Published by Global Banking and Finance Review
Posted on December 10, 2024
By Gabriel Araujo
SAO PAULO (Reuters) - Air France-KLM is optimistic about the Brazilian market for 2025 after posting positive results in the country this year, executives for the European carrier in Latin America's largest economy told reporters on Tuesday.
WHY IT'S IMPORTANT
South America is the second biggest long-haul area for Air France-KLM after North America, and Brazil was a key investment destination for the company this year.
The firm now hopes to consolidate its operations in the country, where it has a commercial partnership with Gol, after an expansion in 2024 that led it to exceed its pre-pandemic frequencies.
BY THE NUMBERS
The 2024 expansion included launching flights between Paris and the coastal city of Salvador and bumping up flights to Rio de Janeiro and Fortaleza, Brazil's fourth largest city and a major beach venue. The company currently operates 47 weekly flights in Brazil, up from 44 prior to the COVID-19 pandemic.
Capacity in 2024 increased 3% on a yearly basis, while the average load factor between January and November in Brazilian routes remained at 2023's strong level of 91.6%, Air France-KLM said.
Revenue levels in 2024 matched the previous year's despite stronger competition, the executives noted in a presentation, while corporate revenues were above 2023 levels.
MACROECONOMIC TURBULENCE
Brazil's economy is going through turbulent times, as the local currency has weakened to historic lows against the U.S. dollar in recent weeks, making traveling more expensive for locals.
Air France-KLM is closely watching the foreign exchange moves, but does not see any negative effect on its operations at the time, they said.
KEY QUOTES
"When you look at the forward movements, for now they are not affected. We do not see today a change in the trend of the demand for 2025," Manuel Flahault, the carrier's South America head said.
"I think there is a true belief that in the medium term Brazil will remain a very strong market to invest in," he added. "We are pretty confident that the demand will remain for 2025."
(Reporting by Gabriel Araujo; Editing by Sandra Maler)
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