ALTA presents Argentina Aviation Insight: analysis and perspectives of the Argentine air market

This report, based on data provided by the Amadeus Travel Intelligence platform, classifies and analyses the main indicators of aviation demand and capacity in the country, as well as the most prominent airports and city pairs in terms of volume and growth

(Source: Twitter @aa2000oficial)

Argentina's commercial aviation market is expected to see a total demand of 28.6 million passengers in 2023, with the domestic market accounting for 58% of this figure, according to Argentina Aviation Insight, a report prepared by the Latin American and Caribbean Air Transport Association (ALTA) that provides a comprehensive overview of the airline sector in Argentina.

The document reveals that in 2023, total air traffic in Argentina grew by 32% compared to 2022, driven mainly by the international segment, which experienced a rise of 38.2% compared to the previous year.

During 2023, the international market to and from Argentina had a total capacity of 14.3 million seats offered and transported 11.9 million passengers. Airlines from Latin America and the Caribbean accounted for 71% of international capacity, with 10.1 million seats, registering an increase of 40% compared to 2022. Argentina Aviation Insight also highlights that 29 airlines operated in Argentina's international market, covering 74 city pairs with an average distance per flight of 3,568 km.

In contrast, the first half of 2024 presented a mixed outlook, marked by moderate global growth and a notable disparity between the performance of domestic and international markets.

Overall, the Argentine airline industry saw a 2% increase in total passenger traffic compared to 2023. However, this growth masks the reality of a domestic market facing significant challenges, in contrast to a more robust international segment, according to José Ricardo Botelho, executive director and CEO of ALTA.

“Overall, during the first six months of 2024, 7.5 million passengers were transported on domestic flights, representing a decrease of 7.1% compared to the same period in 2023. This decline underlines that, while international traffic contributes to overall growth, the domestic market requires urgent attention to avoid further erosion in its performance,” Botelho explained.

“In response to these challenges, the Argentine government has initiated a series of reforms in its aeronautical policy, with the aim of harmonizing the internal regulatory framework with international standards, especially those of Mercosur countries. These reforms, which include the modernization of the Aeronautical Code and technical regulations by the National Civil Aviation Administration (ANAC), seek to provide the market with the necessary flexibility to improve the competitiveness of the sector,” added Botelho.

(*) Highlights of the Argentine air market

According to the report, Argentina will consolidate itself as the fourth largest aviation market in Latin America in terms of Available Seat Kilometers (ASK) in 2023, representing 6.3% of the region's total capacity. The country recorded a total capacity of 34.3 million seats, of which 58% corresponded to the domestic market.

The Buenos Aires (AEP) - Mendoza route was the most in-demand in the domestic market, with 1.29 million passengers and 1.51 million seats, reaching an occupancy factor of 85%. In addition, this pair of cities also led in passenger growth, with an increase of 341,000 in 2023. For its part, Buenos Aires (AEP) - Córdoba stood out for the largest increase in seat capacity, with 435,000 additional seats. Aeroparque Airport (AEP) registered the largest growth in terms of seat capacity and boarded passengers, with more than 2.5 million seats and 2 million additional passengers compared to 2022.

Argentina has great potential for growth, with a per capita travel rate of 0.58, which has remained stable since 2017. In contrast, the per capita travel rate in the Latin America and Caribbean region is 0.62, having grown by 10% compared to 2017. Countries such as Chile and Colombia have increased their travel rate by 8% and 23%, respectively, since 2017. Furthermore, Argentina ranks 18 out of 20 in the Latin American and Caribbean Air Transport Association (ALTA) Competitiveness Index, indicating ample opportunities for improvement, particularly in areas related to fees, taxes and passenger contributions, as well as in reducing airline operating costs. Improving in these aspects would not only boost the country’s competitiveness in the airline sector, but also facilitate a more favorable environment for air traffic growth.

"This underlines the importance of strategies that boost the development of the Argentine air market, with the aim of increasing air traffic and taking full advantage of the economic benefits of tourism and aviation, both domestically and internationally. Collaboration between the government, airlines and airport operators is essential to capitalise on the country's growth potential and ensure that the Argentine air market contributes significantly to economic development and integration with global growth trends in aviation," Botelho emphasises.

Source: ALTA.


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