in the highly competitive market, executives said. Aeromexico and its larger rival, Mexicana de Aviacion, which are participating in separate takeover bids for Houston-based Continental Airlines, began discussions last month, Aeromexico's chief financial officer, Eduardo Garcia, said. The airlines are examining several options, including the creation of a holding company or an investment in Mexicana by Aeromexico, Garcia said. Mexicana is the larger company, with nearly twice the work force and more airplanes than Aeromexico. Both carriers lost money in the first half of 1992--Mexicana lost about $30 million and Aeromexico's deficit was about $6 million.

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