Is infrastructure the only obstacle for aviation in Latin America?

For the past 10 years the aviation industry in Latin America has been subject to impressive growth rates. In September alone local airlines recorded an increase of approximately 8% in demand for air travels. Nevertheless, experts claim that currently the region is performing weaker than it should due to various infrastructure related challenges. However, if these issues were eliminated, would Latin America be truly ready to meet the ever growing demand?

During the last few years, Latin America’s performance in the aviation industry has been more than satisfactory.  In Brazil alone the total domestic RPKs have nearly doubled from 44 million in 2007 to 87 billion in 2012. According to various sources, over the next 10 years air traffic in the region is expected to increase by an average of 7% annually, which would put Latin America on about the same growth trajectory as China. Nevertheless, according to IATA, currently the Middle Eastern airlines are carrying two times more passengers than the ones in Latin America, despite the considerably smaller market. The common opinion is that one of the main obstacles for further growth of commercial aviation in Latin America is the lack of adequate aviation infrastructure.

“Considering the pace of global aviation recovery, further investment in the infrastructure is of particular importance to such regions as China, Northeast and Southeast Asia, India and Latin America, where the aviation growth is simply outpacing the planned infrastructure development,” says Kestutis Volungevicius, the Head of FL Technics Training. “The changes in the segment strongly rely on the attitude of the local governments. We are talking about major investments into large capital projects, including new runways, terminal expansions and entirely new airports.  However, the relevant authorities in the region have to ask themselves if the industry is really prepared to meet the growth which will follow.”

It’s understandable that the growth expressed in traffic figures implies the respective growth of the fleet. According to various forecasts, in the upcoming 20 years Latin American airlines will require up to 2900 new aircraft. Thus, until 2032, the regional fleet is expected to grow from 1,280 to more than 3,700 airplanes, which means that up to 85% of aircraft in the region will be new. Moreover, since 2003 the average age of an airplane in the continent has dropped from 14.8 to 9.7 years, making the Latin American fleet younger than the ones in the United States and Europe.

“Unfortunately, many profit-driven carriers tend to overlook the fact that such a fleet needs appropriate technical attention. Moreover, the region lacks proper base of technicians to deliver appropriate fleet support,” shares the Head of FL Technics Training. “We also have to take into account that a large share of the aircraft delivered to the region will be new generation aircraft, the maintenance of which relies on new technologies, materials and inspection approaches, so even hiring some of the current generation of technicians from abroad may not be enough, as they will need proper retraining. Thus, developing the adequate MRO capabilities in the situation of the global human labour deficiency should in fact become the top priority. Otherwise, further growth might prove a too tough cookie to crack.”