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17 June 2008
17. June 2008 Commercial Aircraft

Strong traffic growth to boost Brazillian passenger aircraft demand


To meet the demand created by traffic growth and the need for replacement aircraft, Airbus' latest Global Market Forecast predicts that Brazilian airlines will acquire more than 330 passenger airliners over the coming 20 years, representing an approximate value of $32 billion.

Airbus foresees that Brazilian airlines will need more than 330 passenger aircraft above 100 seats over the next 20 years to meet demand for traffic growth as well as aircraft replacement. This will represent a value at current list price of US$ 32 billion. Overall demand of new aircraft in Latin America is around 1,450 aircraft.

The Brazilian passenger aircraft fleet of above 100 seats is expected to more than double in the 20 year period, growing from 208 aircraft in service in 2006 to more than 460 by 2026. Taking retirements into account, the new aircraft will include some 250 short haul - single-aisle aircraft, which are currently prominent in the region's fleet, some 80 medium to long-range wide-body aircraft and eight very large aircraft to satisfy strong international travel growth.

The increase in demand for new aircraft is the consequence of the strong passenger traffic growth in Brazil. Since the 1990s, international passenger traffic doubled while domestic traffic risen 77 per cent in the past ten years alone. With a yearly forecast growth of 5.3 per cent for the next 20 years, Latin American travel growth is well above the world average of 4.9 per cent.

This sustained demand for air transport in Brazil is driven by high economic growth, and is forecast to further increase by nearly four per cent per year over the next 20 years. With 31 per cent of all Latin America's GDP, Brazil is the transport focal point for South America and beyond. Strong tourism development, especially from the Americas and Europe, has also strongly contributed to the fivefold increase in international arrivals into the country over the last 15 years. Domestic traffic is driven by concentration of population in large cities and long internal distances.

"Brazil being the major economic player in Latin America, air traffic has grown immensely in this country over the 90s, and will do so with even more amplitude over the next twenty years period. Increase in passenger demand is high, and so is the need for new, efficient aircraft in this competitive and dynamic market. We have already won 61 per cent of the order intake in the past ten years. We expect to become even more present in the future, with the A380, the brand new A350 XWB and the best-selling A320 Family which responds perfectly to market needs", said Rafael Alonso, Senior Vice President Latin America, Spain and Caribbean of Airbus.

Brazilian airlines have already chosen Airbus as the right answer for the demand of their market. In 1999 TAM of Brazil started operating the first of its A330-200s, and now operates with 103 Airbus aircraft the biggest Airbus fleet in the region (71 A320s and 15 A319s, three A321s, 12 A330s and two A340s). The presence of Airbus aircraft in the fleet of the Brazilian flag carrier will further increase in the future. As an important vote of confidence for the partnership with Airbus, TAM signed a firm contract for the purchase of 22 new A350 XWB aircraft, 20 A320 Family aircraft and four A330s at the beginning of 2008.

Furthermore, Airbus has signed important contracts this year with MatlinPatterson, major shareholder of Varig Logistica in Brazil (six A330-200Fs) and Synergy Aerospace, major shareholder of OceanAir (firm contract for ten A330s, 20 A319s/A320s, as well as a Memorandum of Understanding for ten A350 XWBs).

Since 1998, Airbus has taken 63 per cent of the order intake in Latin America to date. Today, 305 Airbus aircraft are flying with 22 Latin American airlines, which represents around 35 per cent of the passenger fleet in service today. By 2010, this figure will have risen to 50 per cent.

Read the feature stories on Airbus' Global Market Forecast for the following countries/regions:

Global Market Forecast for North America
Global Market Forecast for Russia
Global Market Forecast for the Nordic countries
Global Market Forecast for Spain
Global Market Forecast for Mexico
Global Market Forecast for the Chinese Mainland
Global Market Forecast for Argentina
Global Market Forecast for Central Europe
Global Market Forecast for Germany

See the special Airbus website section with the
complete 2007-2026 Global Market Forecast

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