Abra And Azul Make The First Move To Build A Fortress In Brazil

After months of speculation and discussions, Brazilian operator Azul has reached a non-binding Memorandum of Understanding (MoU) with GOL’s parent Abra Group to combine their businesses in Brazil’s aviation market.

Abra—which also controls Colombia’s flag carrier Avianca—and Azul concluded the two Brazilian airlines have 90% complimentary and non-overlapping routes. Last year, amid reports that Azul was interested in merging with its rival GOL, the airlines launched a domestic codeshare.

During Azul’s investor day in December 2024, Azul President Abhi Shah concluded the carrier was happy with its codeshare pact with GOL. “We have not grown it yet because we are balancing the discussions we are having with Abra ... and the timing of the two events,” he explained.

“Although the MoU provides for the unification of strategy, the airlines are expected to keep their operating certificates, and therefore their brands and operations, separate,” Abra and Azul said Jan. 15.

Azul CEO John Rodgerson said the combination of the two carriers would increase the number of flights offered, “reaching more than 200 cities served in Brazil and the ability to compete in a highly globalized sector.”

GOL, which aims to emerge from U.S. Chapter 11 bankruptcy protection in May, operates an all Boeing 737 fleet, which is projected at 140 aircraft at the end of this year. The composition will include 45% 737-800s, 41% 737-8s, 9% 737-700s and 6% 737-800Fs.

Azul often touts the numerous fleet types it operates as a strategic advantage. The carrier’s smallest commercial aircraft is the Cessna Caravan operated by Azul Conecta. The airline also operates ATR 72-600 turboprops, Embraer E195s and E195-E2s, Airbus A320neo family aircraft and A330 widebodies.

The airline said at its investor day that its fleet versatility results in Azul being the only carrier operating in 82% of its routes, and the leader in 91% of those markets. Data from CAPA shows for the week of Jan. 13, Azul’s domestic network encompasses 122 Brazilian destinations and eight international markets, including long-haul flights to Fort Lauderdale and Orlando in the U.S. and Paris Orly and Lisbon in Europe.

GOL, in its recent five-year outlook the airline released as it works to exit Chapter 1l, said it serves 64 domestic markets in the Brazil and 16 international destinations. The majority of its international routes, 14, are markets within Latin America. GOL also operates flights to Miami and Orlando, according to CAPA.

Azul, meanwhile, is no stranger to attempts at forging consolidation in Latin America. The carrier made an attempt to acquire LATAM Airlines Group while it was reorganizing under Chapter 11, and often referenced discussions with Abra during the last year.

Going forward, the proposed transaction is subject to Abra and Azul agreeing on economic terms as well as obtaining corporate and regulatory approvals and satisfaction of customary closing conditions of GOL’s Chapter 11 process.

As Abra and Azul work to solidify their agreement, LATAM Airlines Brazil maintains a 37% share of the country’s domestic departing seats, according to CAPA data, followed by Azul at 32% and GOL’s share of 31%.