Tue, Aug 03, 2010
Third Largest Market For Corporate Aircraft Is South Of The
Border
Latin American countries from Mexico to Argentina are poised
to play an important part in general aviation's economic
recuperation, according to aviation consultant Brian Foley
(pictured).
"Latin America has historically been the third largest market
for corporate-type aircraft," Foley noted. Worldwide, there
are some 30,600 private business jets and turboprops with 62% based
in the U.S. and Canada, followed by 13% in Europe and a surprising
12% in Latin America. In terms of fleet composition,
jets outnumber turboprops by two to one in North America and
Europe. In Latin America, with its often challenging airport
environment, the utilitarian turboprops have a slight edge.
"But what the world is watching now is market activity," Foley
said, "and this is another area where Latin America will likely
shine. Europe's debt crisis and the lagging U.S. economy have
made those aviation markets very sluggish. Latin America,
being relatively insulated from these difficulties, should later
prove to have been a bright spot in the overall recovery."
Foley says the confidence is in part based on regional
stock-market performance, one of several indicators of general
aviation health. For now, the São Paulo stock exchange
is running at only 15% below its all-time high set in
2008. For comparison, the U.S. Dow Jones Industrial
Average is nearly twice as far off peak (29%), and the European
markets are off by almost three times that amount
(43%). This is vitally important, Foley points
out. "Healthy stock markets mean that corporate profits and
personal portfolios are strengthening, providing not only the means
but more importantly the confidence to purchase aircraft."
While it's natural for aviation companies to seek opportunities
in fast-growing Asia, Foley advises them not to turn their backs on
traditional markets like Latin America. "Bear in mind that
any growth in China, India and the Middle East, no matter how
spectacular, builds on a tiny base representing only 5% of all the
world's business aircraft. The Latin American market is
already more than twice that size."
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