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TAM expects Star to generate $60m in additional revenues

Brazil's TAM expects its membership in Star Alliance to generate at least $60 million in additional annual revenues.

TAM CEO Libano Barroso says the revenue projection is a "conservative estimate" for the incremental revenue the carrier expects from the additional passengers it will attract as a Star member. TAM formally joined Star on 13 May at a ceremony in Sao Paulo.

Barroso says TAM expects Star will eventually drive a 3% to 5% increase in its international passenger traffic. He estimates it could take two years for these figures to be reached as it will take time for TAM to gain global recognition, a typical by-product of joining Star.

Star Alliance CEO Jaan Albrecht says TAM fills a key void for Star as it is the alliance's first Latin American member since Varig left Star in 2006. Varig was in Star for several years, joining as the seventh member, or the first airline to be added after the six founding members. Star, which now has 27 members, is celebrating its 13th anniversary on 14 May with a special midnight celebration in Rio de Janeiro. "Today South America is coming back home," Albrecht said during the Sao Paulo ceremony. "We're proud to call Brazil our home market again."

He points out that TAM immediately gives Star members access to 36 additional South American cities. As a result, TAM "opens up an entire continent to our alliance a continent with a bright future".

Albrecht says Sao Paulo will also become one of Star's largest hubs. He says Star has already begun working with the Brazilian government on introducing infrastructure improvements at Sao Paulo's main international airport, Guarulhos, to improve the passenger experience.

Albrecht calls TAM "a perfect fit for South America because we share the same principles".

Barroso says joining the world's largest alliance "takes us to a new level and will lead us to consolidating TAM as a global company". While TAM has already succeeded in its vision to become the largest airline in South America, "entering Star Alliance was very crucial for [further] growth of the company".

He says TAM first contacted Star about joining the alliance in 2006. Integration work began in October 2008 after Star announced TAM had been accepted as a new member. Barroso says over the last 19 months TAM completely overhauled its IT system, "reorganised our processes" and "implemented many changes".

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