LATAM Brasil expects slower growth as fuel, currency weigh on expansion
LTM•LATAM Brasil expects to slow expansion in 2027 as high fuel costs, a weaker real and tax changes weigh on its outlook. Brazil capacity growth this year is now expected at about 7.5%, down from an earlier forecast of 8% to 9%.
1. More cautious expansion
LATAM Brasil expects to slow expansion in 2027 as high fuel costs, a weaker real and tax changes cloud the outlook, country head Jerome Cadier said. The airline still plans to take new aircraft and expand its network, but some routes are becoming less attractive economically.
2. Fuel and currency pressures
Domestic capacity growth in Brazil this year is now expected at about 7.5%, down from an earlier forecast of 8% to 9%. LATAM revised its expected fourth-quarter fuel price from about $130 a barrel to around $180, and Cadier said he expects higher fuel prices to persist through next year. About 60% of LATAM Brasil's costs are denominated in dollars, he said.
3. Tax changes and network
Cadier warned Brazil's consumption-tax overhaul could raise airfares as the new system rolls out next year, potentially hurting demand. LATAM has not cut destinations in Brazil and still expects to end the year serving 67 cities; it plans to announce another batch of routes for its new Embraer E2 jets later this month.
