Hubbing in Latin America appears to be on the decline as the region's main cities continue to win new intercontinental service. The launch of Iberia's nonstops to Panama City, San Jose in Costa Rica, and Montevideo in Uruguay leaves only a handful of the smallest Latin America countries without direct flights to Europe and North America.

A few Latin American airlines, such as Colombian start-up Fenix, still propose to collect passengers from cities throughout South and Central America, bring them into its Bogotá hub, and then fly them to Europe. This use of sixth freedoms was once traditional among Latin carriers, but is now rare.

Few European carriers tried to match it because they lacked comparable fifth freedoms. They focused instead on larger Latin cities. Yet, as shown by the 82% load factor that Iberia is enjoying on its new Montevideo route, even smaller markets can support nonstops.

The next phase in this fragmentation is already starting. Overseas carriers are launching flights that bypass Latin capitals and fly directly into secondary cities. Guayaquil, for example, now rivals Quito as Ecuador's main gateway. Mexico's Guadalajara and Cancun host direct European flights. São Paulo and Rio de Janeiro have become Brazil's twin gateways, with such secondary cities as Manus, Recife, and Fortaleza vying for international routes.

To support its strategic shift within Latin America Iberia has signed a codeshare with TACA Group.


Source: Airline Business