VRG Restructures International Route Network
SAO PAULO, Brazil, April 10 /PRNewswire-FirstCall/ -- GOL Linhas Aereas Inteligentes S.A. (NYSE:GOL)(NYSE:and)(NYSE:Bovespa:)(NYSE:GOLL4), the parent company of Brazilian airlines GOL Transportes Aereos S.A. and VRG Linhas Aereas S.A., announces VRG is restructuring its international routes, focusing on better adapting to market conditions, increasing its presence in the domestic and South American markets and concentrating efforts on routes where it maintains competitive advantages.
Operating costs in the highly competitive international market have increased substantially with persistent increases in oil prices, which recently hit a record high of US$112 per barrel. The cost of fuel has been impacted by the prices of WTI and Gulf Coast Jet, which increased on average 68 and 61 percent, respectively, in 1Q08 compared to 1Q07. Fuel currently represents nearly 40 percent of VRG's operating costs. The Company's focus is to expand its route network in Brazil and South America by maintaining a lean cost structure and increasing revenues. An important step in this plan was taken in March, with the introduction VRG's new domestic flight network. After several changes to the international route network to focus on South American destinations, VRG will continue to offer daily flights to Bogota, Buenos Aires, Caracas and Santiago.
To this end, VRG will suspend flights to several international destinations over the next two months. Flights to Mexico City will be suspended on May 11, flights to Madrid on May 12 and operations to Paris will cease on June 9. This strategic decision was a responsible and calculated response based on careful analysis of external factors and competitive attributes of the services offered by VRG that are affecting consolidation of the Company's performance in these markets. VRG is committed to providing assistance to those customers who have already purchased one-way or return tickets to suspended destinations after the dates announced and will maintain open, transparent communications to address any customer concerns. Alternative flight information will be available on the Company's website, www.varig.com.br. VRG has also created a toll-free number for customers with questions: 0800-728-7787. The service will be available 24 hours a day, seven days a week. Customers who prefer a refund should work directly with their travel agent, while customers who purchased tickets directly from VRG can request a refund by e-mail: reembolso.central@varig.com. First Call Analyst:
CONTACT: Investors, (5511) 3169-6800, ri@golnaweb.com.br; Media, G. Web site: http://www.voegol.com.br/ir
2008-04-10 23:14:12 0333592 PRNEWSWIRE
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