Nearshore Americas
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As Airlines Go Bankrupt, Traveling to Latin America Becomes a Challenge

With three major airlines going bankrupt and another two halting operations, booking a flight to a Latin American destination has become a challenge these days. 

The region, heavily dependent on mineral exports and tourism to sustain its growth, has taken a devastating blow from the pandemic.  The airline industry is among the worst hit. 

Analysts now say that the carriers will continue to operate fewer routes for many months to come and that the industry may take four years to recover to pre-crisis levels

 Peter Cerda, Vice President for the Americas at the International Air Transport Association told The Financial Times recently that “long-haul business travel will take longer to recover.” That’s largely because those carriers that are restructuring their balance sheets may not be able to expand their operational capacity at least for the next couple of years.

However, short-haul flights between the United States and Central American countries, including Mexico, will be resumed soon after the pandemic recedes in the United States.

In the past few weeks, some countries, including Uruguay, have managed to restore some flights to Europe and North America.  All countries in the region were not so lucky. The number of international carriers serving Mexican destinations nearly halved between April and July, from 64 to 34, according to the British daily.

Today, three regional airlines – LATAM, Avianca, and Aeroméxico – have sought protection from creditors. In addition, Ecuador’s TAME and Caribbean airline Liat have ceased operations.

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Unlike in the United States, airlines in Latin America could not get any government aid to remain operational. Some regional carriers are negotiating with governments for a bailout. None of these talks have been fruitful yet.

Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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