Varig drops to 3rd-placed domestic airline, but still top international Brazilian carrier in 2005

9 January 2006

Brasilia, Brazil, 9 Jan – Brazilian company Varig was overtaken by budget operator Gol last year as the country’s second-largest airline, but continues to hold the largest slice of Brazil’s international passenger traffic, officials have said.

Varig carried 26.7 percent of domestic passengers last year compared to the 27.2 percent achieved by Gol and 43.5 percent by market leader TAM.

Gol’s ranking is the best achieved by the low-fare company since its start-up in 2001.

Varig’s slide in Brazil’s domestic airline market is largely due to its filing for bankruptcy protection in June 2005.

Brazil’s Docas Investimentos withdrew its offer lasts week to buy control of the embattled Brazilian flag carrier, saying it would focus efforts on acquiring Varig’s cargo and maintenance arms, VarigLog and VEM respectively.

The three proposals already made for the purchase of Varig’s subsidiary operations are from Aero-LB – a partnership between TAP Air Portugal and Macau casino magnate Stanley Ho, the US-based Matlin Patterson fund and Docas Investimentos. (macauhub)