Azul and LATAM Brasil to code-share on domestic routes from August 2020

Report by : Gan Yung Chyan

                  / KUCINTA SETIA

Image courtesy : Airline Geeks

Azul Brazil and LATAM Brasil announced on 16 June 2020 a code-sharing flight agreement and frequent flyer programs. The new measures of these two companies indicate that the aviation sector is optimizing the industrial structure in order to respond to the industrial disaster caused by the  pandemic.

The São Paulo Page reported that this cooperation agreement is expected to begin implementation in August 2020. The initial shared flights are 50 non-overlapping domestic routes, including Brasília and Belo Horizonte, Recife and São Paulo.

Azul's president, John Rodgerson, said the partnership agreement will allow 60 domestic routes to be re-opened. The president said that the partnership for code sharing between the two companies will not eventually evolve into a merger relationship. He said in a conference call to reporters, "This is just a way to optimize the industrial structure and develop new aviation destinations."

The new agreement also involves a loyalty program, where 12 million TudoAzul members and 37 million Latam Pass members can continue to earn points in their chosen program.

During the pandemic of  SARS-CoV-2, the anti-epidemic measures taken by governments around the world caused the aviation activities in mid-March to be almost completely stopped. Therefore, even if it is allowed to resume activities in May, Brazilian aviation companies will continue to choose a small number of flights to open operations on all routes.

This cooperation took place a few weeks after LATAM, the largest aviation company in Latin America, filed for bankruptcy in the United States due to the pandemic. The business of the company in Brazil is not within the scope of the bankruptcy application.

At the time of signing the agreement, LATAM was also seeking financial assistance from the Brazilian government through the Brazilian Economic and Social Development Bank (BNDES). Rodson said he hopes "BNDES' aid agreement will be released as soon as possible. The Brazilian government (for aviation companies) provides far less assistance than other overseas governments in this regard."