TAM Airlines Reducing Brazilian Operations In 2015
Photo: Despite a capacity reduction, TAM Airlines will continue to serve Brazilian cities including Porto Alegre. (Photo by Brian Major).
Citing “declining demand” and a “challenging economic scenario” in Brazil, TAM Airlines will reduce its operations in the country by eight to 10 percent in 2015, said company officials in a statement.
TAM will continue to offer flights to the Brazilian destinations it currently serves, the officials said. TAM’s move to reduce its capacity in its home country will include a staff reduction of “less than two percent considering normal turnover.” Flight crew personnel will not be affected by the reduction.
TAM officials said Brazil’s “increase in inflation and appreciation of the U.S. dollar versus the Brazilian real” had prompted a Brazilian airline industry “slowdown” leading the company to alter its strategy. The changes will allow TAM, a LATAM Airlines Group carrier, to “remain committed with its long-term sustainable development and growth plans for Brazil,” they said.
After a high point during last year’s World Cup competition, which was held in 12 Brazilian cities and prompted an increase in flights to and within the country, TAM officials say data from Brazil’s National Civil Aviation Agency indicates demand is declining.
In addition, a July 10 Brazilian Central Bank report projects “a further decline of the Brazilian gross domestic product (GDP) in 2015, with estimates revised down from a contraction of 1.3 percent to a 1.5 percent decline.” The U.S. dollar is expected to continue to strengthen against the Brazilian real, the bank reports.
“TAM is taking this measure to face the difficult economic scenario of the country,” said Claudia Sender, TAM’s chief executive. “It is necessary to make adjustments to our network while maintaining the connectivity we offer our passengers, and strengthening even further the company’s competiveness in Brazil.”
Added Sender, “We continue to believe in the country’s recovery and this adjustment in no way affects the company’s long-term strategy including renewal of the fleet and the continuous strengthening of our hubs in Brasília and São Paulo/Guarulhos.”
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