Entry of low costs in Brazil causes airfare prices to fall by up to 33%
The Minister of Tourism, Marcelo Álvaro Antônio, highlighted that the operation of new airlines reinforces the increase in competitiveness and develops air connectivity
A survey by the travel company, Melhores Destinos, shows that the arrival of low cost airlines in the Brazilian market can already be felt in the pocket of the traveler. According to the survey, there was a drop of up to 33% in the price of airline tickets on the routes on which these companies began to operate. The approval of up to 100% of foreign capital in companies that operate domestic flights was allowed in the country in 2019, with the publication of Law nº 13,842 / 19.
The biggest reduction was seen in London's fares operated by Norwegian, which went from R $ 3,973 to R $ 1,736. Another significant drop comes from Sky Airlines flights to Santiago with casualties of up to 28%. In Salvador, for example, the tariff reduction took place in January, after JetSmart started operating in December last year.
According to the survey, the reduction in prices did not occur only through the sale of their own fares, but especially due to the reaction of competing airlines, which reduced their margins so as not to lose market in the face of new entrants. “Even those who do not benefit directly from this low-cost model are favored by the competition it causes. And this was evident in this short period when they started to fly in Brazil ”, stated the editor and responsible for new business for the company, Leonardo Cassol.
Brazil already has four low-cost airlines authorized to operate scheduled international flights: Norwegian (United Kingdom), Sky and JetSmart (Chile), in addition to Flybondi (Argentina). In February, the National Civil Aviation Agency (Anac) announced the start of operations of the Spanish airline, Air Nostrum, on domestic routes in Brazil. The company must adopt another name and operate on regional routes as of the second half of 2020.
The Minister of Tourism, Marcelo Álvaro Antônio, highlighted that the operation of new airlines reinforces the increase in competitiveness and develops air connectivity. "The arrival of low costs brings more low-cost offers and is part of a new tourism strategy, which places the sector at the center of the country's economic agenda," said the minister.
Álvaro Antônio also reinforces that measures adopted by the Federal Government in the last year contributed to the increasingly expressive presence of these companies in Brazil. This is the case, for example, of the veto to free baggage allowance and Law 13,842 / 2019, which allowed the participation of 100% of foreign capital in Brazilian airlines.
“We have adopted measures so that the domestic flight market can also have more companies operating. With more competition, we will have better services and, also, a drop in ticket prices ”, he added.