Aero Latam

Recovery will be slow, but there is hope

The Covid-19 pandemic left the regional aviation devastated, generated an unprecedented economic impact and it is expected that only in 2025 will the number of passengers that existed before this catastrophe be reached again.

 

By Florencia Lucero Heguy

 

From Aero-Latam we spoke with José Ricardo Botelho, Executive Director & CEO of the Latin American and Caribbean Air Transport Association (ALTA). Botelho worked for the last two and a half years as an alternate diplomatic delegate of the Republic of Brazil to the International Civil Aviation Organization (ICAO) and for the last four years he was also president director of the National Civil Aviation Agency of Brazil (ANAC).

He has great in-depth knowledge of the civil aviation in Latin America, developed important projects with civil aviation authorities in the region, and implemented key measures for the progress of air transport in Brazil during his stay at ANAC.

 

 

What numbers do you have regarding the economic impact that the pandemic has already generated on companies?

The impact has been momentous, truly unprecedented, and the effects will last for a while. IATA estimates losses for the region’s airlines of $ 18 billion this year, based on a nearly 50% reduction in air traffic by the end of the year. According to data from the WTTC (World Travel & Tourism Council), more than 7 million jobs are at risk in the travel and tourism sector in Latin America and the Caribbean and the region’s GDP would lose 143 billion dollars from this sector.

The Air Transport Action Group (ATAG) estimates that 46 million jobs are at risk globally due to the loss of connectivity caused by the COVID-19 crisis. Most of these (41.2 million jobs) are in the travel and tourism sector, which relies on aviation. The rest (4.8 million) are direct jobs in aviation, including airports and airlines.

 

How many years do you estimate a recovery can take?

By the end of 2020, it is expected to reach an operation of almost 50% of the capacity originally planned for the year and little by little to recover traffic in the region.

The recovery will be progressive. Let us remember that in 2019 we closed the year with more than 300 million passengers transported in the region. Reaching those traffic levels again will take time, it is estimated that we would see that number of passengers only in 2025. Countries with robust domestic markets, such as Mexico and Brazil, are expected to have a greater and faster recovery, and they also have the advantage of not having ceased operations. Regarding international traffic, markets with ethnic trafficking visiting friends and family, such as Colombia-Spain, Mexico-USA, Brazil-Portugal and Ecuador-Spain, are expected to have a faster recovery.

 

Do you think that this crisis could be an opportunity for smaller companies, which are dedicated to air taxi for example?

Every crisis brings with it an opportunity to reinvent ourselves, to make ourselves more efficient. While we are facing an unprecedented challenge, there is an opportunity for companies around the world.

Our region is particular. We have a vast continental territory with intricate geography that does not have efficient transportation alternatives such as the train or roads to transport safely and efficiently. That is why aviation is key, especially air taxi airlines that generate connectivity with remote places. At ALTA we have the ISSA Program, the objective of which is to facilitate access to smaller airlines to the training necessary to improve their operational safety standards and obtain their ISSA certification. This allows them to subsequently conduct codeshares and help develop the region’s air network.

 

 

Do you think there is a paradigm shift when it comes to regional aviation?

We have been working for some years in the development of regional aviation, especially through the ISSA Program. By improving operational safety, we are managing to improve connectivity. We have already seen it in countries like Brazil, Chile, Colombia, Argentina and even in the Caribbean. There is still enormous potential and I am sure it will be an important driver of the recovery of the industry.

 

What activities are you doing with other entities and / or government authorities?

Mainly, we have been in dialogue with governments so that the protocols recommended by the CART group are implemented in a harmonized way and quarantines are avoided, as this discourages passenger demand and further delays the recovery of our countries.

As we have said, traveling is safe, there are protocols that guarantee biosecurity and their harmonized application throughout the region is key. We are advocating that there are no new closures or new regulations that complicate travel for operators and users.

We recently made a joint call with the International Council of Airports of Latin America and the Caribbean (ACI-LAC), the Civil Air Navigation Services Organization (CANSO) and the International Air Transport Association (IATA) so that employees in the aviation sector are considered essential workers during the vaccination campaign against COVID-19.

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