Part II: Spain's Air Europa bets on 787s to widen its footprint in Latin America

Air Europa is spinning an expanding network from Madrid to Latin America, where it now serves eight destinations in seven countries with a new gateway in Bolivia coming online in Nov-2012. The small SkyTeam carrier's niche Latin America strategy is not new and it is a logical one given the geographic location of Spain on the European continent and the historic and linguistic ties of the country with most nations in Latin America.

But the endeavour is getting increasingly difficult with a larger peer in its backyard, Iberia, and very adverse economic circumstances in Spain that suppresses demand. In attempts to offset the weakness in Spain, Air Europa is focusing more on point of sales in Latin America and other European countries as it continues to grow its short-haul international network. Only about 40% of the carrier's sales on its Latin America routes now come from Spain, compared to 60% previously.