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Gol Linhas Aereas Inteligentes SA, the second-largest airline in Brazil, is raising fares on signs that demand has stopped a yearlong decline.
“We are recuperating our prices, while still keeping them attractive for passengers,” Chief Planning Officer Celso Ferrer said in an interview in Sao Paulo Thursday. “We will still have promotions, but we want to improve our average yield.”
The Brazilian airline industry dropped prices in the first four months of the year to stimulate travel that started waning in 2014. The decline among business travelers that started prior to last June’s World Cup soccer championship is easing, according to Gol’s estimates. Quickening inflation, higher interest rates and rising unemployment are hurting overall demand.
Lower first-quarter fuel prices compensated for the drop in airfares. With jet fuel costs now rising, it’s impossible to maintain the cheap tickets of yore.
It was inevitable that Gol raise its prices again, Ferrer said. “There’s too much pressure on costs.”
To contact the reporter on this story: Christiana Sciaudone in Sao Paulo at firstname.lastname@example.org To contact the editors responsible for this story: Edward Dufner at email@example.com Bruce Rule, Molly Schuetz.
This article was written by Christiana Sciaudone from Bloomberg and was legally licensed through the NewsCred publisher network.