Technology transformation and a tight market

LATAM Cargo CEO Andrés Bianchi described 2026 as a “transformational year” for South America’s leading cargo carrier. The airline’s plan is to grow capacity between 5% and 7%, with revenues expected to rise faster. “That’s basically going to be driven by additional belly operations,” he explained. The freighter fleet remains stable at 19 aircraft, with a 20th undergoing certification in Victorville, California.

January started slow, but by February and March volumes were above plan. “We have seen a steady pick-up, and we are much closer, or even above plan, for February and March,” Bianchi said. Flower shipments, traditionally strong in February, were weaker this year, but overall cargo volumes recovered quickly.

LATAM Cargo operates a mix of 767 freighters and converted freighters. The 20th aircraft, currently experimental, is being used as a prototype to incorporate a lower-deck fire suppression system for dangerous goods. “We’ve been working with Boeing for a number of years since the programme started to address one issue… we want that because of the DGs,” Bianchi noted.

The airline plans to retrofit existing converted freighters to the new standard. For now, restrictions remain on certain dangerous goods carried on converted freighters. “Safety is the one priority. We’re making the investment because we believe it is necessary,” he emphasised.

Fleet age averages 11–13 years for converted freighters and 21 years for dedicated 767Fs. While the 767 fits LATAM’s network “like a glove", Bianchi expressed concern about the lack of a clear replacement. “The 330, which is the only similar aircraft, is clearly inferior to the 767… we need to look for something that replaces the 767 on the line and provides the right economics,” he said.

Load factors remain strong, particularly northbound into North America and Europe. “Southbound, they’re pretty close, over 85–90%,” Bianchi said. LATAM optimises belly capacity by planning passenger and cargo networks together. “Our main focus from a network planning side is to try to get the highest revenue per flight on the passenger flight, and then we play around with the freighter fleet to complement that,” he explained.

“Our main focus from a network planning side is to try to get the highest revenue per flight on the passenger flight, and then we play around with the freighter fleet to complement that.”
Andrés Bianchi, LATAM Cargo

Interline agreements are crucial, especially since LATAM is the only top-20 cargo carrier without direct flights to Asia. Partnerships with Cathay Pacific and others help feed cargo into LATAM’s network. “That being the largest market in the world, we need to cover it some way. And that is where the alliances and interline agreements come into play,” Bianchi said.

Yields have been volatile. The Red Sea blockage in late 2024 drove yields up, but 2025 saw a downward trend. “When you compare 25 against 24, you see a downward trend in yields basically because 24 ended on such a high note,” Bianchi explained.

So far in 2026, yields have stabilised. However, hostilities in Iran and rising fuel prices have forced LATAM to increase surcharges. “At least in our case, we have increased our fuel surcharge to reflect the higher cost of fuel," Bianchi said.

Global disruptions, particularly in the Middle East, have squeezed perishable flows from Africa and India. Bianchi acknowledged Latin America could step in to fill gaps but cautioned against rushing. “Since we don’t understand how long this can take, I think people are being reluctant to make changes quickly,” he said.

If fleet renewal is constrained, technology is where LATAM Cargo sees transformation. “The next step in the development, at least in our business, we believe it’s more along the lines of leveraging technology to the fullest to compensate for the lack of development in the hardware,” Bianchi said.

LATAM reorganised its tech approach a year and a half ago, adopting structures more akin to tech companies than traditional airlines. AI tools are now being used for coding, forecasting, and optimisation. “We showcased internally a product that was going to take nine months to code. The team was able to code in five days,” Bianchi said proudly.

Digital tools are already improving customer service. One example is documentation discrepancy resolution, which used to take hours. “Now we can solve that issue in less than five minutes… satisfaction with that went from 15% to 85%,” he said.

Sustainability remains central. LATAM recently announced a partnership with Kühne + Nagel on sustainable aviation fuel (SAF). “Sustainability keeps being at the forefront of what we do. We believe our customers require it,” Bianchi said. He added that end consumers increasingly want to know if their purchases are environmentally responsible.

Looking beyond LATAM, Bianchi sees a healthy but challenged global air freight industry. “Despite the hiccups, this industry has grown a lot after COVID and has learnt a lot after COVID," he said. But technology lags remain a major hurdle. “That is hindering our development. Not only at the internal company level, but also the integration within the ecosystem,” he cautioned.

Capacity will be tight in the coming years, with slow widebody deliveries and no replacement for mid-sized freighters. “The belly side is still slow with the deliveries of the widebodies. That is going to impact the development of the new freighters,” Bianchi said.

Despite these challenges, he remains optimistic. “Overall, I would say that despite the storms, the industry is doing a good job. And I think our competitors are doing a very good job. We are happy with that.”

For LATAM Cargo, 2026 is about balancing measured growth with long-term fleet planning while leaning heavily into technology to unlock efficiency and customer value. As Bianchi summed up, "We expect that by the end of the year we are going faster in terms of traffic because we can leverage our assets better. Now we have got to build the tech around it to take it to the next level.”