LATAM Airlines Brazil is significantly cutting capacity in its economically troubled home country, but is optimistic that corporate travel could recover quickly once the government stabilises.

"We don't see any strengthening in the short run," the airline's chief executive Claudia Sender tells Flightglobal.

LATAM Airlines Brazil will cut domestic capacity by 10% to 12% in 2016, more than the initially planned cut of 8% to 10%.

Last month, Brazil's president Dilma Rousseff was suspended on corruption allegations. While she faces impeachment charges, an interim government is in charge.

Sender believes that corporate travel could recover quickly once the government stabilises, even if the economy does not catch up as quickly.

While the airline has cut capacity at home as well as on flights to the USA, other international routes face better prospects. The carrier will begin nonstop service to Johannesburg in October, adding LATAM Airlines Group's first route to Africa.

Besides capacity adjustments, LATAM has also announced plans to defer aircraft to reduce its fleet expenditures. Sender says a combined fleet plan among the group's carriers has given the airlines flexibility, especially in light of the Brazil economic situation.

"It has given us a competitive advantage. We can move the fleet and we are in a better position to negotiate," she says.

Source: Cirium Dashboard