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Cargo and Foreign Routes Bring Brazil’s TAM 10% Boost in Revenues

Brazilian airlines Tam and Gol Brazil's flagship airline TAM ended last year with a 10% increase in gross revenues, which totaled 8.5 billion reais (US$ 4.8 billion). In the year before last, the company posted revenues of 7.7 billion reais (US$ 4.4 billion).

Performance last year was boosted by the expansion in international passenger and cargo. Revenues from foreign passengers increased 38.5% to stand at 2.1 billion reais (US$ 1.2 billion), and revenues from cargo rose 153%, totaling 417 million reais (US$ 238 million).

In the domestic market, revenues from passengers decreased 6.4%, to 4.8 billion reais (US$ 2.7 billion), and revenues from cargo grew 11.9%, to 360 million reais (US$ 136 million). Number of passengers in domestic flights rose 7.2%, totaling 24.1 million, and in international flights it grew 48.7%, to reach 3.7 million.

"It has been a very significant year for our international operations. We invested in new routes that are posting good results. Besides, we have signed strategic code-share agreements with leading companies in Europe, the United States and South America," says the president at TAM, commander David Barioni Neto.

The company posted a net profit of 128.8 million. The airline ended the year of 2007 with a fleet of 115 aircraft. TAM plans on closing 2008 with 123 aircraft in operation, including 4 Boeing B777-300ER and 119 Airbuses.

The company also has a firm order backlog of 89 new aircraft, scheduled for delivery from 2008 to 2018.

Varig's New Flights

Varig, the once Brazil's flagship airline that was bought by Gol, has a new network of domestic flights. The changes, which were initiated to broaden the company's presence in high traffic business markets, should improve the company's connectivity and distribution to several national destinations.

Planning for the new network included the recent lift of previous restrictions on connecting flights to Congonhas Airport, in São Paulo. From this airport, Varig will serve Belo Horizonte (Confins), Brasí­lia, Curitiba, Florianópolis, Porto Alegre, Recife, Rio de Janeiro (Galeão and Santos Dumont) and Salvador.

The most significant change is the creation of a distribution hub in Brasí­lia. Customers can now fly to Belo Horizonte (Confins), Fortaleza, Manaus, Porto Alegre, Recife, Rio de Janeiro (Galeão), São Paulo (Congonhas) and Salvador in direct flights from the federal capital.

The number of flights to these destinations was also increased. Flights to Salvador, for example, now include three frequencies from Brasí­lia, two from Rio de Janeiro (Galeão) and three from São Paulo (Congonhas).

"With the new hub in Brasí­lia and the return of connections to Congonhas, Varig will be able to offer more flight options to several destinations. The company is growing and gaining a wider national route network," says Lincoln Amano, Varig's commercial director.

"The new network will allow Varig to increase aircraft utilization, productivity, efficiency, and flight loads in an intelligent way. Most importantly, it will allow Varig to broaden its customer services."

Operations to Brasilia and from Congonhas will primarily be carried out by Boeing 737-700 and 737-800 Next Generation aircraft, which have the largest space between seats in the Brazilian domestic market.

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