LATAM Airlines may close an order for five Embraer E195-E2 jets, Folha de São Paulo newspaper revealed. The agreement, the details of which are unclear, would be in exchange for a loan at below-market interest rates to be provided by BNDES, the Brazilian government’s development bank.
The outlet claims that operating the aircraft goes against the wishes of the parent company in Chile.
However, the attractive financing conditions and plans to implement a regional flight network in Brazil have led the LATAM group to accept pressure from the government of President Luiz Inácio Lula da Silva.
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Embraer had acknowledged months ago that it is negotiating the sale of its jets not only to LATAM but also to Gol.
Currently, only Azul has a large fleet of first- and second-generation E-Jets. Thirteen E195-E2s are expected to be delivered in 2024 alone.
To qualify for the loan, Brazilian airlines will have to operate regional flights under a tax reform that is currently being processed in Brazil’s legislature.
Predecessor was Brazil’s largest regional airline
In recent years, LATAM has reduced its flight network, focusing on high-demand routes in addition to international destinations.
This is a strategy that is the opposite of its Brazilian predecessor, TAM, which stood out in the market for implementing a dense flight network with aircraft ranging from the single-engine Cessna Caravan to the widebody Airbus A330-200 and the Boeing 777-300ER.
With its capillarity, TAM surpassed traditional carriers such as VARIG, VASP and Transbrasil, which ended up going bankrupt.
Currently, the smallest aircraft in LATAM’s fleet is the Airbus A319, which has a 144-seat configuration, slightly above the E195-E2 (136 seats on average).
