Yesterday we discussed British Airways lack of routes to South America and why many in the industry feel that now is the time for the airline to significantly increase its footprint.
Despite its huge oil reserves, Venezuela has become something of a basket case, both economically and politically, so British Airways will not be flying to Caracas we don’t feel. The economies and populations of Bolivia, Ecuador, Guyana, Paraguay and Uruguay are still far too small so we don’t think that British Airways will fly to any of them anytime soon.
That leaves Argentina & Brazil, which British Airways already fly to, plus Chile, Peru & Columbia.
Argentina is really all about Buenos Aires and, as a result, we don’t see British Airways flying to any other destinations within the country.
Brazil is the largest country in South America with by far the biggest economy and population. Although its economic growth has slowed, it is at least still growing, as is trade and tourism with the UK. The World Cup in 2014 and Olympics in 2016 are also sure to further increase traffic. Sao Paulo & Rio are Brazil’s dominant cities however and rather than risk new destinations, we feel that British Airways will simply increase capacity to Sao Paulo & Rio, either with increased frequencies or bigger aircraft (perhaps even introducing the A380 to Sao Paulo in time for the World Cup) and using TAM to generate increased feeder traffic.
Within South America, Chile, Peru & Columbia are possibly the most successful economies at present; all 3 are stable, outward looking and committed to free trade. Together with Mexico, they form the Pacific Alliance, the region’s newest and most promising trading bloc, committed to reducing trade barriers such as restrictions on airlines & flights.
Of these 3 countries, Chile, the most economically advanced, is probably the most likely new destination for British Airways, especially as oneworld partner LAN has its base in the capital, Santiago de Chile.
The economy of Columbia is also very strong and, with its relative proximity to the USA, British Airways’ key market, we feel that Bogota would be the second new destination for British Airways within South America.
Finally, Peru, like Chile, is a long flight from the UK but has a strong and growing economy and, far more so than both Chile and Columbia, has very strong appeal to the leisure market. We therefore rate Lima as the third most likely destination within South America to receive British Airways flights.
Whether any of these predictions come to fruition only time will tell. One slight caveat is that all 3 routes will only become practical once British Airways has the 787 in its fleet. As none have yet been delivered, and the first 7 have been set aside to replace existing, ageing 767s, it may not be until late 2014 or even 2015 that the airline can even consider new routes to South America.