LATAM Airlines Group will lose money during the FIFA World Cup which starts in Brazil this month, says chief executive of Enrique Cueto.
He declines to say how much he expects the group, which includes Brazil’s largest carrier TAM, will lose but cites the fact that the country will be in a veritable “country holiday” during the games. The World Cup kicks off on 12 June, with matches spread throughout Brazil over the following month.
“There’s huge reductions in business travellers,” says Marco Antonio Bologna, president of TAM Holdings. These travellers will either be home “watching the World Cup” or out of the country during the month of matches.
Despite the expected downturn in business traffic, TAM, as well as Avianca Brazil, Azul and Gol, all plan to run extra flights during the event.
Brazilian aviation regulator, ANAC, has approved at least 1,970 additional flights during the World Cup but also imposed steep penalties for airlines and airport operators for slot violations from the beginning of June to the end of July.
New terminals have opened at the Brasilia, Campinas-Viracopos, Natal and Sao Paulo Guarulhos airports in time for the World Cup. These facilities are expected to help manage a jump in overall traffic that is expected during the event.
“We don’t have the ideal solution to be ready before the World Cup,” says Bologna on Brazil’s infrastructure investments. He does not expect airport capacity issues to be a big issue but says urban mobility is a “separate issue”.
Cueto has fewer concerns with the Rio Olympics in 2016.“It’s easier,” he says. “It’s [only] in one city.”