Six Months In: Argentina’s Civil Aviation In 2023

Argentina is bouncing back to its pre-pandemic traffic levels in 2023, fueled by a robust domestic market, although the international segment remains well below 2019, according to the latest data released by the country’s Civil Aviation National Agency (ANAC). How’s Argentina’s civil aviation industry doing in 2023? Between January and June 2023, Argentina received 13.66 million passengers. Compared to 2022, that’s a 48.8% growth as the country continues to soar back to pre-pandemic traffic levels. In June alone, the country had 2.23 million passengers. That number is only 2.1% below 2019 June traffic levels, signaling Argentina could easily close the year above pre-pandemic levels. We published a report on Argentina’s air traffic performance last year which you can read here. Domestic performance The recovery of Argentina’s traffic levels is explained by the strength of the country’s domestic market. According to ANAC’s latest data, the country had 8.08 million domestic passengers in the first half of the year. In June, Argentina had a 16.4% growth versus 2019. In 2019, the country had four main domestic carriers, Aerolíneas Argentinas, LATAM, Flybondi, and JetSMART. LATAM’s domestic branch in Argentina closed during the COVID-19 pandemic, and the two ultra-low-cost competitors, Flybondi and JetSMART, have taken the opportunity, capturing the market left by the exit of this competitor, while Aerolíneas Argentinas has mostly remained with the same market share it had prior to the COVID-19 pandemic, as the following chart shows: [caption id="attachment_75356" align="alignnone" width="580"] Photo: ANAC.[/caption] The international performance Despite the strong resilience of Argentina’s domestic market, the international segment has not recovered equally. There are many reasons attributable to that, but one of the main ones is the implementation of a special tax on expenses related to touristic activities (and other activities) when they surpass US$300 monthly. Between January and June 2023, Argentina had 5.57 million international passengers, a 73.7% growth versus 2022. Nonetheless, if we look at June’s numbers versus 2019 levels, the country is still 22.4% below its international traffic figures. The international load factors of the main airlines flying in and out of Argentina range between 73% (GOL Linhas Aéreas, the Brazilian carrier) and 93% (American Airlines). Aerolíneas Argentinas’ load factor is 85%. How things are looking for the rest of the year Fueled by the domestic market, we could expect Argentina to close 2023 above pre-pandemic traffic levels. According to the country’s data, the traffic levels finally surpassed 2019 numbers in the last week of June. [caption id="attachment_75355" align="alignnone" width="580"] Photo: ANAC.[/caption] Aerolínea Argentinas also expects to have a record winter season this year. It expects to have 5.5 million domestic tourists and 1.5 million international tourists, according to a statement released by the State carrier on June 30. The country’s Economy Minister said, “Tourism is one of the vital sectors for the economic development of Argentina to seek a record. I would like to invite all the actors in the sector to work together, thinking of two things: first, we set ourselves the goal of beating our historical record in this winter season so that more tourists from all over the world come to Argentina and so that all Argentines can visit our country. But above all, so that we have the capacity to project this sector for the medium and long term.”

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