What Latam’s first post-pandemic profit says about South America’s travel recovery

South America’s largest carrier Latam Airlines Group has turned its first profit since the pandemic hit, and expects an even bigger boost from a new partnership with Delta and its exit from bankruptcy later this year. Travel demand is recovering faster than the Chile-based airline group forecast just a year ago. Passenger traffic at its domestic and regional — international flights within South America — business segments are expected to fully recover by year end, an updated business plan released Tuesday shows. That is, respectively, a quarter and a year earlier than previously forecast. Latam’s long-haul international business is expected to fully recover in the second quarter of 2023, more than a year earlier than the airline’s 2021 business plan. The bullish forecast comes after Latam turned its first monthly profit since the pandemic began in July. The airline posted a $27.3m operating profit on $896m in revenues during the month. The airline still anticipates an operating loss for the year, but expects a full-year operating profit in 2023 with the amount surpassing $1 billion a year later. “Pent up demand has been driving a faster recovery,” Latam said in the presentation echoing the rapid pick up in travel demand that airlines around the world have seen this year. Travelers have surged back to the sky in Latin America as Covid travel restrictions have eased. Passenger traffic in the region was just 14% below 2019 levels in June, while the Brazilian domestic market — one of the largest in the world — was down just 4%, the latest IATA data show. This tracks with the improving fortunes outlined by many of the region’s airlines.<br/>