Latin America’s largest airline LATAM has swung into profit as Brazil’s economy shows signs of recovery.
The airline, which was created by the merging of TAM and LAN in 2012, made a profit of $4.7 million after tax for the quarter ending on September 30. This compares with a loss of $113.3 million for the same quarter in 2015.
LATAM’s total revenue also rose by 0.2 per cent to $2.52 billion during the quarter – this comes after 11 consecutive quarters of falling revenue.
The company has benefited from a recovery in the value of the Brazilian real, as well as making deep capacity cuts to its Brazilian domestic schedule and on international flights between Brazil and the US, where the number of seats has been cut by nearly one-third over the last year.
LATAM has also moved to improve its financial position by deferring the arrival of two Airbus A350s from 2017 to 2018.
Earlier this week, LATAM announced a new strategy for domestic services in six countries in Latin America. Under this plan, the airline aims to reduce domestic fares by up to 20 per cent with the goal of increasing passenger numbers by up to 50 per cent by 2020.
Enrique Cueto, CEO of LATAM Airlines Group, added: “Our objective is that fares continue to decline, making air travel accessible to more people and to those who wish to fly more frequently.
“The new travel model seeks to satisfy the needs of today’s passengers, who value fast, convenient and seamless travel, as well as the ability to manage and personalise their own travel experience, only paying for the services they require.”