Varig’s difficulties
Posting this here for the visibility and because the issue involves international carriers, mods please move to LatAmCar if more suitable.
Strange to be posting from Brazil and asking the world what’s happening here. The view from outside is often clearer though and I know there are sane Varig heads on Pprune, not to mention GE Leasing and other interested parties.
To cut a long story short Varig seem to be on their last legs. Debt appears insurmountable, growing by the day, management is revolving-door and all the attempts at rescue or even sell-off of profitable subsidiaries have grounded on legal shoals. Whatever the idea, good or bad, there is legal opposition to block it. The company has been saved from having eleven aircraft, including the 777s, returned to owners, through legal action in New York, but with time limits.
Flight cancellations this weekend have increased, don’t know exactly why but GRU was chaos this morning with queues trailing outside the terminal.
Varig are said to still have 24% of the overall Brazilian market. Don’t remember how that breaks down domestic/international. Brazilian DAC (CAB) gave an interview last week indicating they’re working on several contingency plans, domestic and international. If Varig stops, international should be not much of a problem, temporary license for other carriers to take up the slack. Domestic’s more difficult; shortage of 737s and A319/20s. A one-quarter chunk from supply in what’s supposed to be the world’s fourth largest air transport network could be dramatic to say the least.
No news on local media today. Any ideas from cool heads in Pprune?