Airlines to face challenging 2022
The vastness of the Brazilian territory and the lack of road and rail infrastructure make aviation a central piece for connecting the country. The industry, however, will face challenges to grow again at a strong pace as it did between 2002 and 2012, when the volume of passengers transported jumped to 88 million from 30 million - in 2014, it peaked at 95.8 million. In 2019, before the pandemic, the number was at 95 million, but sanitary restrictions caused by Covid-19 reduced the volume to 62.6 million in 2021.According to experts, a new leap depends on economic development and a population who can afford flying. In addition, there are regulatory challenges to be overcome, such as high taxation on aviation kerosene and legal insecurity.The Brazilian market is the fifth-largest in the world in number of passengers, but is little explored, said Juliano Noman, head of the National Civil Aviation Agency (Anac). "Air transport is popular [considering the size of the market], but not universal. In Brazil, today, those in the A and B classes are the only ones flying," he said. "The great factors for the sector’s growth are GDP growth, cheaper fares, which is very important for us, since the Brazilians’ income is not high, and having conditions to draw more companies," Mr. Noman said.In 2019, before the impacts of the pandemic on the industry, Brazilians flew 0.48 time a year, compared to 1.23 in Chile, for example. In the United States, people fly 2.6 times a year, data from the International Air Transport Association (IATA) show.The sector’s biggest challenge is associated with the drop in the Brazilian income. "Today we have more airport infrastructure than before. But these are airports to meet a demand that could exist but doesn’t," said Marcus Quintella, head of the research center FGV Transportes.Within the efforts to expand access to air transport, Mr. Noman said, it is up to ANAC to simplify rules and make the market more competitive with measures to ease imports of aircraft and parts, as well as the registration and start-up of aircraft. These points have been addressed by the regulator in programs such as Voo Simples (Simple Flight).Another window to expand the consumer market for air transport is to tackle the cost of aviation, said Eduardo Sanovicz, head of the Brazilian Airline Association (Abear). "We have important regulatory issues to overcome."The formation of the price of aviation fuel - which rose 48% this year, according to...
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