The Brazilian carrier GOL Linhas Aereas posted a $416 million net loss in 2020 due to the impact of the COVID-19 pandemic worldwide.
Additionally, in 2020, GOL saw a 54 percent decrease in revenue passengers. The airline carried 16.7 million passengers last year, compared to the 36.4 million of 2019. This led to a 55.8 percent decrease in the passenger operating revenues during the year. Additionally, cargo revenues also fell by 25 percent, said GOL in a statement.
Net Yield fell eight percent in 2020, going from 31.24 reais cents to 28.74. Additionally, PRASK fell 10.2 percent; CASK fell 6.7 percent, and CASK increase 15.7 percent, said the carrier.
Nevertheless, GOL maintained liquidity and took many cost-saving initiatives throughout the year.
“As the most challenging year in the history of commercial aviation comes to a close, we continue to be focused on managing the impacts of the COVID-19 pandemic on our business”, said Paulo Kakinoff, GOL’s CEO. Kakinnof added that the business model, under a single-type fleet operating schedule and a low-cost structure, enabled GOL to rapidly expand and contract routes to meet fluctuations in demand. Plus, during the quarter, GOL amortized approximately $1 billion reais in financial debt.
GOL’s final quarter had a better financial performance due to the arrival of the high season in Brazil. The airline operated approximately 403 daily flights, doubling the average of the third quarter. The number of flights represented 54% of the day-to-day operations it had the previous year. GOL served 177 markets across the country and reopened the last six bases it maintained closed in Brazil: Carajás, Fernando de Noronha, Cruzeiro do Sul, Jericoacoara, Caldas Novas, and Cabo Frio. For the last five years, GOL has maintained itself as the leader in the Brazilian domestic market. The airline holds a 38 percent market share in the country.
The merge GOL-Smiles
Smiles is GOL’s loyalty and mileage program, inherited after GOL acquired Varig back in the early 2000s. In December, GOL submitted to Smiles Board of Directors a new proposal to merge. “GOL believes the proposed transaction is an important milestone to maximize future value for both the Company and Smiles’ shareholders by increasing the GOL Group’s market competitiveness,” said the airline. Smiles’ shareholders will have a meeting on March 24 to approve this merger.
The MAX return
GOL was the first airline worldwide to bring back the Boeing 737 MAX to commercial operations. Currently, all eight 737 MAX aircraft are operating on the longest domestic routes in Brazil. Nevertheless, the airline expects to deploy the MAX fleet to international routes as soon as this market recovers. GOL still has an order for the future delivery of 95 MAX aircraft. Additionally, it expects to accelerate the transition of the current 737 NG fleet to enhance the opportunities for cost reduction and efficiency gains. In January, GOL received its eighth MAX aircraft. Moreover, it expects a further nine deliveries in 2021. By the end of the year, GOL expects that 15% of its NG fleet will be replaced with the MAX.