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Weekly Roundups

Mercado Libre Improves Last-Mile Logistics

By Alessa Flores | Thu, 11/05/2020 - 13:48

Mercado Libre announced an improvement in its last-mile logistics system to ensure delivery to its users within 24 hours. According to David Geisen, Mercado Libre's Director-General, this improvement includes the rental of four dedicated planes for Mexico and another four planes for Brazil, says a note by Expansion. This project represented an investment of MX$1 billion (US$48.22 million) as part of the US$120 million investment that Mercado Libre announced at the beginning of 2020.

During the pandemic, Mercado Libre has recorded revenues of US$878.4 million and noted that its number of unique active users grew by more than 45 percent to 51.5 million. 

Now let’s jump in The Week in Aerospace!

V-Shaped Recovery for Mexico’s Exports

Specialized products exports, including aerospace and technology products, showed positive results in 3Q20, pointing to a V-shaped recovery that could benefit the overall Mexican economy. Between January and August 2020, exports of advanced technology suffered a drop of 2.8 percent compared to 2019. However, according to the US Trade Department, exports rose in June by 6.3 percent, in July by 6.9 percent and August by 2.3 percent, reports El Economista.

The aerospace sector, in particular, keeps growing and despite the pandemic, companies have positive forecasts for its future development. In 2004, the country had 100 companies specialized in this area and in 2019 there was an increase of 260, according to FEMIA. Of the entire pool of companies, 72.2 percent are manufacturers, 13.2 percent focus on design and engineering, 11.2 percent on MRO activities and 3.4 percent offer supporting services, report El Economista and FEMIA. The association also estimated that in 2019, 48 percent of the FDI in the sector came from the US and 36 percent from Canada.

Air Cargo Goes Up in September

Globally, air cargo saw an 8 percent year-on-year decrease in September, according to the International Air Transport Association (IATA). While still below 2019 levels, it shows an uptick from the previous month’s 12.1 percent drop, which IATA credits to an increase in manufacturing and trade across many nations affected by the COVID-19 outbreak. As the pandemic spread during the early months of 2020, the World Trade Organization (WTO) estimated a global contraction in trade of 12.9 percent but a stronger June and July led the organization to revise this number to a 9.2 percent decline. WTO also expects trade to continue recovering and sees a 7.1 percent increase during 2021, which can be expected due to rising demand for air cargo as the sector represents 35 percent of the world trade by value.

Interjet’s Financial Update

Interjet has been dealing with financial troubles for a while now and COVID-19 is not improving the situation. As previously reported by MBN, Interjet issued a statement saying it would return to regular operations yesterday, after canceling all flights on Nov. 1 and 2. The company also lamented the affectations caused to users. While PROFECO said it would emit an alert against the airline, on Tuesday the company also had to face a workers’ protest due to pending wage payments. 

Through a statement, Interjet announced that executives had a meeting with workers to reach an agreement to settle their demands. It was also stated that the COVID-19 pandemic has been harsh on the company and its operations, but Interjet would pay any outstanding wages nonetheless, which according to union leaders amount to two months of salaries and three months of vouchers to unionized staff. The company has released several messages where it made it clear that paying its staff was a priority. 

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Alessa Flores Alessa Flores Senior Journalist and Industry Analyst