CAPA Americas Summit: Latin America remains promising as open skies drives US international growth

The evaluation process that airlines use to determine the viability of international routes goes far beyond merely calculating potential profitability. Myriad considerations need to be undertaken, including ease of doing business with governments, infrastructure constraints and the customer experience of passengers travelling to the end destination.

Although American and Delta continue to trumpet the need for government-to-government consultations between the US and the UAE and Qatar regarding open skies agreements with those countries, fully liberalised air service pacts remain the cornerstone for international expansion from the US. Particularly so for airports outside the hub systems of the three large global US network airlines.

A pending open skies agreement with Brazil, a new bilateral with Mexico and the recently concluded agreement to resume scheduled flights between the US and Cuba have created new opportunities for US airlines to broaden their reach in Latin America and the Caribbean. But there are obviously inherent risks in undertaking expansion to those regions, and the rewards from growing on routes to those countries may only manifest themselves in the medium to long term.