Falling revenues may force Brazilian airline Varig to cut its fleet by 30%, but negotiations with aircraft lessor GE Capital Aviation Services have been bogged down. Varig plans to return 12-14 of its GECAS aircraft, but has not agreed on leasing terms for the remaining 18 Boeing 737s.
Airline sources indicate the aircraft could be repossessed by the end of November unless agreement is reached.
Load factors on US routes have fallen 35%, leading Varig to suspend its daily Rio de Janeiro-Miami flights. But, Varig says, "we feel there will be a recovery on US routes by 10 December".
Source: Flight International
