For our Perspectives series, we talk to experienced business aviation industry professionals, who share with us their unique insights and offer a window into their world. This month's interviewee is Francisco Zozaya, JSSI’s senior VP of business development and strategy. Based in Mexico, he paints a detailed picture of the region, revealing that over-and-above pandemics, politics can have a profound effect on private flying.

“Latin America extends from the Spanish and Portuguese-speaking countries, so starting from Mexico all the way to Argentina. Although Mexico is technically part of North America, we usually include it as part of Latin America. The two main Latin American hubs would be primarily Mexico and Brazil, in terms of the number of installed aircraft. Mexico and Brazil are typically countries with the second or third highest amount of business jets worldwide. The US has roughly 12,000 business jets, and then after the US you have typically Canada, Mexico and Brazil with about a thousand each. This fluctuates every few years, depending on the economies of each country, but it’s roughly around those numbers.

A lot of the activity is concentrated in the larger cities, so in Brazil typically Sao Paulo, Rio de Janeiro, Belo Horizonte and a few other spots. In Mexico it would be Toluca, which serves Mexico City, Monterrey, Guadalajara and a few other cities. Activities are focused on just handful of places.

Then you have Argentina, which has a solid aircraft base and is a longstanding market for our industry, although the political environment and macroeconomics haven’t helped a lot. But it is still a very decent market.

Next you have a small but interesting fleet in Chile, typically with newer aircraft. If you look at Central America as a whole, you would say that Guatemala, the Dominican Republic and Panama are the largest hubs. In the past Venezuela was an incredible market; it was rising, but after the crisis that is happening in the country, unfortunately we’ve seen a decrease in the activity and the fleet there. Before the crisis, it would have been the third largest market for Latin America.

Between 70 and 75 per cent of the region's aircraft transactions are pre-owned in-service transactions. New deliveries are somewhere between 20 and 30 per cent, depending on the year. The heavier metal tends to be based in Brazil, while in Mexico the bulk of the fleet is midsize, because most of the activity happens in-country, or towards the US. A flight from the primary hub Toluca to New York takes about five hours, which is not long. A flight to Miami is about three-and-a-half hours. Some people go skiing to Colorado, which involves about four hours of flying. So there is not really a requirement for long haul aircraft. This has really transitioned in recent years and the market has really matured. We’ve gone from the Hawker being a very popular aircraft in Mexico, because it would cover all the required bases; Learjets have always been very popular in the region as well, and these customers have started to migrate to midsize, maybe super midsize, up to a Challenger 605 or a G450. Gulfstreams are popular in Toluca because of their hot and high performance. The airport lies just above 8,000 ft above sea level, and not all aircraft can complete a single leg across the pond from there.

For Central America, I would say that the majority of flights are to Florida. Miami seems to be a hub for business aviation, for both Central and South America. There are many aircraft both registered and based in south Florida, with an ultra high net worth owner who has a Latin American background, or they have their businesses based in Latin America.

The COVID situation has been different for Latin American countries when compared to countries with more mature economies. Our countries are highly populated, with a high percentage living in very unfavourable conditions, so a lockdown is just not possible. People need to go out to work every day, they need to use public transportation and the population is very dense, so this makes it almost impossible to control, and this is why we have seen hardly any decline; numbers are continuing to rise.

JSSI covers over 2,000 aircraft worldwide. There are just over 20,000 business jets globally, so we have a good sample size, close to 10 per cent. In North America we have seen, month over month, from April to May, an improvement of about 89 per cent in flight activity. In Mexico and Central America we only saw an improvement of 13 per cent. For the month of May, North American’s YoY decline was 48 per cent, while for Mexico and Central America it has been over 70 per cent. Year to date there has been a decline of 33 per cent.

For South America, south of Panama, Venezuela, Colombia and the rest of the southern countries, the figures are a little bit better. We’ve seen a month-over-month increase of 76 per cent. May 2019 versus May 2020 we have seen a decline of 59 per cent, and year to date a 36 per cent decline. So South America is feeling it toughest year to date, matched only by Africa.

We track flight activity by industry as well. Real estate is down 38 per cent year to date, power and energy down 35 per cent and manufacturing 41 per cent down. Healthcare is a little bit better, because you have all the EMS operators, so that’s only 20 per cent under the previous year, but under nonetheless when you would have thought it would have even gone up. The financial services sector is doing very poorly (down 44 per cent). while consumer goods is down 39 per cent. And then what concerns our industry, charter operations are 30 per cent under the previous year, to date.

It’s quite surprising to see a recovery of 89 per cent month over month in North America, given the current circumstances. What’s interesting to see is that when you talk about aviation, we talk about business aircraft. We’ve seen an improvement of 70 per cent as well, month over month. I believe this is partially driven by new users. All of the charter operators are starting to pick up, and I think it does actually prove the theory that the people who can afford the service will start to prefer certain business aviation solutions versus commercial.

Overall, the South America region is very driven by the political environment. Over the last 10 years, we saw an improving market in Mexico, but as soon as the government changed to a left wing party two years ago, the market started going down and the presidential aircraft was put up for sale, along with the rest of the presidential fleet, so now business aviation is not so well perceived as it was before.

In Brazil, it is the other way around. 15 years ago, the market was booming, then it definitely went down with the left government. We have started to see a recovery now. Unfortunately COVID hit, but with Bolsonaro in power, we have seen a little bit of an improvement.

Venezuela is another clear example. Before the crisis it was booming with the oil and gas industry, and then it just killed the business with the political crisis. It was the same thing for Argentina.

So it is a little bit of a rollercoaster, our region. When things are going well, everyone is happy and everyone is buying aircraft and flying all over the place. When the political environment changes, it directly affects business aviation.”