Brazilian airline VASP says the country's other three major carriers have snubbed its proposal to create a single holding company. An offer from Brazil's development bank to finance a merger between the struggling airlines also continues to be rejected.
At the start of the month, Varig, Transbrasil and TAM Brazil took out an advertisement in the country's leading newspapers denying interest in VASP's proposals.
"There is not and never has been any commitment to the idea of creating a holding company for Brazilian airlines," it read.
VASP president Wagner Canhedo put forward the idea at a recent meeting of airline chiefs in Brasilia. He suggested the name Air Latina on the basis that three of the companies have stakes in other Latin airlines - VASP owns Bolivian carrier LAB, as well as Ecuatoriana and the Argentine regional Tansa, while Varig owns Uruguay's Pluna and TAM owns Paraguayan Transportes Aereas do Mercosur.
"Unfortunately the proposal was not well received by the other airlines, but we are still open to talks," says VASP.
While the airlines seek to hold on to their independence, most local observers agree that some sort of change is essential to help the beleaguered carriers through a bleak period which began in January with the collapse of Brazil's currency. All four have been operating in the red this year as demand has slumped and costs have risen, leading to doubts as to whether they can all survive.
The airlines hold differing views on how to overcome the problem. Varig president Fernando Pinto says his airline should be left to fly international routes, a monopoly it held until the late 1980s, and that its rivals should concentrate on the domestic market. "It is not necessary to have more than one of our companies flying outside Brazil. But in Brazil, we need competition," he says.
Source: Flight International
