Voa Brasil does not resolve imbalance in air transport – 07/18/2023 – Maria Inês Dolci

Voa Brasil, the R$200 airline ticket program, promised for next August, will be positive for passengers and companies that operate in this economic segment.

But this is yet another palliative measure, as was the discount program for popular cars. Governments (federal, state and municipal), the Legislature, air transport companies and consumer rights organizations will have to discuss a new design for this market.

In the case of the program that made cars costing up to R$ 120,000 cheaper, it is estimated that 125,000 vehicles were sold. The Voa Brasil program has a much broader horizon, as it does not depend on public subsidies, using empty seats from Latam, Gol and Azul.

But in air transport, as well as in the production and sale of vehicles, there is an increasing distance between the desire to buy and the possibility of acquiring a car or an airline ticket.

There are several factors linked to the weak performance of the Brazilian economy since 2014. The GDP (Gross Domestic Product) was negative in three years in this period (2015, 2016 and 2020), practically stable (0.5% in 2014) or around 1 % (2017, 2018 and 2019). The only more relevant increases occurred in 2021, 4.6%, in recovery from the -3.88% of the previous year, and in 2022 (2.9%).

Unemployment and the flattening of family income resulting from this scenario, strongly impacted by the coronavirus pandemic, have made it difficult to purchase air tickets and cars.

There are other factors, such as the tax burden: the weight of taxes varies from 30% to 50% of the final price of cars manufactured in Brazil. In Mexico, this load is around 16%. In Chile, 19%. Profit margins are also always cited as higher in Brazil than in other markets. And imported vehicles are taxed from 60%.

Airlines, in turn, claim that most of their costs are in dollars, and that the US currency has appreciated significantly against the real in recent years. In addition, the price of the main input for passenger air transport, aviation kerosene (QAV), rose 129% between 2020 and 2022.

In 2023, there has already been a reduction in QAV, but not at the level advocated by companies. Airlines also complain about the collection of ICMS (Tax on the Circulation of Goods and Services) on the QAV, which further increases fuel prices.

As for passengers, the last few years have been very difficult: they started to pay for the dispatch of bags, snacks, meals and even for assigning seats. And the airports, whose administration has been transferred to the private sector, are still far from a minimum standard of quality and comfort.

To make matters worse, there are still few flights to the interior of the country, which is a big commercial mistake, as the Census itself showed that growth is much greater far from the big centers.

Therefore, while palliative programs are activated, it would be essential to take measures so that the consumer does not remain so far from essential transport in a country of continental dimensions.

Consumers deserve much more than they have been getting.

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