|Study Period:||2018 - 2026|
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The Latin American aviation market was valued at USD 6.2 billion in 2020, and it is projected to reach USD 9.54 billion in 2026 with a CAGR of 5.76% during the forecast period (2021-2026).
The outbreak of COVID-19 in 2020 had a major impact on the aviation industry in Latin America, as the demand for air travel dropped and airlines are forced to cut down their capacity. This has resulted in significant losses for the airlines in the region. However, the demand for domestic travel and cargo movements and the growth of low-cost carriers in the region are acting as major drivers for the revival of the aviation market in Latin America.
Despite the slow-growing economy of the region and the economic impact of the COVID-19 pandemic, countries in Latin America are planning to modernize their military aircraft fleet to strengthen their armed forces. This is expected to drive the military aviation sector in the country during the forecast period.
The privatization of airports in countries, like Brazil, Jamaica, Honduras, Paraguay, and Peru, is expected to develop the airport infrastructure and enhance capacity, thereby supporting the growth of the general aviation market in the region.
Scope of the Report
The Latin American aviation market encompasses the sales of fixed-wing and rotary-wing aircraft across the commercial, military, and general aviation sectors in the Latin American region. The market offers an overview of air passenger traffic, aircraft orders and deliveries, defense spending analysis, the introduction of new routes, and investments by country into the aviation sector in the region. The Latin American aviation market is segmented by type into commercial aircraft, military aircraft, and general aviation. The report also offers the market size of and forecasts for the aviation market in major countries in the region. For each segment, the market size and forecasts are represented in value (USD billion).
|Rest of Latin America|
Key Market Trends
The Commercial Aircraft Segment to Grow with the Highest CAGR During the Forecast Period
The commercial segment of the Latin American aviation market is anticipated to register the highest CAGR during the forecast period. Though the travel restrictions amid the COVID-19 pandemic have affected the revenues of the airlines in the region, Boeing has projected a demand for 2,610 new aircraft in the region over the next two decades. Narrow-body aircraft is expected to comprise 90% of this demand, reflecting the growing demand for affordable air travel across and within the region. Avianca and LATAM Airlines Group, two of the largest full-service carriers in the region, are currently restructuring their fleet and strategies to return to profits. These airlines are also adding back capacity in markets like Brazil and Colombia, which are recovering at a comparatively better pace. In addition, LCCs in some countries in the region are also continuing to add back capacity at a faster rate, which is also expected to drive the market. Though some airlines have decided to defer their aircraft deliveries, much of the aircraft ordered are not canceled. 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, the Argentine government announced plans to invest USD 750 million in the expansion of Ezeiza International Airport. The renovation of the airport may help it accommodate four times the number of aircraft than the current capacity. In Latin America, to boost the number of air passengers, commercial airlines are providing attractive services, like free checked baggage, competitively priced fares, and new routes. In addition, the exponential growth in e-commerce in recent months is also expected to propel the airlines to increase their cargo aircraft fleet, thereby driving the growth of the segment during the forecast period.
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Brazil is Expected to Dominate the Market During the Forecast Period
As of 2020, Brazil had the highest market share in the Latin American aviation market. Brazil is one of the booming markets in the commercial aviation industry globally. The country is also one of the top 15 military spenders in the world. In the past few years, the Army and the Navy of Brazil received funds to replace their 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 planned to run through 2024. As of July 2020, Brazil began manufacturing the jets at its new local facility. The Brazilian Air Force has a total of 28 C-390 Millennium multi-mission medium airlifters on order, of which four aircraft were delivered as of December 2020. In 2020, as a result of the fall in demand and mounting losses for the airlines in the country, airlines had deferred their aircraft orders. In May 2020, Azul Airlines reached an agreement with Embraer to postpone the initial deliveries of 59 Embraer E195-E2s from 2020 to 2024. However, airlines like LATAM Brasil and GOL have a strong order book, which is expected to drive the market. Brazil has a strong domestic demand, which is expected to drive the country's recovery of the aviation industry. In December 2020, GOL Airlines announced that it would resume flying the Boeing 737 MAX in its domestic network. GOL Airlines has orders for 95 737 MAX aircraft to replace its NGs, scheduled for delivery in 2022-2032. To improve the infrastructure for air travel across the country, the Government of Brazil announced its plan to privatize several airports in the country. The ongoing investments in airport infrastructure and the strong domestic and commercial airline demand in the country are propelling the growth of the aviation market in Brazil.
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Some of the prominent players in the Latin American aviation market are Embraer SA, Airbus SE, The Boeing Company, Bombardier Inc., and Lockheed Martin Corporation. After the cancellation of the planned purchase of Embraer’s commercial aircraft to Boeing, Embraer announced in November 2020 that it would not sell its commercial aircraft division. Also, the cancellation of another joint venture for KC-390 military tactical airlifter resulted in Embraer losing the sales network of Boeing and a potential entry point into the US military market. However, the company is looking for partners on aircraft programs. The aviation market in Latin America has huge potential for growth and can provide huge opportunities for aviation industry players to expand their presence during the forecast period.
In February 2021, the Brazilian startup ITA Transportes Aéreos received its first aircraft, an Airbus A320-232, ahead of its launch in March 2021. This aircraft was the first of ten that ITA Transportes Aéreos used as its starting fleet.
In November 2020, the Colombian Air Force ordered four Cessna Skyhawk 172 piston singles from Textron Aviation, replacing the service’s long-in-tooth Cessna T-41 Mescaleros. The Skyhawks will be used for initial training and are expected to enter service in 2021.
In July 2020, the Brazilian Navy received the second UH-17 aircraft in the 1st General Employment Helicopter Squadron (HU-1). Earlier, the Brazilian Navy received the first unit from the Airbus subsidiary Helibras in February 2020.
Table of Contents
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Porter's Five Forces Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION (Market Size by Value - USD billion)
5.1.1 Commerical Aircraft
5.1.2 Military Aircraft
5.1.3 General Aviation
5.2.4 Rest of Latin America
6. COMPETITIVE LANDSCAPE
6.1 Company Profiles
6.1.1 Textron Inc.
6.1.2 Embraer SA
6.1.3 Bombardier Inc.
6.1.4 Airbus SE
6.1.5 The Boeing Company
6.1.6 Dassault Aviation
6.1.7 Lockheed Martin Corporation
6.1.8 Leonardo SpA
6.1.9 Saab AB
6.1.10 Honda Aircraft Company
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
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Frequently Asked Questions
What is the study period of this market?
The Latin America Aviation Market market is studied from 2018 - 2026.
What is the growth rate of Latin America Aviation Market?
The Latin America Aviation Market is growing at a CAGR of 5.76% over the next 5 years.
What is Latin America Aviation Market size in 2018?
The Latin America Aviation Market is valued at 6 Billion USD in 2018.
What is Latin America Aviation Market size in 2026?
The Latin America Aviation Market is valued at 9 Billion USD in 2026.
Who are the key players in Latin America Aviation Market?
Embraer SA, Airbus SE, Boeing Company, Lockheed Martin Corporation, Bombardier Inc. are the major companies operating in Latin America Aviation Market.