Regular domestic air passenger market dynamics: The Brazilian case

Elton Fernandes; Ricardo Rodrigues Pacheco; Erivelton Pires Guedes; Vicente Aprigliano

doi:10.24294/jipd.v8i6.4908

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Regular domestic air passenger market dynamics: The Brazilian case

Elton Fernandes

Ricardo Rodrigues Pacheco

Erivelton Pires Guedes

Vicente Aprigliano

Journal of Infrastructure Policy and Development 2024, 8(6), 4908; https://doi.org/10.24294/jipd.v8i6.4908

Submitted：28 Feb 2024

Accepted：17 Apr 2024

Published：01 Jul 2024

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Abstract

Brazil occupies a prominent position as one of the largest domestic air passenger markets globally. In May 2019, OAG Aviation Worldwide Limited (OAG), a renowned global travel data provider, ranked Brazil as the world’s 6th largest domestic market. This study identifies and meticulously analyses statistical trends in how service levels affect passenger demand on domestic air routes in Brazil. To that end, it employs a panel-data gravity model incorporating service as an instrumental variable. The findings confirm the influence of traditional gravity explanatory variables, while also contributing novel insights into the impact of service levels on domestic routes. The analysis reveals that, while factors such as income and distance play a fundamental role in shaping domestic demand, level of service emerges as a crucial determinant on regional connections. Overall, the statistics suggest growing divergences between Brazilian airlines and regional air transport. Accordingly, substantial changes are necessary in both government policies and the services offered by the airline industry in order to harness the full potential of Brazil’s domestic air transport passenger market and foster regional development.

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References

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