TAM believes demand for Brazil flights remains high in 2012

São Paulo, Brazil – TAM Airlines expects to see load factors of between 83 and 85 percent on its international flights during 2012.

São Paulo, Brazil – TAM Airlines expects to see load factors of between 83 and 85 percent on its international flights during 2012. TAM believes that demand for flights from and to Brazil will remain high during 2012, especially because of the country’s current economic strength and growth. In 2011 TAM reported its best ever load factors on international routes, 81.4 percent.

The company’s seat offer should increase between 1 and 3 percent on its international routes in 2012. TAM does not expect to open any new routes during the year, but it will be working to consolidate and increase load factors and productivity on existing services, and also increase frequencies on some these routes.

For the Brazilian domestic market, the airline estimates growth in 2012 of between 8 and 11 percent in the demand for flights. The commercial aviation market should remain strong this year in Brazil, in line with the increase in the Brazilian Gross Domestic Product (GDP) and new passengers; passengers who will continue to migrate to flying from the more traditional road trips by bus and car.

“We believe in a strong and expanding market in 2012. We will focus our efforts on increasing the company’s profitability, while continuing the yield recovery that started in the second half of 2011. We will keep a strict control of costs, avoiding overcapacity, and increasing revenues with higher load factors,” states Líbano Barroso, president of TAM Airlines.

The company expects to close the year with an average load factor of 72 to 74 percent on the domestic Brazilian services, with a continuing increase in the number of passengers. To capture the new domestic demand, TAM will continue to invest to meet all market segments, particularly retail.

Seat offer on domestic Brazilian services should increase between zero and 2 percent in 2012. Besides the revision to its fleet plan announced in August 2011, TAM expects to now end 2012 with 157 aircraft, instead of 159.

In August 2011, TAM changed its narrow body fleet plan for 2012 from an increase of four aircraft to maintain the same number as in 2011 (127 aircraft). The company will now make a reduction of three aircraft, ending the year with a domestic fleet of 124 aircraft. Nevertheless, 10% of the domestic fleet will be renewed in 2012 with the arrival of 13 new Airbus A320s. These new aircraft will help to maintain the low average age of the fleet.

For the international market, the company will receive four Boeing 777s, while an Airbus A330 that was to have been returned in 2012, will now continue in the fleet. TAM is currently deciding on the routes that these aircraft will operate, which will not be new destinations, but on existing routes where they will help to increase frequency or capacity.

The estimates for 2012 will be adjusted periodically depending on changes to market, macroeconomic and internal conditions.

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