SAO PAULO Jan 8 Brazilian domestic airline Azul
Linhas Aereas pledged on Wednesday to cap the cost of traveling
during the World Cup this year, adding to pressure on
competitors who have been upbraided by the government for
raising ticket prices.
None of the routes that Azul flies during the tournament
will cost more than 999 reais ($420), said Azul founder David
Neeleman, who started Brazil's third-biggest airline after
stepping down as CEO of JetBlue in 2008.
The policy will cost Azul some 20 million reais in foregone
revenue, Neeleman told journalists in Sao Paulo. He said the
World Cup would also have a net negative impact on the carrier's
bottom line due to a dropoff in business travel.
The emphasis on Azul's sacrifice comes after officials
threatened price controls on the country's hotels and airlines,
including larger rivals Gol Linhas Aereas and TAM,
the local unit of Chile's Latam Airlines Group.
Those rivals have been cutting routes, giving back aircraft
and firing flight staff over the past two years in an attempt to
restore profit despite high fuel prices and a tough exchange
rate. The World Cup has loomed as a chance to restore their
suffering profit margins.
But Brazil's aviation industry is under harsh scrutiny as
one of the biggest potential embarassments at the World Cup. A
dozen host cities are scattered around the vast country, which
will force some 600,000 foreigners and 3 million Brazilian fans
through a series of overloaded airports during June and July.
U.S. fans alone will have to book at least 3,500 miles
(5,600 km) in domestic flights between their team's first three
matches in Brazil - to say nothing of the long international
legs to get to the South American nation.
Azul flies only domestic routes with smaller aircraft such
as the 118-seat E-195 made by Brazil's Embraer.