Mexico increases its foreign investments in aeronautical industry 88%

Mexico raised its foreign investments captured in the aeronautical industry by 88% in 2020, amounting to 249.7 million dollars.

This is the highest amount since 2015 and coincided in a year in which an acute crisis was generated in the aeronautical industry worldwide.

For now, global economic growth, one of the main drivers of air travel, is expected to have slowed to 4-5% in 2020.

Within the industry, the most recent forecast from the International Air Transport Association (IATA) projects that passenger traffic for the full year 2020 will decline more than 60% compared to 2019, as global economic activity slows due to the pandemic and governments severely restricted travel to contain the spread of the virus.

The trajectory of foreign investments captured in the aeronautical industry shows that in 2018 they totaled 116.8 million dollars and that the following year they totaled 132.7 million.

Aeronautical industry

This industry comprises establishments that are mainly engaged in the following activities:

  • Aircraft manufacturing.
  • Manufacture of aerospace engines, propulsion units, auxiliary equipment or parts.
  • Develop and manufacture prototypes of aerospace products.
  • Aircraft conversion (i.e. major modifications to systems).
  • Overhaul and complete rebuild of the aircraft or propulsion systems (i.e., periodic restoration of the aircraft to original design specifications).

At a global level, the recovery remains slow and uneven, as travel restrictions and different regional travel protocols continue to affect air travel.

Generally, we expect domestic travel to recover faster than international travel.

Air cargo traffic levels contracted this year due to weak global trade growth and capacity constraints given the large impact COVID-19 has had on international operations of passengers, which also carry cargo. Demand for dedicated freighters is developing better relative to freight traffic trends.