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LATAM moves ahead with Miami hangar

By John W. McCurry on June 4, 2014

LATAM Airlines Group broke ground Wednesday on its US$15 million (11 million euro) maintenance hangar at Miami International Airport (MIA). The new facility, which will be completed in 12 to 14 months, is the company’s first maintenance hangar in the U.S. and figures to benefit cargo operations. It will be able to accommodate aircraft up to a Boeing 777-300.

“With the hangar, we will be able to take full advantage of the time we have the aircraft here, performing line maintenance, engine changes and major repairs,” Fernando Poitevin, COO of LAN Cargo, says.

Company officials project that LAN Cargo and its affiliates will move more than 4,500 tonnes of cargo imports and 3,500 tonnes of cargo exports through MIA per week, or approximately 414,000 tonnes in 2014.

However, Poitevin acknowledges that that last few years has been challenging for cargo in terms of demand.

Northbound cargo, of which 90 percent is perishables, has been strong for years. However, it’s been a different story lately for southbound products.

“We have seen strong growth out of the perishables markets in Chile, Colombia, Ecuador and Peru,” Poitevin says. “The challenge is mainly on the southbound flows. This year has been somewhat flat and we were able to adjust our network and today we are flying our freighter fleet less and taking more advantage of our passenger fleet bellies.”

Poitevin (pictured right) says the hangar will provide the LATAM group with more flexibility within its maintenance network, which includes two heavy maintenance facilities in Chile and Brazil. LATAM considered several options before choosing Miami.

“We have a very stable and positive scenario in Miami and have been working here for the last 20 years. We really have a lot of confidence in Miami that from a work force standpoint, we will be able to attract the talent and technical expertise we need. Miami is also a gateway to Latin America for both cargo and tourism.”

Poitevin doesn’t believe southbound cargo will stay stagnant, but it has been disappointing of late.

“We were expecting some uptick previously, but unfortunately we haven’t seen that. That said, in the medium- to long-term, we are confident in the growth of Latin America and we expect that cargo demand will follow that growth. We will see some growth during the second half of the year, but generally the second half is better than the first half.”

Southbound cargo includes high-tech products, pharmaceuticals, automotive spare part and oil and mining equipment.

“We move live animals once in awhile, but generally speaking, it’s mostly high-tech,” Poitevin says.

LAN Cargo will continue its strategy of complementing its freighter fleet with the bellies of its passenger planes.

“We are convinced a mix of both is the one that will provide us with a competitive advantage. Our goal is to keep improving our load factor and improving our connected. We have invested in processes and infrastructure.”

Infrastructure investments include LAN’s refrigeration facilities for perishables in Miami. The company has invested more than US$10 million (7.3 million euros) in it over the past few years.

Poitevin says LAN Cargo is making good progress with adaption of the e-air waybill. The carrier reached a 5 percent rate by the end of 2013 and is on track to finish 2014 at between 22 and 25 percent.

“We continue to focus on our partners and local freight forwarders, and we recently developed an online tool to aid small freight forwarders who do not have the capabilities and systems,” Poitevin says.