Market Research Report
Latin America Aviation Market - Growth, Trends, and Forecasts (2020 - 2025)
|Published by||Mordor Intelligence LLP||Product code||937994|
|Published||Content info||70 Pages
Delivery time: 2-3 business days
|Latin America Aviation Market - Growth, Trends, and Forecasts (2020 - 2025)|
|Published: May 1, 2020||Content info: 70 Pages||
The Latin America aviation market is projected to grow with a CAGR of more than 1% during the forecast period.
The Commercial Segment is Expected to Experience the Highest Growth During the Forecast Period
The commercial segment of the Latin America aviation market is anticipated to register the highest CAGR during the forecast period. Though the commercial aviation industry growth in the region is less compared to several regions in the world, the growth of LCCs in the region is expected to drive the market in the years to come. Azul, LATAM, GOL, Volaris, and JetSmart, some of the major airlines operating in the region, currently have huge aircraft order backlogs. In addition to regional airlines, foreign airlines are also expanding into this region. For instance, Norwegian Group launched Norwegian Air Argentina in January 2017 and commenced operations from October 2018 in Argentina. As the passenger traffic is growing, major airports in the region are undergoing renovation projects to increase their passenger and aircraft handling capacities. For instance, in March 2018, the Argentine government announced plans to invest USD 750 million in the expansion of Ezeiza International airport. The renovation of the airport will help it to accommodate four times the number of aircraft that it can handle currently. In Latin America, to boost the number of air passenger commercial airlines are providing attractive services like providing free checked baggage, competitively priced fares and announcing new routes. Many commercial airlines in the region are upgrading their aircraft fleet for instance, in October 2019, Mexican airline Interjet finalized a deal to buy 12 Airbus A220 passenger jets to replace its partly grounded fleet of Sukhoi Superjet regional aircraft. Such developments are expected to drive the Latin American Aviation market.
Currently Brazil Holds the Highest Market Share Among Other Countries in Latin America
As of 2019, Brazil had the highest market share in the Latin American aviation market. Brazil is one of the booming markets in the commercial aviation industry and is also one of the top 15 military spenders in the world. In the past few years, the Army and Navy of Brazil received funds to replace its aging aircraft fleet. Brazil signed a contract with Saab AB to acquire 36 Gripen NG fighter aircraft for the Brazilian Air Force worth USD 5.4 billion. The contract was signed in October 2014, with deliveries to begin by mid of 2019 and run through 2024. Similarly, in September 2019, the local aircraft manufacturer, Embraer, delivered the first of 28 multi-mission airlift KC-390 to the Brazilian Air Force. In the commercial sector, to improve the infrastructure for air travel across the country, the government of Brazil announced its plan to privatize 20 airports recently. Major commercial airlines are investing heavily in the procurement of new aircraft, for instance, the Brazilian commercial airline Azul placed an order of 51 Embraer E-Jet E2 family of aircraft and had received 6 aircraft by the end of 2019. Thus, the ongoing investments in airport infrastructure and the growing emphasis on airline fleet expansion to match the capacity demand are propelling the growth of the aviation market in Brazil.
Some of the prominent players in the Latin America aviation market are Embraer SA, Airbus SE, The Boeing Company, Bombardier Inc., and Lockheed Martin Corporation. The current ongoing talks on the partnership between Embraer and Boeing, under which Boeing plans to take 80% share in Embraer's commercial aircraft portfolio and aftermarket support services may have a positive impact over the aviation market in Latin America. Boeing and Embraer are also in plans to form a second joint venture for the manufacturing of KC-390 military transport aircraft, in which Embraer may hold a 51% stake and Boeing may hold the remaining 49%. These deals are expected to be completed once the regulatory issues are sorted. Such partnerships and joint ventures are expected to make the market more consolidated in the years to come.