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Old August 14th, 2010, 06:49 PM   #361
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If separately they are 3 of the biggest airlines in Latinoamerica together they are gonna be top5 in the world..
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Old August 14th, 2010, 08:23 PM   #362
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SOURCE:Air Transport Intelligence news

LAN and TAM have not yet resolved alliance issue

By Brendan Sobie

Oneworld member LAN and Star Alliance partner TAM have not yet decided on an alliance strategy once they merge and create a new holding company.

LAN CEO Enrique Cueto told analysts during a 13 August conference call to discuss their proposed merger that alliances "will be an issue we will decide in the future".

Cueto, who will become CEO of the new parent company LATAM Airlines Group, added: "The alliance issue is an important issue in the future but now we don't have an answer to that question."

LAN has been a member of Oneworld since 1999 while TAM only joined Star earlier this year. Cueto says having one global alliance for the new group was not assumed when calculating the carriers' estimate for $400 million in annual synergies.

While LAN and TAM are currently in separate global alliances, they have had a long-standing partnership which includes codesharing, maintenance cooperation and joint purchases of aircraft.

Earlier this year TAM spun off its frequent flier unit, Multiplus, which is now traded separately from the Brazilian airline group on the Sao Paulo stock exchange. TAM president Libano Barroso says after LATAM is established Multiplus will continue to be operated as an "individual separate entity" with its own stock listing. He explains Mutiplus will continue to be controlled by TAM's holding company, which in turn will be controlled by LATAM once the proposed merger transaction is completed.

Libano says at some point Multiplus should have the opportunity to be extended to include LAN's frequent flier programme, LANPASS.

The vice-chairman of TAM's holding company and future chairman of LATAM, Mauricio Rolim Amaro, told analysts that TAM and LAN hope at some point to combine their frequent flier programmes as this would benefit all their passengers. He explained this would likely take the form of Multiplus expanding to include LANPASS but "it's much too early to ensure" this will happen.
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Old August 17th, 2010, 03:42 PM   #363
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Travel boost for South America as airlines agree to merge


Tuesday, 17 August 2010

Brazilian airline TAM is to merge with Chilean rival LAN, the companies announced last week, creating a Latin American "supercarrier" that could be good news for travelers.

If approved, the deal will create an airline that will strengthen transport links between Latin America and the rest of the world, flying to over 115 destinations in 23 countries.

In their joint announcement, the airlines said that their primary growth areas included routes between Brazil and Europe/Africa, as well as routes between Lima and North and Central America, pointing out that jointly the carriers will be able to offer destinations neither could have managed alone.

The deal is set to make the joint airline the second biggest carrier between North America and South America, creating considerable price competition with American Airlines, which currently holds top spot.

In between South America and Europe, the combined airline would be the fourth largest, behind British Airways/Iberia, Air France/KLM and Portuguese carrier TAP.

But it's not all good news - as the airlines are currently members of competing airline alliances (LAN is a member of oneworld, while TAM is part of Star Alliance), the likelihood seems to be that one of the alliances will be dropped, potentially damaging links into the region for the passengers of other member airlines of that alliance.

Airline analyst the Centre for Asia Pacific Aviation said that the previous consolidation seen from airlines such as Air France/KLM, Lufthansa and British Airways/Iberia will "pale in comparison to the effect that this group will have on its home turf."


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Old August 19th, 2010, 06:11 AM   #364
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AUGUST 18, 2010, 4:29 P.M. ET

Brazil Approves Tam Takeover Of Pantanal Airline -Estado

SAO PAULO (Dow Jones)--Tam SA (TAMM4.BR, TAM), Brazil's biggest airline, had its purchase of rival Pantanal Linhas Aereas approved by regulators, the local Estado news agency reported Wednesday.

Tam, which agreed this week to merge with Chile's Lan Airlines SA (LAN.SN, LFL), will be able to take over regional carrier Pantanal without restrictions, Estado said. Tam announced the takeover of Pantanal last year.

The antitrust regulator known as Cade said it is likely new competitors will enter the market and that the takeover of Pantanal, which was under Chapter 11 bankruptcy protection at the time of purchase, doesn't represent a threat to competition, Estado reported.

-By Paulo Winterstein, Dow Jones Newswires; 55-11-3544-7073; [email protected]
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Old August 28th, 2010, 02:20 PM   #365
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Brazilian Air Traffic Statistics: JAN-JUL/2010 vs. JAN-JUL/2009


Brazil in General

Aircraft movement (landings + take offs, JAN-JUL/2010)
  • JUL/2009 = 1.289.628
  • JUL/2010 = 1.483.859 (+15,1%)

Domestic Passengers (JAN-JUL/2010)
  • JUL/2009 = 62.666.762
  • JUL/2010 = 76.375.973 (+21,9%)

International Passengers (JAN-JUL/2010)
  • JUL/2009 = 7.452.154
  • JUL/2010 = 8.933.707 (+19,9%)

Passengers in General (domestic + international, JAN-JUL/2010)
  • JUL/2009 = 70.118.916
  • JUL/2010 = 85.309.680 (+21,7%)

Domestic Air Crago (KG, JAN-JUL/2010)
  • JUL/2009 = 310.300.317
  • JUL/2010 = 316.324.896 (+1,9%)

International Air Cargo (KG, JAN-JUL/2010)
  • JUL/2009 = 280.535.990
  • JUL/2010 = 364.384.664 (+29,9%)

General Air Crago (domestic + international, KG, JAN-JUL/2010)
  • JUL/2009 = 590.836.307
  • JUL/2010 = 680.709.560 (+15,2%)


Aircraft movement (landings + take offs, JAN-JUL/2010)
01. Guarulhos = 140.713 (+20,6%)
02. Congonhas = 117.460 (+7,0%)
03. Brasília = 99.973 (+8,5%)
04. Santos Dumont = 72.578 (+41,1%)
05. Campo de Marte = 69.824 (+20,2%)
06. Galeão = 68.872 (-1,1%)
07. Salvador = 63.951 (+8,2%)
08. Porto Alegre = 51.100 (+13,5%)
09. Curitiba = 49.785 (+13,9%)
10. Confins = 46.869 (+20,5%)
11. Recife = 43.002 (+13,4%)
12. Campinas = 41.486 (+45,5%)
13. Pampulha = 38.244 (+16,2%)
14. Goiânia = 35.494 (+20,0%)
15. Fortaleza = 35.373 (+21,9%)
16. Vitória = 30.900 (+6,1%)
17. Cuiabá = 30.013 (+21,0%)
18. Manaus = 28.906 (+12,5%)
19. Florianópolis = 24.866 (+6,3%)
20. Belém = 24.598 (+8,5%)
21. Natal = 15.697 (+20,3%)
22. São Luís = 12.505 (+14,7%)
23. Maceió = 11.965 (+42,8%)
24. Aracaju = 10.042 (+14,3%)
25. Teresina = 7.124 (+12,0%)

Domestic Passengers (JAN-JUL/2010)
01. Guarulhos = 9.137.253 (+26,0%)
02. Congonhas = 8.568.736 (+14,7%)
03. Brasília = 7.742.259 (+18,1%)
04. Galeão = 5.005.668 (-5,5%)
05. Santos Dumont = 4.293.642 (+62,7%)
06. Salvador = 4.030.402 (+6,8%)
07. Confins = 3.789.621 (+35,0%)
08. Porto Alegre = 3.383.527 (+17,0%)
09. Recife = 3.205.946 (+14,6%)
10. Curitiba = 3.029.898 (+17,5%)
11. Campinas = 2.894.024 (+80,3%)
12. Fortaleza = 2.699.638 (+24,2%)
13. Vitória = 1.438.605 (+10,0%)
14. Manaus = 1.391.073 (+17,7%)
15. Florianópolis = 1.375.855 (+25,1%)
16. Belém = 1.352.186 (+12,7%)
17. Natal = 1.284.668 (+29,6%)
18. Goiânia = 1.275.496 (+33,6%)
19. Cuiabá = 1.168.540 (+29,4%)
20. Maceió = 807.155 (+33,7%)
21. São Luís = 719.590 (+36,0%)
22. João Pessoa = 530.155 (+66,5%)
23. Aracaju = 522.849 (+30,9%)
24. Pampulha = 433.561 (+39,1%)
25. Teresina = 416.003 (+40,5%)

International Passengers (JAN-JUL/2010)
01. Guarulhos = 5.811.490 (+23,1%)
02. Galeão = 1.709.404 (+14,0%)
03. Porto Alegre = 252.941 (+27,0%)
04. Salvador = 199.902 (+3,8%)
05. Confins = 164.100 (+21,1%)
06. Florianópolis = 139.674 (+56,2%)
07. Fortaleza = 129.845 (+2,4%)
08. Recife = 128.966 (-0,8%)
09. Brasília = 103.466 (+3,9%)
10. Manaus = 91.260 (+11,3%)
11. Natal = 68.995 (-8,6%)
12. Curitiba = 57.193 (+3,3%)
13. Belém = 23.439 (+21,2%)
14. Maceió = 14.089 (+44,2%)
15. Campinas = 11.957 (+744,4%)

Passengers in General (domestic + international, JAN-JUL/2010)
01. Guarulhos = 14.948.743 (+24,8%)
02. Congonhas = 8.568.736 (+14,7%)
03. Brasília = 7.845.725 (+17,9%)
04. Galeão = 6.715.072 (-1,2%)
05. Santos Dumont = 4.293.642 (+62,7%)
06. Salvador = 4.230.304 (+6,7%)
07. Confins = 3.953.721 (+34,3%)
08. Porto Alegre = 3.636.468 (+17,7%)
09. Recife = 3.334.912 (+13,9%)
10. Curitiba = 3.087.091 (+17,2%)
11. Campinas = 2.905.981 (+80,8%)
12. Fortaleza = 2.829.483 (+23,0%)
13. Florianópolis = 1.515.529 (+27,4%)
14. Manaus = 1.482.333 (+17,2%)
15. Vitória = 1.438.605 (+10,0%)
16. Belém = 1.375.625 (+12,8%)
17. Natal = 1.353.663 (+26,9%)
18. Goiânia = 1.276.511 (+33,6%)
19. Cuiabá = 1.169.236 (+29,4%)
20. Maceió = 821.244 (+33,8%)
21. São Luís = 720.193 (+36,1%)
22. João Pessoa = 530.155 (+66,5%)
23. Aracaju = 522.849 (+30,9%)
24. Pampulha = 435.323 (+39,3%)
25. Teresina = 416.003 (+40,5%)

Domestic Air Crago (KG, JAN-JUL/2010)
01. Guarulhos = 77.696.220 (-2,8%)
02. Manaus = 51.327.602 (+13,6%)
03. Fortaleza = 24.166.119 (+39,1%)
04. Brasília = 23.987.902 (+22,3%)
05. Salvador = 18.592.272 (+19,5%)
06. Recife = 17.177.646 (-16,5%)
07. Congonhas = 15.327.573 (-2,1%)
08. Belém = 10.833.483 (+9,0%)
09. Galeão = 9.670.875 (-27,6%)
10. Porto Alegre = 8.775.719 (-15,9%)
11. Curitiba = 4.456.785 (+1,3%)
12. Confins = 4.029.435 (-45,6%)
13. Natal = 3.872.219 (-5,2%)
14. São Luís = 3.628.090 (+6,6%)
15. Goiânia = 3.376.533 (+2,0%)
16. Campinas = 3.168.926 (-42,0%)
17. Cuiabá = 3.016.357 (+14,4%)
18. Vitória = 2.769.894 (-2,6%)
19. Santos Dumont = 2.257.910 (+19,0%)
20. Teresina = 1.990.089 (+23,0%)

International Air Cargo (KG, JAN-JUL/2010)
01. Campinas = 143.569.110 (+51,0%)
02. Guarulhos = 125.403.813 (+13,4%)
03. Manaus = 35.090.702 (+69,3%)
04. Galeão = 33.219.590 (+9,6%)
05. Curitiba = 10.635.824 (+36,2%)
06. Salvador = 3.555.581 (-28,8%)
07. Confins = 2.678.119 (+29,4%)
08. Porto Alegre = 2.347.991 (+160,0%)
09. Recife = 2.277.708 (-26,1%)
10. Fortaleza = 1.780.632 (+87,2%)
11. Vitória = 1.517.779 (-0,5%)
12. Natal = 848.473 (+3,3%)
13. Petrolina = 638.241 (-15,4%)
14. Brasília = 504.610 (-10,5%)
15. Belém = 25.634 (-42,6%)

General Air Crago (domestic + international, KG, JAN-JUL/2010)
01. Guarulhos = 203.100.033 (+6,6%)
02. Campinas = 146.738.036 (+46,0%)
03. Manaus = 86.418.304 (+31,2%)
04. Galeão = 42.890.465 (-1,8%)
05. Fortaleza = 25.946.751 (+41,6%)
06. Brasília = 24.492.512 (+21,4%)
07. Salvador = 22.147.853 (+7,8%)
08. Recife = 19.455.354 (-17,7%)
09. Congonhas = 15.327.573 (-2,1%)
10. Curitiba = 15.092.609 (+23,7%)
11. Porto Alegre = 11.123.710 (-1,9%)
12. Belém = 10.859.117 (+8,8%)
13. Confins = 6.707.554 (-29,2%)
14. Natal = 4.720.692 (-3,8%)
15. Vitória = 4.287.673 (-1,9%)
16. São Luís = 3.628.090 (+6,6%)
17. Goiânia = 3.376.533 (+2,0%)
18. Cuiabá = 3.016.357 (+14,4%)
19. Santos Dumont = 2.257.910 (+19,0%)
20. Teresina = 1.990.089 (+23,0%)
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Old September 3rd, 2010, 03:41 PM   #366
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Brazilian minister defends merger of TAM, LAN airlines

14:14, September 03, 2010

Brazilian Finance Minister Guido Mantega said on Thursday the merger of Brazil's TAM and Chile's LAN airlines is legal, dispelling doubts on the approval of a plan to create Latin America's largest carrier.

TAM, the largest airline in Brazil, and LAN announced on Aug. 13 that they planned to create LATAM Airlines, which will become the largest airline in Latin America and the world's 11th in terms of carried passengers.

According to the Air Transport World, TAM carried 29 million passengers last year and LAN airline carried 15 million passengers.

"It is within the law, otherwise it would not have been made. LAN is powerful, strong, and TAM as well. I think it will be good," said Mantega.

The airlines said the LATAM group will provide flights to more than 115 destinations in 23 countries. It will have a total fleet of 241 aircraft and a combined workforce of 40,000 employees.

Since the Brazilian law limits the share of foreign airlines to 20 percent in the country, the two companies agreed to keep the Sao Paulo-based TAM controlling 80 percent of the voting shares. But LAN, based in Santiago, Chile, will have 70 percent of stake in the new company.

"I saw the legal structure and, according to what they showed me, they (LAN) will have only 20 percent here and will have equal control in the Council of the Holding abroad, even if LAN has more capital than the other (TAM)," the minister said.

The transaction is expected to reach 3.7 billion U.S. dollars. Shareholders will receive 0.9 common stock of LATAM for each share of TAM after TAM is delisted from the Sao Paulo exchange.

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Old September 10th, 2010, 06:22 AM   #367
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All the brazilian airlines are increasing its operations in Confins, they will need a second terminal soon!
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Old September 10th, 2010, 10:32 PM   #368
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IBERIA requires new international route connecting Brazil and Europe

Madri/MAD - Fortaleza/FOR - Recife/REC - Madri/MAD

Iberia has requested to the Brazilian Air Authority, ANAC, its first flight to Brazil out of Rio de Janeiro and Sao Paulo. It will be a triangular flight conecting Madri to Fortaleza and Recife, flying with the Airbus A340-300.

The flight is initially scheduled to operate on Tuesdays, Fridays and Sundays. The aircraft will land in Fortaleza at 17:25, taking off from there at 18:45 to land in Recife at 20:15. And from Recife, the final leg departs at 21:55 inbound to Madrid.

IBE 6031 A343 -T--F-S LEMD SBFZ 0905 1725
IBE 6031 A343 -T--F-S SBFZ SBRF 1845 2015
IBE 6032 A343 -T--F-S SBRF LEMD 2155 0605


Service will beging on 10-11/Feb/2011


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Old September 18th, 2010, 01:06 AM   #369
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Transaero Airlines to Launch Scheulded Air Service Moscow - Rio de Janeiro

Transaero Airlines will launch the scheduled non-stop air service on the route Moscow - Rio de Janiero - Moscow in 2011.

The program will be launched on January 3, 2011. The flights will be provided once a week from Moscow Domodedovo International Airport deploying Boeing 747-400 with three class configuration which can handle 352 people. The configurations include Imperial (11 seats), Business (56 seats) and Economy (285 seats).

It will take 12.5 hours to get from Moscow to Rio de Janiero traveling with Transaero. The airline has already received all necessary permissions from the Russian authorities to provide the flights on the route Moscow - Rio de Janiero. Transaero is currently getting the permissions from Brazil.

Launching the flights from Moscow to Rio de Janiero will be a landmark event for Transaero in 2011.

Source: Russian Transport Daily Report

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Old September 18th, 2010, 04:20 AM   #370
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Few weeks ago that Singapore Airlines route SIN-BCN-GRU had approved by Spain goverment, but with codeshare with spanair.

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Old September 18th, 2010, 06:15 PM   #371
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Originally Posted by littlearea View Post
Few weeks ago that Singapore Airlines route SIN-BCN-GRU had approved by Spain goverment, but with codeshare with spanair.

True! Another new intl route connecting Brazil to the world. This one possibly flying the B77W.

Spain nad Brazil connection gaining two new routes (MAD-FOR-REC-MAD & SIN-BCN-GRU).

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Old September 20th, 2010, 01:18 AM   #372
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Brazils' technological innovation

Updated: 13:12, Sunday September 19, 2010

Brazil is seeking a foothold in the high-tech industry with a state-funded startup company, Ceitec, that will produce the country's first domestically designed microchip.

The country hopes that spurring its electronics industry will help it innovate new technology for other parts of its sprawling economy that include commodities, mining, biofuels, and deep-water oil exploration.

The following are some of Brazil's principal innovations:

FLEX-FUEL ENGINES: This Brazilian-designed technology allows vehicles to run on any mix of gasoline and ethanol, the first of its kind when it was launched in 2004.

It has been a key factor in the massive growth of Brazilian sugar-cane ethanol, which is one of the country's major exports and has reduced its dependence on fossil fuels.

DEEP-WATER DRILLING: Brazilian state-oil company Petrobras in the last ten years has become a global pioneer in deep water oil and gas production in part because of its own technological innovation that includes offshore oil production equipment.

The company has also developed new ways to use vegetable-based oils in petroleum refineries for the production of diesel.

ETHANOL-POWERED PLANES: Brazilian airline-maker Embraer in 2004 year deployed the world's first airplane powered by ethanol.

The company says the 'Ipanema' cropduster, first introduced in the 1970s and later outfitted for biofuels, lowers costs for agroindustries that use them, while reducing carbon emissions.

MINING: Brazilian mining giant Vale, the world's largest iron ore miner, this year patented technology that to process ore without using water. This lowers costs both of operations and of managing leftover mineral 'tailings.'

Vale, which is Brazil's largest consumer of energy, also created the world's first train powered by natural gas. The country uses trains to transport millions of tonnes of iron ore each year from mines to ports.
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Old September 27th, 2010, 02:26 PM   #373
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Official Press Release:

AZ 672 FCO GIG 22:30 05:40 (-2--567)
AZ 673 GIG FCO 14:45 07:10 (1-3--67)

Effective from 04/Jun/2011



Alitalia ready to return to Rio de Janeiro

Published: Friday, September 24, 2010 by deborab

Alitalia is ready to return to Rio de Janeiro, is what emerged this week when former national airline took stock of the situation on the South American market, where it has links to and from São Paulo, Buenos Aires and Caracas.

From 4 June 2011, an Airbus A330 will fly on the route weblog Alitalia Rome Fiumicino - Rio de Janeiro, three times a week, four from June 28. Departures from Heathrow at 22:30 and 14:45 to Rio.



Alitalia saling tickets Rome-Rio de Janeiro

Monday, September 27, 2010

Tickets are on sale for the new Rome-Rio de Janeiro, which will start on June 4 next year and that adds to the flight on the Sao Paulo already operated by Alitalia. This new route will have three flights per week throughout June and July the weekly frequencies will become four. The departure from Rome Fiumicino airport is at 22:30 with arrival in Rio de Janeiro at 5:40 local. From Rio de Janeiro is taking off at 14:45 local landing in Rome Fiumicino airport is at 7.10. The flight Rome-Rio de Janeiro will be made with one of the new Airbus A330 that will enter the fleet over the next year.


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Old September 28th, 2010, 02:42 PM   #374
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Monday, September 27, 2010

LAN-TAM: Unrecedented Merger

The unprecedented merger of Chile’s LAN and Brazil’s TAM transforms Latin American aviation.

[email protected]

For years, Chile’s LAN Airlines and Brazil’s TAM Airlines have been two of the biggest, most important foreign airlines that went largely unrecognized among air travelers in North America. Now the merger of the two airlines, announced on August 13, could help carry the two South American carriers squarely into the spotlight. The deal would create a mega-airline with an impressive market capitalization of around $13.2 billion as of mid-September, far exceeding the current US$6.6 billion in combined market capitalization of United Airlines and Continental Air, the two U.S.-based giants planning to merge by the end of this year.

Stock market observers see these figures as a notable reflection of the appreciation of South American equities on global markets. While the combined market capitalization of LAN and TAM was about double that of the two U.S.-based air giants last year, the South American airlines’ combined revenues of $8.5 billion were far lower than the combined US$29 billion recorded by United and Continental last year. LAN and TAM carried a combined 45.8 million passengers last year, which would have ranked them a combined 11th in the world. In terms of available seat kilometers, LAN and TAM, if combined, would currently account for over 40% of Latin America's capacity and offer the second-largest capacity on routes to the United States and Canada after only American Airlines.

Much remains to be resolved in this merger of South American aviation giants, however. If the two airlines continue to operate under their own brands, will the character suffer from a lack of consistency? Will the leadership of the new airline be able to achieve the synergies and cost savings that motivate today’s trans-national mega-mergers? Which worldwide airline alliance – Oneworld or Star Alliance – will the new airline belong to? LAN belongs to Oneworld, while TAM belongs to Star Alliance. Over the long term, what will the merger portend for the much smaller, regional airlines that compete for market share on the fast- growing South American continent?

“This is a merger, not an acquisition, and it is unprecedented,” says Felipe Monteiro, a professor of management at Wharton. In recent years, Monteiro notes, “it has become normal for Brazilian companies to buy smaller companies but less usual for players to join forces. This [deal] involves two large Latin American airlines with very important operations.” Brazilian companies have acquired smaller firms in sectors such as beverages, power, telecommunications and financial services. Recent important deals include the merger of the banks Itaú and Unibanco; the takeover by Perdigao, Brazil’s largest food company, of its rival Sadia; the foreign acquisitions made by Brazilian food processors JBS and Marfrig; the merger of Brazilian brewers Brahma and Antarctica, which created AmBev, which then merged with the Belgian company Interbrew, creating InBev, and the recent purchase of Burger King by 3G Capital, a Brazilian firm.

The new South American airline will dwarf in size such smaller players as Brazil’s Gol, Colombia’s Avianca and Argentina’s Aerolineas Argentinas. Monteiro suggests that the TAM-LAN deal is much more akin to the high-value consolidation that has been taking place elsewhere in the aviation world, including the pending merger of United and Continental and recent capital ties established between KLM-Air France and privately owned Alitalia.

Monteiro adds that a key reason for the TAM-LAN merger is that Brazil restricts foreign ownership in a Brazilian air carrier to just 20%. “This is a very regulated market,” in which it would otherwise be very hard for foreign players like LAN to play a major role. “There will be discussions in the Brazilian congress about changing this [restriction] to 49%,” notes Monteiro. The new company will have to find ways to respect the foreign participation laws in each country, he points out. The new airline “will be scrutinized by governments in both Chile and Brazil. Everyone knows that if you want to be an important player in this industry, it is very hard to be a purely local player.”

Capturing the Public’s Imagination

This deal “has captured people’s imagination because of its huge scale,” says Mauro Guillén, a Wharton management professor and director of Wharton’s Joseph H. Lauder Institute of Management & International Studies. “It is a major event for emerging economies. I am optimistic. It makes all the sense in the world.”

The merger is important, notes Guillén, not only because of its own scale but because of what it portends for other cross-national mergers in Latin America. “There will be other mergers” in various sectors in Latin America, “and they will get bigger and bigger.”

But does the merger make business sense? According to Germano Glufke Reis, lecturer at the Getulio Vargas Foundation/EAESP (Sao Paulo Business School) in Brazil, “This merger has a very clear set of motivators: The opportunity to create synergies and to improve operational efficiency; gains related to scale, and the fact that it creates entry barriers to foreign airline companies.” Reis adds, “In Brazil, airlines have experienced an extremely competitive industry, a hard price-based competition. Small companies with regional routes already hold a 19% market share and foreign companies have operated with low prices in Brazil. On the other hand, the increase in the purchasing power of the population has increased ticket sales. Never before in Brazil have people traveled abroad so much as currently. Airline industry growth has been at a rate of 13%, or double the growth rate of the gross domestic product [GDP)].”

The timing of the merger is also critical. Brazil is preparing to host both the next World Cup in 2014 and the Summer Olympic Games in 2016, and “that means investments in airport infrastructure and creation of new business opportunities,” notes Reis. For both major events, South America’s new mega-airline will play a role that “is less symbolic and more operational,” says Monteiro. “The air traffic infrastructure for these big events will become a major issue with an unprecedented volume of traffic,” highlighting the need for smooth functioning of South America’s transportation connections with the rest of the world. These events can be a “make or break” moment for the new airline to prove to the world that it is a major-league player worth remembering. “It is very important to have an airline big enough to deal with these issues,” suggests Monteiro. Through its various branches throughout South America, “LAN has a really good network” for handling traffic in Latin America and the U.S. “while TAM’s strengths are its connections to Europe. Now they will really be able to combine the two networks,” adds Monteiro.

LAN Takes the Lead?

Of the two airlines, LAN has the upper hand in taking the lead role in the new air carrier because the Chilean airline “is extremely well managed,” Guillén notes. “LAN has new planes and excellent services and good on-time performance. They seem to know how to make money in the industry and they are expanding…. They are better run.”

When it comes to financial performance, there is a striking contrast in the two airlines’ recent histories. In terms of revenue, TAM is significantly larger than LAN. In 2009, TAM’s revenue was US$9.8 billion, versus only $3.52 billion for LAN. Meanwhile TAM’s earnings per share were US$2.90, versus US$0.68 for LAN. But LAN’s market capitalization, as of mid-September, was nearly three times – US$9.85 billion – that of TAM, which was US$3.38 billion. While TAM’s share price has fluctuated wildly since 2005 -- from a high of US$36 in 2007 to a low of US$5 in 2009, to about US$21 this summer – LAN’s shares have more than quadrupled in value over the past two years, from a low of US$7 in 2009 to about US$30 today.

Just before the merger was announced, LAN reported that its passenger traffic rose 13.7% in August from a year earlier, after gaining 14.5% in July. LAN said the increase was due to a 15.1% jump in domestic passenger traffic in Argentina, Chile, Peru and Ecuador. According to LAN officials, a greater presence in its U.S. operations helped boost international traffic by 13.1%. LAN's cargo operations rose 16% in August because imports recovered in Latin America, especially in Brazil, and activity grew in Europe, the company said. The airline's load factor grew 1.3% to 77.8%. Just days before the merger was announced, TAM announced a US$88 million second-quarter net loss, generated by major losses in its fuel hedging strategy. However, TAM’s second-quarter revenue rose to $1.457 billion, compared with $1.14 billion a year earlier.

Under the proposed arrangement of the merger, LAN Airlines would change its name to LATAM Airlines Group and become the holding company for the two airlines and their subsidiaries. Yet LAN and TAM would preserve their traditional brands and continue to be headquartered in Santiago, Chile and São Paulo, Brazil, respectively. The choice of LAN head Enrique Cueto as the CEO of the new company, says Reis, “suggests that there will a common direction to both companies ... distinct identities with a single management model.”

To implement the merger, LAN Airlines would issue new shares. Shareholders in TAM would receive 0.9 shares in LATAM for each TAM share. Thus, LAN's existing shareholders would hold an estimated total of 71% of LATAM, headed by the controlling Cueto family with approximately 24% of LATAM. TAM’s controlling Amaro family would have around a 14% stake in the new company. However, under a shareholders' agreement, control of the merged operation would be shared by the Cueto and Amaro families, each with an equal (but yet to be defined) number of directors on LATAM's nine-seat board. “Both TAM and LAN are companies that have family origins,” notes Monteiro. “A major challenge will be “how well the controlling families will work together.” The two sides will have to decide whether the new airline will have a distinctively South American flavor; or have a flavor – either Chilean or Brazilian – that is more in tune with one of the two partners.

By the terms of LAN's statutes, the merger will require approval of two-thirds of its shareholders; the Cueto family, although the largest single shareholder, controls only 34%. For shareholders of TAM -- in which the Amaro family holds a 48% stake -- the proposed share swap would reportedly provide an attractive premium over the company's current market value.

Commonalities and Complexities

Another challenge involves the personal relationships between the largest shareholders in the two companies, says Reis. That is to say, “How to achieve the necessary alignment between the Amaro and Cueto families in the management of this new giant of the airline sector and how to preserve this alignment over time.”

Even though both companies are located in Latin America, “Chile and Brazil have many differences regarding geography, history, institutions, culture, and so on,” notes Reis. “It is also important to observe that mergers are not the preferred entry mode of Brazilian companies when they expand internationally.” On the contrary, Reis suggests, Brazilian companies prefer to make acquisitions of foreign companies because their management style typically seeks to minimize risks and to grant control to the managers of their foreign-based operations. “This cultural trait tends to reduce interest in strategic alliances and mergers,” Reis points out. “However, learning through internationalization, Brazilian firms have started to experience alternative approaches.”

Despite such complexities, notes Guillén, “there are no big competition issues here because these two airlines operate in different parts of Latin America. Customers won’t be hurt, and they may get more choice” as a result of the merger. “To the extent that they have more integrated services, this will help travelers,” he says.

Another positive, Reis says, is that both partners are modern companies that “have truly professional management models, and have advanced fleets and technologies, besides having a well-prepared team. They have a lot of experience in performing in partnership and alliances. LAN has subsidiaries in other countries and partnership with foreign companies. So LAN and TAM have both capabilities and competencies that will surely ease the management of their cultural alignment and the gradual construction of a common identity” to the extent that it might be required.

Republished with permission from http://www.knowledge.wharton.upenn.edu -- the online research and business analysis journal of the Wharton School of the University of Pennsylvania.
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Old September 29th, 2010, 01:59 PM   #375
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Source: Fórum Contato Radar, member: PP-CJC

29/Sep/2010, 06:39 AM (GMT -3)

TAM Network > New International Flights: BSB-MIA + CNF-MIA)

Under request, to include TAM's new flight by phases.

Effective > 01/Dec/2010 > New flights in analysis.

JJ 8042 Mon, Wed, Fri, Sun > BSB 22h25 - MIA 06h30 > B763
JJ 8043 Mon, Wed, Fri, Sun > MIA 13h00 - BSB 20h20 > B763

JJ 8058 Tue, Thu, Sat > CNF 22h30 - MIA 06h30 > B763
JJ 8059 Tue, Thu, Sat > MIA 13h00 - CNF 21h00 > B763

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Old October 2nd, 2010, 02:52 AM   #376
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Related News: Latin America

Gol May Boost Boeing Orders on Brazil Boom, World Cup

By Laura Price - Sep 30, 2010 5:31 PM GMT-0300

Gol Linhas Aereas Inteligentes SA, South America’s second-biggest airline, may buy more Boeing Co. 737 planes to meet demand spurred by Brazilian economic growth and an influx of visitors for the World Cup and Olympics.

Gol, based in Sao Paulo, will review fleet requirements in coming months and could sell shares or raise debt in the second half of next year to fund the purchases, Chief Financial Officer Leonardo Pereira said yesterday in an interview in London.

The Brazilian economy, Latin America’s largest, will grow 7.5 percent this year, according to economists in a Sept. 27 central bank survey. Gol based its current fleet plan on growth of 4 percent over the next five years, Pereira said, adding that extra planes would add seats in time for Brazil’s 2014 World Cup soccer tournament and the 2016 Olympic Games in Rio de Janeiro.

“If Brazil continues to grow at a faster pace than we thought, we’ll have to review our fleet plan,” Pereira said at London’s Heathrow airport, where he spoke at a low-cost airline conference. “2014 adds an additional component to this review, because 2014 and 2016 are going to be big events. And if you want to order a plane for 2014, you have to do it today.”

Gol has ordered a total of 127 Boeing 737 Next Generation jetliners since 2004 and is due to increase the fleet by three or four planes a year until the deliveries are complete by 2016, according to Pereira. The carrier also has options to purchase 40 more 737s and these could be converted to firm contracts if it decides to boost the fleet further.

Shares or Debt

“If we have an accelerated growth plan, one of the things we might consider would be selling shares,” the CFO said. “We’ll start receiving new planes at the middle or end of 2011, so any sale of debt or shares would be mid-2011 and not before.”

Gol was founded in 2001 and acquired unprofitable rival Varig, once Brazil’s biggest airline, in 2007. Tam SA, the country’s current No. 1, agreed to be bought by Lan Airlines SA of Chile on Aug. 13.

Gol fell 1.4 percent to 25.95 reais at the close of trading in Sao Paulo at 4 p.m. New York time.

The stock has risen 10 percent since the day before Lan agreed to buy Tam, a move Pereira said isn’t a “threat,” because Gol is focused more on domestic and regional services than on international routes.

‘Rational Player’

Lan is also “very conscious” of its high margins, with an operating profit last year equal to 13 percent of sales, and won’t want to flood the market with capacity, the finance chief said. Neither is the Chilean carrier likely to risk undermining its investment grade BBB credit ranking from Fitch Ratings.

“It’s probably going to be healthy for the industry in Brazil,” he said. “Most likely, they will be a rational player.”

Pereira said Gol isn’t planning to join an alliance in the near future, though with Lan a member of Oneworld and Tam in rival Star, one of the groupings will lose its South American representative when the merger is completed.

“If there are advantages in joining an alliance a couple of years down the line, we may consider it,” he said, “But today our model is to build this portfolio of bilateral agreements.”

Aerolineas Argentinas SA will sign up to the SkyTeam group this year, two people with knowledge of the agreement said this month. That may compromise Gol’s relationship with SkyTeam members Air France-KLM Group and Delta Air Lines Inc., two of the six carriers with which the company has bilateral alliances.

To contact the reporter on this story: Laura Price in London at [email protected]

To contact the editor responsible for this story: Kenneth Wong at [email protected]
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Old October 7th, 2010, 01:12 AM   #377
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Brazil to decide fighter jet buy after election: minister

Brazil is going to wait until after presidential elections conclude at the end of this month to decide a long-delayed multi-billion-dollar purchase of new fighter jets, Defense Minister Nelson Jobim said Wednesday.

Outgoing President Luiz Inacio Lula da Silva needs to discuss the matter with whoever is elected to succeed him in an October 31 runoff, Jobim told a seminar of senior military officers and private sector defense contractors in Sao Paulo.

"When the second round is over we are going to examine the issue of the F-X," he said, referring to the code of the tender to supply Brazil's air force with 36 modern fighters.

"The execution of the FX will be in under the new government, and so the president needs to speak with the new president-elect about the FX," he said.

Three finalists are battling it out for the Brazilian contract, which is worth an estimated four billion to seven billion dollars.

France's Rafale made by Dassault was seen leading the race against Sweden's Gripen NG by Saab and the F/A-18 Super Hornet manufactured by US giant Boeing ever since Lula last year said it was his preferred choice.

But the French bid's prospects have faded as Brazil's electoral calendar has taken over, and after the air force made clear through leaks to the media that it preferred the cheaper Swedish jet.

Brazil, which has an option to increase the purchase by up to another 100 aircraft, is insisting that the deal involve a transfer of technology so it can build up its own aviation sector.

Lula's chosen candidate, Dilma Rousseff, his former cabinet chief, currently leads the race for the presidency, with a solid lead over challenger Jose Serra, the former governor of Sao Paulo state.

© 2010 AFP
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Old October 8th, 2010, 02:18 PM   #378
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OCTOBER 6, 2010, 2:59 P.M. ET

Brazil's GOL Doesn't See Benefit Of Joining Global Alliance

By Stephen Wisnefski

NEW YORK (Dow Jones)--Brazilian airline GOL Linhas Aereas Inteligentes SA (GOL, GOLL4.BR) isn't interested in joining one of the major global alliances, instead focusing on a patchwork of code-sharing arrangements with airlines around the globe, company executives said Wednesday.

"As we are not flying long-haul flights, we don't need support from a global alliance in the foreign destination," Chief Executive Constantino de Oliveira Jr. said in an interview with Dow Jones and Wall Street Journal editors.

Oliveira noted that the code-sharing agreements provide the international partners with a broad network of flights within Brazil, driving additional traffic to an airline that has focused almost exclusively on growing its domestic business in the booming Brazilian market. "We can support [other airlines] in Brazil. But we don't need their support, we don't use their support, outside of Brazil."

GOL, a budget airline that was established in 2001 and has rapidly risen to become Brazil's second-largest carrier, has signed code-sharing deals with AMR Corp.'s (AMR) American Airlines, Delta Air Lines Inc. (DAL) and Air France-KLM (AF.FR) in recent years, among others.

The Sao Paulo-based company plans to expand those bilateral agreements over the next year, with partnerships likely to be announced with airlines in Asia and the Middle East, Chief Financial Officer Leonardo Pereira said.

So far, customers of Gol's international partners are able to book tickets for their entire trip--including the flight into the country and the connecting flight on a Gol aircraft--through a single process. Gol's customers based in Brazil, however, have to buy separate tickets for a similar trip involving one of the international carriers.

Oliveira said that Gol aims to upgrade its reservation system to allow for truly reciprocal code-sharing arrangements, but the airline is developing a system that will be more cost-effective than traditional global distribution systems.

The issue of whether GOL will join one of the major global alliances has come into sharper focus since Chile's Lan Airline (LFL, LAN.SN), a member of the Oneworld Alliance, and Tam SA (TAM, TAMM4.BR), Brazil's largest airline and a member of the Star Alliance, announced plans to merge.

Oliveria noted that Tam and Lan--to be called LATAM--are creating a huge company in the region, but that GOL maintains its competitive advantage thanks to its low-cost model and domestic-route focus.

As GOL works to improve its business model, it is looking at ways to boost ancillary revenues. The company, which typically only serves water and peanuts on flights, has started offering food for a charge on about 50 flights. The executives said the service has been well-received, and that it will expand it to about 500 flights per day--out of the total 900 flights the company flies--by the first quarter of next year.

GOL also plans to launch by the end of October a new entertainment service that will enable customers to access a range of content, provided by GOL partners, on their mobile devices during flights. The content won't be live, but will be uploaded to the aircraft server just before take-off.

Oliveira said that GOL will provide the service free-of-charge, but eventually hopes to generate revenue through sales to sponsors. The CEO acknowledged that the service, which he said is the first of its kind, isn't as good as WiFi Internet, but is more cost-effective.

Meantime, the company continues its efforts to deleverage. Pereira, the CFO, said GOL has no plans to issue new debt. The company issued $300 million in bonds in July, which Pereira said eliminated refinancing risk for the next three years.

-By Stephen Wisnefski, Dow Jones Newswires; 212-416-2191; [email protected]
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Old October 9th, 2010, 02:35 AM   #379
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Brazil hopes China will okay bigger Embraer planes

(AFP) – 3 hours ago

BRASILIA — Brazil remains hopeful that Beijing will give aeronautics firm Embraer the nod to build bigger passenger planes in China, the office of President Luiz Inacio Lula da Silva said Friday.

Embraer currently makes a 50-seat commercial jet in China with Aviation Industries of China (AVIC), and wants to build a 120-seat model but has not been able to get a permit from the government.

Lula has sent Chinese authorities two letters, one at the end of 2009 and the other in May of this year, pressing for the permits, an official in his office told AFP.

"The response was that it's still being analyzed," the official said.

Embraer's executive vice president, Paulo Souza y Silva, was quoted in O Estado de Sao Paulo Friday as saying that the Chinese wanted to build their own larger passenger planes and saw the Brazilians as competitors.

The company issued a curt statement saying there was "no decision so far" to close the factory in China -- a worst case scenario mentioned by the newspaper -- and that it remained in negotiations with the Chinese government and its associates "with a view to continuing operations."

Embraer is the world's number three maker of commercial aircraft, after US giant Boeing and its European rival Airbus.

The Brazilian company racked up 7.9 billion dollars in contracts in July at the Farnborough International Air Show in Britain.

Copyright © 2010 AFP. All rights reserved.
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Old October 13th, 2010, 01:57 PM   #380
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First Phenom 300 Delivered in South America

October 13, 2010
Business Aviation Aircraft

Embraer's first South African customer for a Phenom 300 light jet, John McCormick, CEO of McCormick Property Developments, took delivery of his airplane last month during a ceremony at the manufacturer's headquarters in São José dos Campos, Brazil, just a few months after the first Phenom 100 entered operation in South Africa.

The Phenom 300 entered service in December 2009, after winning certification from the Brazilian civil aviation authority ANAC and the FAA. This year, EASA issued its type certification for the jet, and, in July, the South African Civil Aviation Authority issued its approval.

The airplane holds up to 11 occupants in a cabin designed in partnership with BMW Group DesignworksUSA. Some of the airplane's distinctive features include a single refueling port, externally serviced lavatory and short runway capability. One of the fastest jets in the light jet category, the Phenom 300 can fly 453 knots ktas at up to 45,000 feet. Its range of 1,971 nm (NBAA IFR reserves) gives the Phenom 300 the ability to fly nonstop from Cape Town to Luanda, Angola; from London to Athens; from Delhi to Dubai and from Brasilia to Buenos Aires.

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