Gol, Brazil”s fast expanding and commercially aggressive regional airline, has come to an arrangement with the current owners of the one-time national carrier, Varig, for its acquisition.
Once the international airline star of Brazil, Varig finally failed last summer, the remains purchased by VarigLog (in essence the Varig cargo division) and Volo, a financial consortium. It has soldiered on with a very limited international network plus a regional operation. It is the two saviours of the airline who have sold to Gol.
According to the new Varig (Gol), the carriers will maintain separate financials and operate under their own brands with independent executive teams. "Gol will maintain focus on its low-cost, low-fare business model, with a single class of service in the Brazilian domestic market and South America," it said in a statement. "Varig will offer differentiated services, with direct flights and a mileage programme that currently serves more than five million clients."
Varig plans to offer a two-class service on long-haul international flights and a single cabin operation for the domestic market. Services are unlikely to be duplicated and both companies will "explore synergies" to improve overall efficiency.
In recent years the UK has only been linked to Brazil via Sao Paulo. Varig pulled out during its crisis period last June and has been replaced by another fast expanding Brazilian carrier, TAM. British Airways is the incumbent British airline to Sao Paulo but with Virgin Atlantic making noises about flying to Rio de Janeiro there could be an opportunity here for the new Varig.
Gol said the two airlines combined will carry more than 20m passengers annually and will be "capable of competing on the South American and world stages against other large international airlines. . .The acquisition represents the best opportunity for operations under the Varig brand to remain a Brazilian-managed and controlled airline."