SAO PAULO, (Reuters) – Bankrupt LATAM Airlines and Avianca Holdings are dramatically retrenching their once grand ambitions amid the COVID-19 pandemic, reducing competition in Latin America as they mull once-unthinkable cooperation with rivals.
Since May, LATAM has exited Argentina, partnered with rival Azul SA in Brazil and cut back domestic operations in Chile, while Avianca has departed Peru.
LATAM is now open to a deeper alliance with Azul, even as the two airlines usually control a combined 60% of Brazil’s domestic market.
Dominant LATAM and Avianca have filed for bankruptcy protection, while auditors for Brazil’s Gol Linhas Aereas Inteligentes are seeking to include a formal warning in the airline’s financial statements that the carrier risks disappearing.
Not long ago, LATAM and Avianca had their planes in almost every corner in Latin America, controlling a combined 60% of the domestic markets in Colombia, Chile and Peru.
