Mexican airlines will be barred from adding new flights to the United States after the U.S. downgraded its aviation safety rating on Tuesday (May 25).
The U.S. Federal Aviation Administration said it would increase scrutiny of Mexican airlines, but also offered expertise and resources to resolve the issues.
Mexico was the most common international destination for U.S. air travelers last month.
But now the FAA has downgraded it from Category 1, which signifies compliance with international standards, to Category 2, the lowest level.
Mexican President Andres Manuel Lopez Obrador had urged U.S. authorities not to downgrade the country, arguing it was compliant.
The President of the country's Air Transport Chamber, Luis Noriega, says the downgrade means Mexican airlines will not be able to meet growing demand, particularly after the health crisis.
"We are in a process of recovery. Demand is increasing gradually and unfortunately national airlines will not be able to take advantage of this increase in demand. They will be left out of opportunities in air traffic between Mexico and the United States for as long as the category 2 stays in place."
Shares in Mexican airline Aeromexico fell nearly 10% on Tuesday afternoon after the downgrade
The FAA downgraded Mexico for about four months back in 2010.
Only a handful of countries are currently rated Category 2 by the FAA, including Bangladesh, Pakistan, Thailand and Malaysia.