Everyone knows the law of supply and demand. The more demand there is for a product, the more its price tends to increase. After more than a year of travel demand far below normal (and, consequently, lower prices on airline tickets), the sector is starting to show signs of recovery, driven by the advancement of vaccination in Brazil.
But this time, along with the increase in demand, supply also increased: if in the pre-pandemic we had only three national airlines operating here, today there are four: Azul, Gol, Latam and ITA, from Group Itapemirim, released in the second half of May 2021.
With the increase in competitiveness on national routes, the tendency is for prices to become more competitive. the flight finder viajala.com.br made a comparative study between the prices practiced by the national airlines Azul, Gol and Latam on some routes that Ita also started to operate, shortly after the launch of the new company's ticket sales.
The survey takes into the average prices found by Viajala s in searches made in the period between June 15 and July 15, 2021.
According to the analysis, the GOL presented a price drop of up to 28% in 3 of the 4 analyzed routes. THE BLUE presented prices up to 17% lower also on 3 of the 4 study routes. THE LATAM showed a price drop by 9% in 1 of the 4 routes observed.
“These average price drops are curious if we consider the timing, which is the resumption of travel in Brazil”, ponders Josian Chevallier, VP of sales and co-founder of Viajala. “Travellers are feeling more confident and demand for travel has been steadily increasing, which would drive up the price, in a natural move.”
For the specialist, it is possible that these falls are related to the arrival of the new airline.
“We cannot say for sure, since there are many factors that influence the price of airline tickets, but it makes sense that the price of a specific route becomes more competitive when more companies start to operate it”.
One of the reasons that makes Chevallier credit the price drop to the promotion of competition in the national airline market is the fact that, without Itapemirim, these same routes had a price increase of up to 137% between the second half of May and the first half of June, compared to the same previous period (between mid-April, peak of the pandemic, and the first half of May).
“Prices were on an upward trend and had this drop in the fair average value at the moment when vaccination advanced the most”, points.
Since the bankruptcy of Avianca, in the first half of 2019, until the launch of Ita, in June 2021, Brazil has only three national airlines. The drop in competitiveness caused an almost instantaneous increase in the average ticket price.
On that occasion, the travels carried out a survey to diagnose this increase and pointed out that 85% of the routes had an average price increase as soon as the Avianca bankruptcy was announced.
Tickets on the analyzed routes were 11% to 218% more expensive. In 22% of the cases, the increase was more than 100% in the practiced value.
“Airfare prices have fallen a lot during the pandemic, but they should rise consistently in these months of recovery. More competitiveness in the national flight market is a hope for cheaper travel when all this is over”, concludes the executive of the travels.
See below the results of the study carried out by the search engine viajala.com.br:
Analyzed routes:
Sao Paulo – Rio de Janeiro
Porto Alegre – Sao Paulo
Brasilia – Sao Paulo
Belo Horizonte – Porto Seguro
Period analyzed:
One-way flight searches made between June 15 and July 15, 2021
Results:
on route Sao Paulo – Rio de Janeiro:
Price average GOL: R$248, down 16% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 36%.
Price average BLUE: R$428, an increase of 36% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 63%.
Price average LATAM: R$363, down 9% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 67%.
on route Porto Alegre – Sao Paulo:
Price average GOL: R$395, down 4% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 137%.
Price average BLUE: R$530, down 4% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 54%.
Price average LATAM: R$461, an increase of 7% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 70%.
on route Brasilia – Sao Paulo:
Price average GOL: R$323, down 28% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 113%.
Price average BLUE: R$466, down 14% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 23%.
Price average LATAM: R$402, an increase of 24% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 45%.
on route Belo Horizonte – Porto Seguro:
Price average GOL: R$633, an increase of 8% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 43%.
Price average BLUE: R$622, down 17% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 17%.
Price average LATAM: R$796, an increase of 12% compared to the previous period. Between May 15 and June 15, the increase recorded in relation to April was 45%.
