As the airlines of Latin America and the Caribbean gather at this year's ALTA Airline Leaders Forum in Nassau, Flightglobal has examined the dynamics of the region's air transport markets in a special report.

Produced by Flightglobal's Ascend consultancy arm with data from the Ascend Fleets database and our flight schedules specialist Innovata, The New Latin Beat highlights the seismic changes that have taken place in the Latin American aviation market over the last 20 years. It explores the region's strong economic growth, the rise of consolidated airlines that have invested heavily in new fleets and service standards, and the expansion of the low-cost airline sector.

Our analysis shows that in the region's two biggest domestic markets, Brazil and Mexico, low-cost carriers account for more than 50% of capacity, but in almost all other domestic markets, budget airlines have been absent until recently.

The report says it will be interesting to see if the business model can adapt in smaller domestic markets, which are often dominated by incumbent airlines which may enjoy political support.

While domestic traffic in Brazil and Mexico accounts for almost 90% of the total low-cost-carrier capacity of Latin America-based airlines, the international LCC sector is very much underdeveloped. Flights from Mexico to the USA represent the largest international market from Latin America, but with Interjet and Volaris together accounting for just 10% of seats, this market remains small for the region's home-grown low-cost carriers.

Air traffic between Latin America and the USA looks set to grow after Brazilian carrier Azul revealed its intent to start operating to the USA from Brazil. However, intra-South American traffic is likely to remain limited.

The report also highlights the fact that just three intra-South American markets reach more than a million seats per year each way: Brazil-Argentina, Chile-Argentina and Colombia-Panama. These markets are dominated by network carriers, and the report notes that international operations on the often small markets between South American countries will be a tough nut to crack for low-cost carriers.

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Source: Cirium Dashboard