DUBLIN–(BUSINESS WIRE)–The “Latin America Air Freight Industry – Growth, Trends, COVID-19 Impact, and Forecasts (2022 – 2027)” report has been added to ResearchAndMarkets.com’s offering.
The Latin American air freight industry is expected to exhibit a CAGR of over 3% during the forecast period. Commercial air transport of cargo in the Latin American region has undergone enormous changes in the recent decade, owing to the exponential consolidation of the low-cost airline model and ever more demanding safety and environmental requirements. The substantial growth in the market has put enormous pressure on airport infrastructure, making operations more complex and requiring greater investment in both physical and technological infrastructure to optimize its use and provide suitable services for passengers and cargo.
The air trade in Latin America is growing with new capacity introduction and demand for fresh Latin American perishable goods from across the world. However, the archaic regulations and slow growth in infrastructure are hindering the continent from realizing its full potential. Economic instability coupled with widely divergent travel restrictions, newly imposed taxes, and a lack of government financial aid will make for a rather uneven recovery from the downturn driven by the COVID-19 pandemic.
While Central and South America made significant progress in improving the processes and infrastructure in and around airports, much more work must be done. Latin America’s regulatory environment is multifaceted and outdated, deterring the rapid clearance of cargo. Many countries still require signatures, stamps, and associated fees on export shipments. A fragmented logistics chain with delays, infrastructure constraints, inadequate ground services, complex customs processes, and regulatory restrictions are the main challenges that increase transit time and create inefficiencies in the supply chain. This under-investment into the infrastructure and digitization by many stakeholders, including customs authorities throughout the region, causes the entire supply chain to suffer.
Key Market Trends
Growth of E-commerce is Driving the Air Freight Market
As per a recent report by DHL, cross-border e-commerce is one of the major opportunities for logistics providers due to the lower density of physical retail space, limited product availability, high penetration of smartphones, and purchase savings throughout the region. The industry is continuously innovating to leverage the latest technologies and develop fraud protection solutions and authentication technologies that allow key players, merchants, and banks, to ensure online shoppers are who they say they are by leveraging solutions including biometric data for identity authentication. Several factors are behind this growth, and the two most important are the large numbers of millennials coming of age and making purchases, along with the massive proliferation of smartphones.
Retailers are partnering with delivery platforms to cover demand. In Chile, a passenger transportation firm is seeking to partner with supermarkets, as airport taxi services accounted for over 40% of revenues that have dried up.
Steps toward greater trade assimilation include the United States, Mexico, and Canada (USMCA) and the EU-Mercosur agreements signed in 2020. Both could have substantial positive effects on the growth of e-commerce, the demand for faster deliveries, and boost the air freight market.
Brazil Evolving as an Important Market for the Growth in the Air Freight Industry
Brazil’s assistance of air cargo through its customs and borders regulations ranks 52nd out of 135 countries in terms of the E-freight Friendliness Index (EFFI) globally. The air cargo transportation market has grown considerably in the country due to its various benefits, such as greater speed and safety in the movement of products inside and outside the country.
Factors including the generation of new businesses through bilateral agreements, the growth of the international market, and the arrival of new investments and technological innovations, in addition to the greater use of the modal by some segments of the industry, were the main supporters and drivers of the market growth.
In parallel, another factor that should attract even more attention from major international players to the country is the auction of national airports. With the concessions, new investments will be made, bringing more competitiveness and modernity to the sector. In June 2019, President Jair Bolsonaro approved a bill that restricts strict regulations on foreign air carriers in the country. This bill now allows completely foreign airlines to operate domestic flights. This bill breaks the control of over 92% of domestic air travel in the country by the three main airlines. This decision is a crucial enabler for foreign airlines wishing to operate in Latin America’s largest economy.
Key Topics Covered:
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS AND INSIGHTS
5 MARKET SEGMENTATION
6 COMPETITIVE LANDSCAPE
7 KEY VENDORS AND SUPPLIERS
8 FUTURE OF THE MARKET
- FedEx (Federal Express)
- United Parcel Service
- Emirates Skycargo
- LATAM Cargo
- Qatar Airways
- Azul Cargo Express
- Kuehne + Nagel
- IAG Cargo
- Avianca Cargo
- United Airlines
- American Airlines
- Delta Airlines
- Copa Airlines*
For more information about this report visit https://www.researchandmarkets.com/r/km4wis
Laura Wood, Senior Press Manager
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