Direct flights from South America to Asia remain further out on the horizon

Although demand between Latin America and Asia continues to grow, direct air service from South America to Asia is not likely to materialise in the near future.


Summary:

  • Although demand between Latin America and Asia continues to grow, direct air service from South America to Asia is not likely to materialise in the near future;
  • Presently, the only nonstop flights from Latin America to Asia are Aeromexico and ANA’s daily flights from Mexico City to Tokyo Narita and Aeromexico to Shanghai and Seoul;
  • At recent CAPA Latin American Aviation & LCC Summit Iberia VP revealed traffic flow between Asia and Latin America through Europe is growing;
  • Iberia is working to improve schedules to support demand, but its hubs are currently set up to feed long haul traffic to and from short haul flights.

Presently, the only nonstop flights from Latin America to Asia are Aeromexico’s and ANA’s daily flights from Mexico City Juarez to Tokyo Narita operated with Boeing 787-8 widebodies, plus Aeromexico services to Shanghai and Seoul. Hainan Airlines also operates three weekly flights from Beijing to Mexico City with a stopover in Tijuana.

But flow traffic from Asia to Latin America through Europe is growing, said Iberia VP network planning and alliances Neil Chernoff at the recent CAPA – Centre for Aviation Latin American Aviation & LCC Summit.

After an 18 year hiatus Iberia returned to Japan in 2016 with three weekly flights from its hub in Madrid to Tokyo Narita, and the airline plans to increase its frequency to five weekly flights in the winter of 2019. Iberia also inaugurated three weekly flights from Madrid to Beijing.

Mr Chernoff explained Iberia is starting to see connecting traffic from its Asia markets to Latin America increase, particularly to markets that tend to be a little less connected, including Chile and Peru.

But there are challenges in maximising schedules for that connectivity, he explained. Iberia’s hubs are set up to feed long haul traffic into shorter haul sectors, and in some instances the connection times for Latin American markets from Asia can reach five hours.

The airline has had conversations internally regarding the costs of improving those connection times versus “what you may lose in connectivity to Europe,” Mr Chernoff stated.

Boeing also believes demand from Latin America to Asia continues to grow, but gauging demand on a city pair basis becomes a bit more challenging. Joining Mr Chernoff in the discussion was Boeing managing director of marketing, James McBride. He remarked that flight time on a Lima-Tokyo flight would reach roughly 19 hours, “but it can be done”, he stated, citing Singapore Airlines’ upcoming 19 hour flight from Singapore to Newark as an example.

Longer routes like Singapore to Newark are typically operated with aircraft featuring a lower seat count with a focus on premium traffic, said Mr McBride, adding Singapore to the New York area is likely largely an O&D market. Singapore Airlines is operating its Newark route with a 161 seat Airbus A350-900ULR.

For a potential Lima-Tokyo route,  “you might want to take advantage of the network on both sides to aggregate demand,” said Mr McBride; however, he noted that strategy may not “lend itself to a lot of premium traffic”.

Investment from Asia to Latin America continues to grow, particularly from China to Brazil, which could eventually create enough demand to justify long haul routes from South America to China.

Mr McBride stated some of that investment is becoming more varied, with higher levels dedicated to banking, ports and infrastructure. Additionally, that investment is not just focused trade flows, but also technology transfers and the creation of joint ventures, and those “types of things lend themselves to more air travel”, he explained.

Even as trends are moving in the right direction for direct links from South America to Asia,  it could still take some time for demand to reach the optimal levels to justify the launch of service. But the upside is it’s not question of if, but when direct links in two of the world’s fastest growing air traffic markets debut.

CHART – Since early 2017 available nonstop capacity between Latin America and North East Asia has grown, but will we see additional flights added in the future?Source: CAPA – Centre for Aviation and OAG