TRIP Linhas Aereas
- IATA Code
- ICAO Code
- Main hub
- Belo Horizonte Tancredo Neves International Airport
- Business model
TRIP (Transporte Aéreo Regional do Interior Paulista) Linhas Aéreas is a Brazilian regional airline with its main base at Guarulhos International and Viracopos-Campinas International airports in São Paulo. TRIP was founded in 1998 by the Caprioli Group, a bus and tourism company, and targets Brazil’s large, yet underpenetrated, secondary and leisure markets.
On 28-May-2012 TRIP was purchased by Azul creating the holding Azul Trip.
Location of TRIP Linhas Aereas main hub (Belo Horizonte Tancredo Neves International Airport)
185 total articles
31 total articles
Brazilian airline Azul continues to shake up the country’s aviation business in CY2014 through the launch of widebody operations, an order for Airbus narrowbodies and resuscitating its initial public offering that was shelved in CY2013.
Azul is basing its ambitions on the conclusion that there is significant upside for air travel in Brazil as growth projections over the medium to long term remain relatively robust. The airline believes it has built a solid network to accommodate the long-term demand, and is now making its case to potential investors that it is positioned to leverage the anticipated growth.
But the challenges Brazil’s airlines have faced in the short term – namely a fragile economy – remain intact, and it is not certain if the market will rise to meet Azul’s ambition.
Brazil’s domestic airline market appears to remain in a rational state as the country continues to battle economic weakness. Its two largest airlines TAM and Gol are maintaining capacity discipline, which is helping each company’s respective performance in the domestic market.
The country’s other two main airlines, Avianca Brazil and Azul, are continuing their solid growth trajectories, but their supply expansion and traffic growth appear in line, which does not seem to be triggering a scenario of oversupply within Brazil.
Brazil’s economy could take a slight upswing in CY2015 as its GDP growth is forecast at 2.7% versus a more sluggish 1.8% in CY2014, according to estimates from the IMF. If capacity remains rational in the market place, then Brazil’s slightly more promising economy should create some positive momentum for the country’s airlines.
Traffic in Brazil’s domestic market rebounded during the first four months of 2014 as overall capacity growth in the country remained disciplined largely due to continuing restraint from Brazil’s two largest airlines TAM and Gol.
Avianca Brazil and Azul continued to grow capacity, as measured by ASKs from Jan-2014 to Apr-2014, as both airlines work to solidify their respective stances in the Brazilian market. But the expansion by those carriers should not result in a state of oversupply.
Despite the hype of the FIFA World Cup tournament held in Brazil beginning in mid-Jun-2014, the country’s two largest carriers do not expect any financial benefit from the event, and are bracing for a decrease in traffic and revenues.
Brazil’s third largest airline Azul begins 2014 armed with the final regulatory approval of its merger integration with Brazilian regional carrier TRIP and the possibility of undertaking a public offering after shelving plans for an IPO during 2013.
Even as Azul continues to chart a steady course of growth, it does face some headwinds in 2014 as its recent declaration to cap fares for the upcoming Jun-2014 World Cup will result in a revenue hit of BRL20 million (USD8.4 million). The projected loss occurs as Brazil’s economy remains weak, which has resulted in depressed demand in the country’s domestic market during the past year.
Similar to Mexico, hopes are high that Brazil’s economy will undergo a rebound during 2014. But that does not necessarily translate into a rebound in demand as some cost conscious travellers may choose to hold onto their discretionary income until they conclude an economic recovery is well underway. Those dynamics will certainly play a role in Azul’s evaluation of whether to access public markets for a capital injection.
Brazil’s domestic market has cooled down along with the country’s slumping economy, recording RPK growth of less than 0.1% in 1H2013. While growth should return in 2H2013 it will be very modest and far below previous levels.
Brazil was one of the world’s fastest growing domestic markets in 2010 and 2011, when domestic RPK growth of 23.5% and 15.9% was recorded. Growth slowed to 6.8% in 2012 as carriers started to cut capacity and trim back on expansion plans.
Load factors have improved significantly since mid-2012, providing a glimmer of hope that capacity levels are now sustainable following a period of irrational competition. With capacity returning to more rational levels and four airline groups accounting for over 99% of the market following a wave of consolidation, profitability should eventually improve in the world’s fourth largest domestic market.
Azul's IPO is at a challenging time for economic and traffic growth in Brazil - but offers potential
Nearly five years after inaugurating service, Brazilian carrier Azul is capping off its rapid and highly successful growth with a planned initial public offering. Azul, led by former JetBlue founder and chief David Neeleman has quickly built up a position of strength in the domestic market place through a strategic acquisition it executed during 2012 of fellow Brazilian regional carrier TRIP.
The combination helped Azul flesh out its network and build what it hopes is the necessary scale to withstand the changes its has witnessed in the Brazilian market place during its brief history, ranging from significant growth to a slowdown in traffic expansion as the country’s GDP has slowed during the last couple of years.
The timing of the decision by Azul’s management to take the company public is interesting given that Brazil’s second largest carrier Gol recently warned that inflation in Brazil keeps rising and that it is uncertain if the country will attain its projected 2.5% GDP growth during 2012.
But in making its case to potential investors Azul is attempting to make clear distinctions between itself and Gol by citing yield advantages and merger synergies of BRL200 million (USD96 million) to BRL300 million (USD144 million) during 2013.