Freight Forwarders Assist Ascending Latin American Aeronautics

March 14th, 2018

Booming air travel is fueling Latin America’s growing aeronautical sector, with freight forwarding specialists helping overcome impediments to faster expansion.

Surging aeronautical activity in Latin America is providing sector actors with myriad opportunities, but also stiff challenges in meeting rising demand. To surmount those obstacles as efficiently as possible, businesses in the region’s expanding air travel industry are relying on savvy freight forwarding partners for solutions.

A positive mix of political stability, accompanying economic growth, rising incomes, a widening middle class and use of air travel for both business and tourism has helped fuel the effervescence in Latin American aeronautics.

Carriers transported an estimated 285 million people in the region in 2016, a volume that the International Air Transport Association expects to reach 658 million by 2035. According to Airbus, that Latin American activity will require 2,570 new passenger and cargo aircraft by 2035 to satisfy demand, representing about $350 billion in new plane sales.

That swift maturing of the Latin American market has already permitted the arrival of low cost airlines – a vector of increased competition that observers believe will spread from Colombia, Chile and Peru to other nations. Also burgeoning is attendant maintenance, repair and overhaul services (MRO), with main regional players based in Mexico and El Salvador.

American, Canadian and European plane and parts manufacturers, meanwhile, have established manufacturing sites in Mexico to accommodate production for global demand -- relying on local skilled labor pools to produce quality components at reduced costs and time.

Despite that positive aeronautical spiral, however, regulatory, administrative and infrastructure factors are limiting the speed and efficiency with which businesses can respond to demand across fragmented Latin American markets. Nationally defined customs procedures can be slow, for example, while countries boasting more flexible administrative procedures often lack direct regular air links with regional neighbors.

That complicates the work of rapidly getting parts to Latin American MROs servicing planes – sometimes working in remote locations – from original aircraft equipment manufacturers (OEM) in the US, Europe or Asia. That in turn both slows the region’s aviation supply chain, and reduces its visibility. That results in relatively high degrees of airline losses to planes being grounded awaiting maintenance, and a general braking of aeronautical activity and growth in the region.

“This is why freight forwarders with experience and adapted networks in aeronautics can provide valuable service in avoiding snags, and working quickly around them when they do arise,” says Laurent Chantegros, Aerospace Manager for the Americas for sector specialist Bolloré Logistics. “Clients need a combination of global experience and assets in this activity, as well as local staff familiar with the best solutions to anticipate potential local problems.”

In some cases using Miami as a logistics hub for dispatching parts to Latin American clients proves the most efficient supply option. In others it may require identifying the fastest inner-regional transport alternatives between OEMs and MROs. Either way, constant communication and advanced planning based on maintenance scheduling are vital.

“Airlines are looking for fast, timely solutions at costs their tight budgets permit,” explains David Lefebvre, Bolloré Logistics’ Route Development Manager Latin America. “We provide them all the transport and logistics possibilities, along with the potential customs and administrative factors. That allows them to know exactly when they can rely on delivery according to options chosen, and gives them maximum knowledge, time visibility and cost control of service.”

When regional options won’t work, airlines can be directed towards affordable maintenance solutions in Asia, the Middle East or elsewhere – an alternative freight forwarding partners facilitate by interfacing with OEM suppliers.

“Our long relationships and worldwide experience with manufacturers gives our Latin America customers the assurance we can act as their intermediary, and offer the best on-time solutions and costs,” Mr. Lefebvre says. “That allows us to contribute to further growth on all sides of the sector.”

Key Figures
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    More fuel-efficient for the Boeing 787 and the Airbus A350

  • 70%

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    mega-cities are expected by 2050, with at least 10 million people, compared to 1...

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  • 60%

    of Africa’s population will be urbanized by 2050

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    of growth for Indian GDP in 2014

  • 4,9%

    of growth for African GDP in 2016

  • 6,1%

    of growth for East Asian GDP in 2015, the world’s fastest-growing region

  • 19 224 teus

    transported by the MSC Oscar, the largest container ship in the world

  • 396 m

    is the size of the MSC Oscar ship

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    is the Non-Stop Flight Record done by Solar Impulse

  • 4,5%

    of growth in 2015 for Global Airfreight demand