LatAm-North America: Washington’s Badly Timed Own Goals

Why It Matters

The abrupt policy moves create operational risk for airlines, shippers, and exporters, potentially curbing revenue and disrupting supply chains in a high‑demand travel period.

Key Takeaways

• DHS threatened to pull Newark customs staff, then reversed after protests.
• U.S. proposes 25% tariff on Brazilian imports, heightening trade uncertainty.
• Peru keeps $12 international transit tax, could cut passenger flows 11%.
• Quito airport overtook Santiago in cargo rankings, driven by flower exports.
• Avianca Cargo's Amazon deal adds new Miami freighter capacity for Ecuador.

Pulse Analysis

Washington's recent policy swings are rattling the trans‑American aviation ecosystem. The brief threat to withdraw customs and immigration personnel from Newark—a key United hub—sparked alarm across airlines and freight forwarders, who feared bottlenecks that could erode passenger and cargo throughput during the World Cup surge. Although the DHS head backed down after lobbying, the episode underscores how sanctuary‑city politics can quickly translate into operational uncertainty. Coupled with the U.S. Trade Representative’s 25% tariff proposal on Brazilian goods, the climate of unpredictability is forcing carriers to reassess route profitability and hedge against sudden cost spikes.

In the South American corridor, Peru's decision to retain an $11.86 levy on international travelers adds another layer of friction. Industry analysts estimate an 11% dip in transit passengers, a loss that could translate into thousands of fewer flights annually. The tax’s impact reverberates beyond tourism; Chile’s $6 billion salmon export sector relies on seamless air links, and any reduction in flight frequency threatens market access. Meanwhile, Santiago’s Arturo Merino Benítez Airport continues to prioritize passenger infrastructure at the expense of cargo, allowing Quito’s Mariscal Sucre Airport to leapfrog into the region’s top‑four cargo hubs, buoyed by an 11% rise in flower shipments.

Data from WorldACD shows a 20% plunge in Central/South America‑to‑North America tonnage during the May 11‑24 window, reflecting the end of the Mother’s Day flower rush and a 13% rate drop. Yet year‑on‑year volumes remain modestly higher, and rates have risen 10% despite the short‑term dip. Avianca Cargo’s renewed partnership with Amazon, adding five weekly freighter flights between Quito and Miami, illustrates how carriers are seeking stable, high‑value lanes to offset volatility. As the football tournament approaches, shippers and airlines will be watching Washington’s next move closely, hoping for policy stability that safeguards both passenger demand and cargo profitability.