CANCUN, MEXICO--Channeling David Letterman’s popular Top 10 list on the Late Night television show, Jonathan Berger, managing director of Alton Aviation Consultancy, created the first Alton’s Annual Top 10 List for Latin America MRO, unveiled at Aviation Week’s MRO Latin America event.
Here are the events he thinks most impacted the Latin American aftermarket.
#10 Copa Airlines was recognized by AOG for being the most punctual airline on the planet in 2018.
#9: Puerto Rico, because more than 3,000 people died after Hurricane Maria, about the same number of people who died in Sept. 11 events in the U.S., and it sustained $90 billion of damage. The island is still is far from recovery and “the community is still suffering,” says Berger. “This is about community and connection,” and keeping the situation on people’s minds, he says. The bleak recovery has prompted 200,000 citizens to leave the island. The U.S. government allocated $20 billion for recovery efforts but has only received $2.5 billion, he adds.
#8: MRO Holdings, which is “probably the largest MRO in Latin America that people haven’t heard of,” says Berger. The company owns Aeroman in El Salvador and Flightstar Aircraft Services in Florida, as well as operates TechOps Mexico, the joint venture between Grupo Aeromexico and Delta Air Lines. Between those facilities, it operates about 65 lines, depending on aircraft type and check. “I expect big things to come out of this company,” says Berger.
#7: The bankruptcy of Avianca Brazil, the one major Latin airline bankruptcy in 2018. The market was challenging, with Brazil’s economic hurdles and the devaluation of the Brazilian real (16.2% less last year versus the U.S. dollar, according to Alton analysis), as well as competition from Latam, Azul and GOL airlines. “There was probably overcapacity,” says Berger.
#6: The new Mexico City Airport 30% completed that was scrapped by Mexico’s new president, Andres Manuel Lopez Obrador, after a public referendum which the Wall Street Journal reports only had 1.2% of registered voters participate. The existing airport is congested and needs updates. Until a new strategy is approved for the city’s airport, it puts the future plans for companies that operate there, such as Aeromexico and Mexicana MRO, on hold.
#5: TAP M&E closed its Porto Alegre facility in Brazil. “This facility used to be the crown jewel of MRO,” says Berger. This big facility formerly was operated by Varig, then VEM, before TAP purchased it, and it performed airframe, engine, component and APU MRO.
#4: Miguel Montoya, senior vice president of engineering and maintenance at Avianca, plans to retire and Jose Luis Quiros Cuevas, who previously held executive positions at Saudia Aerospace Engineering Industries and Iberia, is replacing him. “Miguel has been an active participant (in the aviation MRO community) for 25-plus years” and deserves recognition, says Berger.
#3: In December, Norwegian Air Argentina launched, following Flybondi, a low-cost carrier that started operations last year. Argentina’s economy and currency took a hit last year (the peso’s value dropped 50% to the U.S. dollar, according to Alton), but there is a large population of middle class people in the country who could be potential fliers. The Argentinian government’s past involvement in airlines has been an issue, so “we’ll see how it does,” says Berger.
#2: The largest refugee crisis in the world that hasn’t gotten much media attention: 2-4 million people have left Venezuela, says Berger, and “Colombia has been a role model in how to accept and treat refugees with humanity and kindness,” including opening its schools and hospitals to the Venezuelan refugees.
#1: Brazil’s election of Jair Bolsonaro as its new populist president because Brazil, with its 200 million population, is one of the key economic drivers of Latin America. He ran on a platform focused on crime and corruption, both of which are dragging down Brazil, as well as some controversial ideas. It’s early in his presidency, so at this point, his affect is unknown, points out Berger.