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How airlines decide the average size of airplanes in Brazilian market? Study of the determinants and projections for the next decade

Author(s): Thyago Silva Hermeto

Journal: Journal of Transport Literature
ISSN 2238-1031

Volume: 6;
Issue: 1;
Start page: 122;
Date: 2012;
Original page

Keywords: average aircraft size | elasticity | logistics | aircraft transport

In Brazilian market, all airlines companies have a complex problem to solve, regarding the ideal profile for the aircraft fleet: Embraer`s aircraft profile (availability of seats 100 passengers) aircraft or Boeing or Airbus profile (available above 140 seats)? To answer this question is necessary to think about the following boundary conditions: (1) the organic growth of passangers at a rate of 11,8%/year (2003-2008), (2) physical limitations of the major airports - the ability of the passenger terminal, number of lanes, number of slots in the apron area, (3) the rate of completion of infrastructure works in this short of monitoring the speed of demand growth displayed until the present moment. To address this issue, this econometric study presents the evolution of the average size of aircraft used in Brazil. The middle step practiced by airlines is the variable that causes the choice for larger aircraft, with elasticity of 37,9%, in contrast, GDP growth leads to a choice of smaller aircraft, elasticity of –17,6%. The conclusion is that neutral scenario proved to be more consistent with market reality, there is an initial decrease of 6.5% over the average size of the aircraft in July 2010 and July 2020 shows an increase of 9.8%.
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