Brazil government and aviation board has allow foreign investment in brazil domestic market recently, which has opened doors for many outside airline companies. This decision is going to be beneficial for both the airlines and consumers.
Current law places a 20% limit on foreign ownership of a Brazilian airline. The proposed law would scrap that ban. Immediately, foreign airlines could increase their stakes in Brazilian airlines. This will also restrict domestic flights to Brazilian flag carriers. That could quickly lead to foreign airlines serving domestic routes, subject to slot restrictions and operating licenses.
Since the day when Avianca Brazil has filed the bankruptcy, foreign companies are hoping to close the deal with Brazilian government to operate its major domestic routes, the lawmakers and former Brazilian President Michel Temer saw the need for this change. Operating in bankruptcy, Avianca Brasil has had all but six of its aircraft repossessed. Meanwhile, Azul, GOL, and Latam control over 90% of the domestic market.
Which company is planning to invest?
Gol is currently the largest domestic carrier in Brazil. Delta owns a 9.4% stake in the company. On the other hand United Airlines own 8% of Azul and Qatar Airways owns 10% of LATAM.
Under the right circumstances, all three carriers are wanting to add tag flights to their intercontinental service and soon they might start operating in Brazil. Previously United operated flight from Sao Paulo to Rio de Janeiro. But directly the company don’t have though right to sell tickets. Apart from these recently Spanish carrier Air Europa showed interest in invest in Brazilian market.
