Brazil's Senate summons regulators who point to Avianca Brazil and Petrobras for high airfares

7 August, 2019

Brazil's Senate Infrastructure Commission summoned (06-Aug-2019) Brazil ANAC and the government to discuss high airfares on 06-Aug-2019. ANAC president Ricardo Botelho, National Consumer Agency representative Andrey Vilas Boas and Ministry of Economy representative Cesar Matos argued that: "The market still is strongly affected by the bankruptcy of Avianca Brazil, which is reflected, among other consequences, in higher ticket prices due to reduction in competition". Mr Botelho and Vilas Boas also pointed out that the mixed capital state controlled fuels supplier Petrobras has a monopoly in the sale of aviation fuel, the major generator of cost in an airline's operations. Villas Boas stated: "While we do not consistently address the way aviation fuel is supplied, the airfare structure in Brazil will not change. Production and distribution is totally monopolised". He added that other suppliers managed file lawsuits permitting them to supply aviation fuel at the airports but they cannot operate "because the structure is not available". Mr, Vilas Boas continued: "Even if Brazil can attract LCCs, they will also run into this structural bottleneck". [more - original PR - Portuguese]