Brazilian Skies Getting Busy

Recent moves by Brazilian airlines are clear indicators that the country’s property boom is having a direct effect on the country’s residential tourism industry, with travellers and potential buyers alike jostling for flights. This week, low-cost Brazilian airline, Gol, took out a $310 million (£152.6 million) loan to invest in new aircraft and Varig Varig (VRG) has announced that it has signed six agreements with international airline carriers, expanding its flight network to regions and cities not covered by its previous network and simplifying the ticket-buying process.

The agreements cover the carriers Germany’s Hahn Air, Hungary’s Malev, Israel’s El Al, Italy’s Air One, Mexico’s Mexicana and Qatar’s Qatar Airways, as well as a recent interline deal with fellow Brazilian airline Gol. VRG last month joined the Multilateral Interline Traffic Agreement, a network of airlines from around the world whose members have the option of forming interline agreements with each other. The alliance means that VRG passengers will be able to purchase tickets to destinations in these countries through the Brazilian airline’s partners, with immediate effect.

Following an estimated 134% increase in visitors to Brazil since 2004, the north east coast of the country has seen a property boom centred around Natal, Fortaleza and now Maceio coupled with a massive investment injection and infrastructural renovation. The highly anticipated San Gonzalvo airport is due to open in the area in 2010 and will be the world’s fourth largest airport. Keen to stake its claim in the Brazilian skies is cheap and cheerful carrier, Gol whose loan sees it using funds from eight different banks, including Calyon and Citigroup, to complete a pre-delivery payment plan for 21 new Boeing 737-800 next generation planes, part of the company’s strategy to lower operating costs and meet increasing demand from foreigners for all things Brazilian.