This year’s LABACE will be a watershed event

 - March 16, 2007, 2:30 PM

The upcoming second annual edition of the Latin American Business Aviation Conference & Exhibition (LABACE) will be an important test of whether the event has long-term growth potential.

This year’s show, to be held April 15 to 17, is returning to the Transamerica Expo Center in São Paulo, Brazil, and is once again being jointly promoted by Brazil’s business aviation association, ABAG (Associacao Brasileira de Aviacao Geral), and NBAA.

LABACE organizers have predicted that the event is “on track” to surpass the mark made by the inaugural event last year, namely almost 2,900 trade visitors, 88 exhibiting companies and 16 aircraft on static display at São Paulo Congonhas Airport. At press time the event was backed by 79 exhibitors.

LABACE 2003 generally made a good impression on participants. That said, several exhibiting companies have since indicated off the record to AIN that they will need to see significant growth in the number of bona fide business aircraft operators and other prospective customers at this year’s event to justify their continued support.

The following business jet manufacturers are now committed to exhibiting at LABACE 2004: Bombardier, Dassault Falcon Jet, Embraer, Gulfstream Aerospace and Raytheon Aircraft. Single-turboprop rivals EADS Socata, Ibis Aerospace and Pilatus are also on the list. This year’s static display roster has yet to be posted but, with the exception of Ibis (the Czech/U.S./Taiwanese joint venture producing the Ae270 utility aircraft), all of these airframers are expected to display their products at Congonhas Airport.

Leading Brazilian executive charter operator and Cessna sales representative Taxi Aereo Marilia is also expected to show at least one Citation and a Grand Caravan. As the manufacturer with home-field advantage, Embraer is certain to display its Legacy business jet.

Despite its billing as a Latin American event, the first LABACE was, in reality, largely a Brazilian event. Indeed, much of the impetus for the show appeared to come from the city and state of São Paulo, which arguably constitute Brazil’s economic hub. It remains to be seen whether LABACE can grow to fulfill its promise to serve as both a showcase and platform for business aviation through all of South America.

Geographically, at least, there ought to be enormous potential for business aviation growth in Latin America. All the classic ingredients are there: large distances, a patchy scheduled airline service network and prospects for increased cross-border trade through agreements such as the Mercorsur pact currently encompassing Brazil, Argentina, Paraguay and Uruguay (and extended to include Chile and Bolivia). Brazil alone has 2,014 civil airports (715 are public and the rest private), but the airlines
fly to only 180 of these.

But while Latin Americans may well have the need and the desire for business aircraft, it is still questionable whether the region has sufficiently firm economic foundations on which to build sustained demand and fleet growth. Certainly the latest edition of Honeywell Aerospace’s annual business aviation outlook survey does not give grounds for unbridled optimism. “Purchase expectations in Latin America, expressed as a percentage of its current fleet, are significantly lower than in any other world region,” the report concluded when it was published at last fall’s NBAA Convention in Orlando, Fla.

The Honeywell forecast considers sales prospects for new “traditional business aircraft of less than 100,000 pounds gross takeoff weight.” Over the next five years, it predicted that Latin America will account for just 4.9 percent of global business jet demand–down from 5.6 percent in the 2002 survey. And the average age at which aircraft are projected to be replaced by Latin American operators increased by about 5 percent over 2002 to reach 15.7 years.

Latins Want Midsize/Super-midsize Jets
However, that is not to say there is no hope of selling business aircraft in the LABACE catchment area. Just over a third of the new aircraft that Latin American operators expect to take delivery of over the next five years will be new or derivative models. Honeywell’s surveyors found that “aircraft age and the preference for better cabins and more speed” were the most commonly cited considerations for new aircraft purchases by the Latin American respondents. These prospective buyers most commonly mentioned midsize and super-midsize business aircraft as being the class of equipment they are most likely to buy.

The second edition of the LABACE show has retained the late-start/late-finish format that sets it apart from both the NBAA event and the European Business Aviation Convention & Exhibition in Geneva. After an April 14 press afternoon, LABACE’s opening general session will be held on Thursday, April 15, between 10:30 a.m. and 11:45 a.m. and, to date, this is the show’s only scheduled conference/seminar.

Among the topics due to be addressed are safety and security initiatives; business helicopter operations; CNS/ATM and equitable access to airspace and airports; future of fractional ownership in Latin America; aircraft ownership options; and Brazilian regulatory update. On last year’s experience, a number of other meetings and manufacturer maintenance and operations sessions are likely to be scheduled between now and when LABACE opens.

The exhibition hall will be open between noon and 8 p.m. on April 15 and 16 and between noon and 6 p.m. on Saturday, April 17. The static display is open from noon to 6 p.m. each day. Congonhas Airport is a 20-minute shuttle-bus ride (in normal traffic) from the Transamerica Expo Center. LABACE closes with an awards reception and banquet on the evening of April 17 in the Hotel Transamerica, which is next to the convention center. AIN will once again publish a special Latin American supplement for the LABACE show. This will also appear in the May issue, along with full news coverage of the event.

LABACE organizers are still accepting exhibitor applications for both the convention center and static display. For more information visit the LABACE Web site at www.