U.S. carriers jump into Latin America market only to find little demand

US carriers are facing some weakness in their Latin American performance as significant capacity growth between the two regions appears to be pressuring unit revenue and yields. All three major US network carriers with a robust presence in the market – American, Delta and United – watched their yields plummet during 4Q2012 as they expanded capacity significantly to Latin America year-over-year.

The weakness during the last three months of 2012 follows a somewhat lacklustre performance by those airlines during 3Q2012, which could indicate the US-Latin American market is reaching a certain level of maturity.