AMERICA
LATIN Twenty-year growth forecasts for the region’s
main air cargo routes:
put this into context, airports in the region handled more than
4m tonnes of air cargo in 2018; every year, Chile alone exports
more than 500,000 tonnes of fresh fish, while Colombia exports
more than 250,000 tonnes of flowers.
Regional promise
The LAC region is demonstrating itself to be one of both growth
and opportunity, with efforts underway to bolster the region’s
airport infrastructure, large orders to grow and modernise
freighter fleets and a wealth of unrealised potential. South America – The US: 4%
Central America – The US: 4.8%
Caribbean – The US: 1.8%
Sweet spots
For Latin America and the
Caribbean, the US and Europe
are the main trading partners,
continues de Oliveira. Specific
growth forecasts for air cargo
transport on various routes
between these regions over
the next 20 years are provided
(see chart above).
“Currently, almost 90% of
the total air cargo by value is
carried in freighter aircraft and
10% in the belly of passenger
aircraft. Many airlines in the
region have taken advantage
of its extensive network of
passenger routes, drawing on
synergies between passenger
and cargo operations to
develop a strategy to transport
more cargo in the belly of
aircraft,” de Oliveira says.
At present, the weight load
factor (freight tonne kilometres
flown divided by available
freight tonne kilometres) for
the region’s airlines is around
65%, he continues, which
means that there is still more
potential to use the bellies
South America – Europe: 4%
Central America – Europe: 4%
Caribbean – Europe: 3%
of aircraft to transport loads,
taking advantage of the wide
network of routes.
Airport development
Although the New Mexico City
airport project was scrapped
in January, infrastructure
developments are planned or
underway at many other of
the region’s major airports,
including Santiago in Chile
and Lima in Argentina, as well
as a planned new terminal
for Panama, which promises
to considerably bolster the
regional industry.
Panama, having a privileged
geographical position in
the region and an advanced
infrastructure, has potential
to become a large distribution
centre for air cargo traffic in the
future and to take advantage
of positive forecasts for cargo
growth, notes de Oliveira.
“The new free zone
project is a great step in that
direction,” he says. “The air
cargo free zone project puts
Panama in a very competitive
position for trade and cargo transportation in the region. One of
the most important characteristics is that the free zone will be
multi-modal, which will enable the integration of the logistics
chain, including air, land and sea transport, and that gives a great
competitive advantage.”
Passenger traffic growth
De Oliveira reports a positive outlook for passenger growth
in Latin America and the Caribbean, too. In 2018, he says,
the total domestic and international passengers carried by
Latin American and Caribbean airlines grew 5.8%, while
international-only traffic grew 13.3%. “With this, the region
reached the fifteenth consecutive year of growth,” he explains.
“Meanwhile, 64 new routes were inaugurated and 86 aircraft
were delivered. This year started very positively, with first
quarter results demonstrating 5% total growth in passenger
traffic, while domestic traffic grew 6.1%.”
Latin America and the Caribbean is a region of continuous
growth in this area. Airlines of the region have doubled their
traffic every 12 years since 1970 and in the next 20 years the
picture is even better. “The economic growth of the region will
be greater than the global average and greater than consolidated
markets such as North America and Europe,” de Oliveira asserts.
The emerging middle class in the region represents a big
growth potential for the air travel industry, which is growing
at three or four times the growth of GDP. As the wealth of the
region increases, so too does the portion of the population that
can afford to fly. This quota will continue to grow in the future,
particularly with the increasingly significant share of departures
operated by low cost carriers in the Latin America region.
In 20 years, it is hoped that potential travellers and frequent
travellers combined in the region will total more than 500m.
The region’s current aircraft fleet stands at 1,900 in-service
aircraft, with 668 on order and more than 1,000 new generation
aircraft expected to be delivered over the next ten years. Large
aircraft orders and fleet modernisation will support sector growth,
enthuses de Oliveira.
Perishables market
A vast quantity of fresh produce is exported from Latin America
and the Caribbean. Perishable exports from the region are
numerous and voluminous, including flowers from Colombia,
mangoes from Brazil and avocados from Mexico, which is said to
supply around 45% of the international avocado market.
This sector thus represents major business for the region. To
16 August 2019 www.airlogisticsinternational.com
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