The Southern Cone: Aviation in Brazil, Argentina andChile

Season 1, Episode 14 | 22 de octubre de 2025

Brazil: Arturo; Argentina: Fabricio; and Chile: Nicolás

Transcript (Formal English Business Version)

Nicolás (Host): Welcome to Altitude. Fasten your seatbelts — we’re ready for take-off. Let’s talk aviation, seriously. Hello everyone. As you know, we like to innovate, and today we begin a new journey across Latin American skies. We’ll analyze three

countries that together represent nearly one-third of the region’s commercial aviation activity: Brazil, Argentina, and Chile.

These are three stories, three models, yet one common challenge — how to keep flying higher in an increasingly competitive

global environment. Join us in this first episode of our special series “Latin American Aviation,” where we explore the evolution,

opportunities, and challenges of these markets. Fabricio will take us through Argentina, Arturo will cover Brazil, and I’ll provide

an overview of Chile. Arturo, why don’t you start? What’s the current landscape of aviation in Brazil?

Arturo: Thank you, Nico. Good day, everyone. Brazil is a continent in itself — vast, diverse, and vibrant — with an aviation industry that keeps South America connected. In Brazil, flying isn’t a luxury; it’s a necessity. The country’s immense distances, jungles, mountains, and coastline make air transport indispensable. Beyond geography, Brazil is a powerhouse economy — the largest in Latin America and often among the world’s top ten by GDP. That scale directly translates into aviation demand.

According to IATA, Brazil’s air transport industry supports over 246,000 direct jobs and contributes around US $10 billion to GDP. Including indirect effects from tourism, cargo, and services, the total impact multiplies several times over.

Without aviation, Brazil would be a mosaic of disconnected regions. Thanks to air transport, cities like Manaus connect with São Paulo, and travelers from around the world can reach the country without crossing thousands of kilometers of road or jungle. In 2024,

Brazilian airlines carried around 118 million passengers, domestic and international combined, generating roughly US $3.6 billion in market value. Analysts expect the market to double by 2033, growing at about 6% annually. Even with record traffic, domestic seat capacity remains about 9% below its 2015 peak — aircraft are fuller and airlines more efficient, but growth is

conservative. Business aviation is also significant: Brazil has the second-largest corporate jet fleet in the world, after the U.S., with aircraft built by Embraer — a national pride.

Nicolás: Arturo, Brazil’s aviation heritage goes back decades. Who could forget Varig?

Arturo: Indeed. Varig was a legend — Brazil’s flag carrier for decades, founded in 1927. It once symbolized prestige and global reach, with a fleet that included Boeing 747s and MD-11s. By the late 1990s, however, debt, deregulation, and economic crisis led to its collapse. Varig filed for bankruptcy in 2006, leaving a symbolic void later filled in part by Gol; some of its Boeing 777s even ended up with Aeroméxico. Today, Brazil’s skies are dominated by three major players — LATAM Brasil, Gol, and Azul. LATAM, successor to TAM, is the most international and has expanded aggressively.

Gol pioneered the low-cost model in South

America but now faces serious financial headwinds and is restructuring under Chapter 11 in the U.S. Azul, the youngest of the three, built its success by connecting underserved secondary cities, operating one of the world’s most diversified fleets — from Cessna Caravans to A330-900neos — and becoming Latin America’s largest ATR operator. Over the last decade, the market

shifted from fragmentation to concentration: fewer, larger airlines dominate, providing stability but also reducing competition.

São Paulo remains the heart of the system. Financial headwinds persist: dollar-denominated debt, high fuel costs, currency depreciation, uneven infrastructure, and complex regulation. Still, domestic tourism is booming, and the government is considering incentives to expand regional connectivity, especially in the Amazon. Brazil is South America’s aviation engine — rich in scale, talent, and potential. Stabilizing finances and modernizing infrastructure are key to sustaining that climb.

Nicolás: Excellent insights, Arturo — a truly impressive market. Fabricio, let’s move south. Tell us about Argentina.

Fabricio: Argentina’s aviation history dates back to 1910 — one of the earliest in Latin America. Today, it ranks as the third- largest economy in the region and a market of around 30 million passengers annually. For decades, the sector has been marked by heavy state intervention and economic volatility. At the center stands Aerolíneas Argentinas, the state-owned flag carrier, sustained largely by public subsidies and regulatory protection. In contrast, Aeropuertos Argentina 2000, a private consortium founded in 1998, operates 35 airports — including Aeroparque and Ezeiza — and handles over 90% of national traffic.

Liberalization began in 2015 under President Macri, opening the door to new entrants: Norwegian Argentina, Avianca Argentina, Flybondi, and JetSmart. The latter two triggered a 60% surge in domestic demand between 2015 and 2019. Today, Flybondi and JetSmart together control about 45% of the domestic market, while Aerolíneas retains roughly 50%. The peso’s devaluation has spurred inbound tourism and helped the international rebound. The Milei administration is pushing deregulation and broader market openness, although cabotage for foreign carriers remains controversial. Aerolíneas Argentinas faces a decisive crossroads. From 2008 to 2024, it received over US $8 billion in state subsidies. Leadership turnover — six CEOs in ten years — and political interference have hindered strategy. Despite narrow-body renewal (737 MAX 8/9 and E-Jets), long-

haul capacity has contracted. Foreign investor interest (e.g., Abra Group) has been tentative, and 2025 has been signaled as the last year of subsidies. Demand indicators, however, are positive: in early 2025, traffic grew 15% year-on-year; Aeroparque is among the top 10 in Latin America. Major new routes — like China Eastern’s Shanghai–Buenos Aires service via Auckland — and additional Madrid frequencies by Iberia and others point to renewed interest. Still, structural weaknesses persist: fiscal instability, fragmented labor relations, abrupt policy shifts, and regulatory complexity. SkyTeam membership gives Aerolíneas

some international reach, but the outlook remains uncertain.

Arturo: Thank you, Fabricio — a very thorough analysis. Let’s now close today’s journey with Chile.

Nicolás: Chile is a fascinating case — geographically narrow but more than 4,200 kilometers long, from deserts to Patagonian fjords. With limited rail and highway connectivity, aviation is essential infrastructure, not a luxury. Chile is Latin America’s fifth- largest economy, with GDP per capita around US $17,000. Aviation contributes over US $8 billion — roughly 3% of GDP — and generates more than 210,000 jobs. Air travel penetration is the highest in the region — about 1.2 trips per capita annually, triple that of Mexico or Brazil. Over the last decade, the market evolved from a LAN Chile dominance to a competitive ecosystem with LATAM, Sky Airline, and JetSmart. By 2024, LATAM held roughly two-thirds of the domestic market and nearly 80% internationally, increasing passengers by about 11% year-over-year. The group completed Chapter 11 in 2022, reducing

debt by US $10.3 billion and bringing in Delta as a 20% shareholder with a US $1.4 billion investment. Recently, LATAM placed an order for more than 70 Embraer E195-E2s to strengthen regional connectivity and compete with low-cost carriers. LATAM Cargo operates 19 wide-bodies and represents around 15% of group revenue, moving perishables and pharmaceuticals across the Americas. Sky Airline, an all-Airbus NEO operator with 28 aircraft, is expanding regionally into Peru and Argentina. JetSmart, part of Indigo Partners, flies 41 A320-family jets and grew 33% in 2024, targeting 100 aircraft and 100 million passengers by

2032 under CEO Estuardo Ortiz. A new Gol-affiliated airline has been established in Santiago to operate Boeing 737s under a low-cost model. Structurally, the market is highly concentrated (about 95% among three airlines), with high airport charges, limited capacity at Santiago, and incomplete open-skies agreements. Despite these constraints, Chile maintains regulatory

stability, financially solid operators, and a strong air-travel culture — a strategically vital market for Latin America.

Fabricio (closing): Well said, Nico. Three distinct models with shared challenges — regulation, competition, and sustainability.

From global groups like LATAM to emerging low-cost carriers, these markets shape the pulse of Latin American connectivity.

Brazil, Argentina, and Chile continue to evolve and redefine the region’s air transport landscape. In our next episode, we’ll look north — at Colombia, Peru, and Central America — to see how they fit into the broader Latin American aviation map. Follow us on social media and visit altitudeaviationleaders.com.mx for all episodes. Thank you for flying with Altitude — see you on our next flight.