LATAM CEO Believes Demand Will Take Years To Recover

The demand in the air travel industry will take between two and three years to recover, said LATAM Brazil’s president, Jerome Cadier, in a conference with a Brazilian businessperson’s group. This is in line with what other airline executives have said in the last few weeks. Let’s investigate further.

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Air travel demand will take up to three years to recover. Photo: Getty Images.

The next three years will be of recovery

“We hope that the demand retakes its pre-crisis levels in the next two or three years,” said Cadier. He added that currently, the number of sales is at 10% of what it normally would be.

Last week, Austrian Airlines CEO said pretty much the same. He does not see demand after the COVID-19 pandemic recovering until at least 2023.

Another CEO of the LATAM family has also talked about the subject. Santiago Álvarez, LATAM Airlines Colombia’s CEO said that the next three to four months will be an all-time low.

He expects that, by December, the airline will have 60 to 70% of the daily operations it had before the COVID-19 crisis. After that, it will take LATAM Colombia a further 12 months to fully recover the demand.

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In April, LATAM will only fly domestically in Brazil and Chile. Photo: Getty Images.

LATAM will not fly internationally in April

The South American carrier suspended all international flights until May due to the coronavirus pandemic, reported MercoPress. LATAM said in a statement,

“Because of the health restrictions imposed by various countries, as well as the continuing fall in demand caused by the COVID-19 pandemic, regular international passenger operations will be suspended from April 13 to 30.”

Domestically, the airline still has some operations. In Brazil, for example, LATAM operates 483 weekly flights. This is possible due to the skeleton operation launched by the Brazilian Civil Aviation Regulator (ANAC) at the end of March.

But the airline stated that the continuation of these domestic flights, both in Brazil and Chile, are subject “to the extent that there is demand.”

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Peter Cerdá of IATA says governments and industry have to work together to bring back the demand. Photo: Daniel Martínez Garbuno/Simple Flying.

IATA doesn’t have an estimate about the demand

Peter Cerdá, IATA’s regional vice president for the Americas, said on a conference call that the organization doesn’t know how long it will take the demand to recover.

He stated that a lot will depend on the Latin American governments. They have the power to help reactivate the industry. This, in turn, will require both parties to synchronize and have economic and health resources to boost confidence in travelers.

“The demand will depend a lot on the confidence of the consumer. We need them to want to go out onto the streets again, go to the airport, get on an airplane and travel again. This will take time,” Peter Cerdá said.  

Additionally, he stated that the demand recovery will not be in the short term. Cerdá remembered that after the 9/11 and other economic downturns such as SARS and 2008, the impact lasted several years. “It will not be different this time. We need a good process with a well-established strategy that gives confidence to the travelers.”

When will the demand recover in Latin America? Let us know in the comments.