Boeing: Latin America Carriers To Need 2,500 Jets Over 20 Years

Date : 03/27/2012 @ 1:24PM
Source : Dow Jones News
Stock : Latam Airlines Grp. S.A. (LTM)
Quote : 12.12  0.2 (1.68%) @ 10:32AM

Boeing: Latin America Carriers To Need 2,500 Jets Over 20 Years

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Latin America's airline sector will need nearly 2,500 airplanes over the next 20 years to continue its development, Van Rex Gallard, Boeing Co.'s (BA) vice president of sales for Latin America, Africa and the Caribbean, said Tuesday.

The airline industry is key for economic growth in the region as it creates jobs, contributes to governments with several kinds of taxes, and is important for the development of Latin American countries, he added.

The estimation of 2,500 aircraft for the next 20 years includes replacement and organic growth for the overall industry. Gallard estimated the average cost for each plane at $250 million.

Gallard, who spoke on the sidelines of Santiago's Fidae International Air and Space Fair, said the delay in the delivery of the new Boeing 787 Dreamliner, on display at the fair, hasn't severely affected sales in the region.

"We haven't been able to sell it the way we wanted, and we have caused problems to our clients that were ready for it. But the reason is that we are trying to make improvements in the airplane and avoid situations such as those that have affected other suppliers," Gallard said in reference to the problems experienced by Airbus 380. Airbus is a unit of European Aeronautic Defence & Space Co. (EADSY, EAD.FR).

Chile's flagship carrier LAN Airlines SA (LFL, LAN.SN) has acquired 32 Dreamliners, while Mexico's Aeromexico purchased 12 and Central America's AviancaTaca Holding SA (PFAVTA.BO) bought seven. Boeing is also in talks with smaller Latin American carriers to update their current fleets with the new 737 Max unit.

Gallard said he sees Latin America as one of the most-attractive regions for Boeing, not only considering the growth of its airline industry, but also because regional airlines are experiencing a healthy growth and are able to invest increasingly more resources.

-By Cristina Molina, Dow Jones Newswires; 56-2-715-8949; cristina.molina@dowjones.com

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