Air Transport World

Brazilian boom: domestic liberalization has brought an explosion in regional carriers' numbers, traffic and revenues.

Sao Paulo--Since the government deregulated domestic regional air transport in 1992, a boom in traffic, revenues, number of airlines, innovation in service and fleet is rocking the industry. The number of regional carriers had more than doubled from five to 11 at this writing, with eight more in different stages of organization. Before, only TAM among the regionals operated jetliners, with four Fokker 100s in the early 1990s. Now, TAM flies 18 of them, and three other regionals fly 10 jetliners.

The results of the two most successful regional carriers make the major trunk airlines twist with envy. Since 1992, TAM's revenues have grown at around 50% yearly. CEO Rolim Adolfo Amaro estimates the company will reach $400 million this year, up from $260 million in 1994. In turn, Rio-Sul expects to top $230 million, an increase of 53.33% over 1994. Profits also are up. Last year, Rio-Sul earned $25 million, up from $ 11.7 million in 1993. TAM reached $6 million, up from $2.5 million.

Behind the numbers, a revolution is happening as a result of the government's neoliberal approach. The term "regional aviation" has come to be seen as a complex umbrella under which different realities intertwine. …

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