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GOL: One Of The Best-Run Airlines In The World  
User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Posted (9 years 7 months 2 weeks 1 day 5 hours ago) and read 6810 times:

Today's Financial Times has an article on Brazilian LCC GOL entitled "How Brazil's GOL got off the ground" by Jonathan Wheatley.

The newspaper states that GOL is "one of the best-run and profitable airlines in the world"

After four years in operation commands one-quarter of Brazil's market. Last year it raised USD 280m in one of the most successful initial public share offers (IPO) in LatAm corporate history.

"Gol is already one of the best-run and most profitable airlines in the world".

http://news.ft.com/cms/s/0384c918-7a41-11d9-9b93-00000e2511c8.html


As covered under a different thread, last week, GOL has increased its order of B737-800 from 43 to 63 airplanes (43 order + 20 options), to be delivered from 2006 to 2010. This will transfor GOL in one of the major airlines in LatAm.

G3's CEO stated that he plans an expansion in South America, and in 2005-2006 GOL will be landing in VVI, SCL, MVD, ASU, CCS and MIA.

At the moment GOL has a fleet of 29 737NGs, serving 39 destinations. GOL's domestic market share in Brazil is 22%. GOL operates 300 takes-off every day.

http://www.voegol.com.br/

For corportate information:

http://www.mz-ir.com/gol/eng/

Rgs,


16 replies: All unread, jump to last
 
User currently offlineIncitatus From Brazil, joined Feb 2005, 4014 posts, RR: 13
Reply 1, posted (9 years 7 months 2 weeks 1 day ago) and read 6694 times:


Even though I don't rate an airline based on one experience, my first shot
at Gol didn't come out as I hoped.
My flight departed Congonhas after a 1:20 h delay without bad weather.
For the first hour there was no information about how late we would be.
At check-in, the huge line was at snail pace. It's just amazing how much
time the check-in agents spend to check-in one passenger.
For a young company like Gol it looked like all their systems and business
processes should be due for an upgrade.
And to top it off the walk up fare for a 50-min flight was past $140 US.
But my return into Congonhas a few days later on TAM was
in another league: quick check-in and push back 5 minutes ahead of
scheduled departure time.
No matter how much press they get, Gol still has some way to go. Or to goal.








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User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 2, posted (9 years 7 months 2 weeks 22 hours ago) and read 6661 times:

Even though I don't rate an airline based on one experience

Completely agree.

PPVRA posted under another thread GOL's on-time performance in 2004, and I copied it below:

JAN- 78%
FEB- 80%
MAR- 87%
APR- 88%
MAI- 88%
JUN- 87%
JUL- 83%
AUG- 86%
SEP- 85%
OCT- 79%
NOV- 79%
DEC- 68%

On-time flights meaning flights arriving within a 15min tolerance time. From the above figures, we see that GOL has a good average (about 80%), however, there is room for improvement.

All in all, GOL deserves our merits. Over the last few years is one of the few good news in the aviation market in LatAm.

When was the last time that a LatAm airline managed to get a full-page coverage in a major international newspaper such as the Financial Times?


User currently offlineEZEIZA From Argentina, joined Aug 2004, 4967 posts, RR: 24
Reply 3, posted (9 years 7 months 2 weeks 18 hours ago) and read 6603 times:

I haven't tried GOL yet, but their expansion is proving them to be a profitable and well-run airline. They recently started flying to EZE, and as posted above and on other threads, they will start SCL, CCS, etc. Great to see some LatAm airlines doing really well  Smile


Carp aunque ganes o pierdas ...
User currently offlineDfwRevolution From United States of America, joined Jan 2010, 978 posts, RR: 51
Reply 4, posted (9 years 7 months 2 weeks 17 hours ago) and read 6574 times:

The newspaper states that GOL is "one of the best-run and profitable airlines in the world"

Well duh... use the WN model and you're bound to be successful.


User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 5, posted (9 years 7 months 2 weeks 5 hours ago) and read 6470 times:

use the WN model and you're bound to be successful

Honestly, I think GOL has developed its own business model. It is correct to say that initially GOL based its business model on LCCs such as WN and EasyJet. But Brazil is a peculiar case, e.g. long distances and unstable market, so GOL had to adapt the model to the local circumstances.

In Brazil the LCC's model of "point-to-point" flights also doesn't work. You need to work under a network feeder scheme, connecting pax from point A to C, via B.

Let's hope to see GOL continue to grow, and expand its network in Brazil and LatAm. The region has very poor intra-regional air connections and GOL could fill this gap and make a good profit out of it!

Rgs,


User currently offlineIncitatus From Brazil, joined Feb 2005, 4014 posts, RR: 13
Reply 6, posted (9 years 7 months 2 weeks 5 hours ago) and read 6457 times:



The Brazilian government interferes with the fares available and prevents Gol from setting really low fares to stimulate traffic growth.
Part of Gol's challenge is to adapt to a regulatory environment pretty similar to the one of a banana republic.






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User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 7, posted (9 years 7 months 2 weeks 4 hours ago) and read 6449 times:

Part of Gol's challenge is to adapt to a regulatory environment pretty similar to the one of a banana republic.

Really? Could you please give examples of completely deregulated markets? Or you think that the heavily subsidised legacy airlines in Europe and the US operate under a free environment? Maybe in small countries...

GOL has set a precedent and the Government is on a learning curve. Take the example, last year, when GOL started selling tickets for R$1 (or USD 0.37). First, the Government interfered, and afterwards backed-off and allowed GOL to go ahead with its price policy.

The point is that GOL's fares, on average, are not really "low fares" because of GOL's own business decision! Everybody thinks that "low cost" airlines always offer the cheapest ticket! This is a fallacy! Easyjet and Ryanair are not always the cheapest. Example: Easyjet tickets AMS-Geneva are almost always more expensive than KLM! Of course, when GOL is acting to carve out some new niche/market, it will offer very attractive fares, e.g. EZE.

Rgs,


User currently offlineMrocktor From United States of America, joined Jan 2005, 1668 posts, RR: 49
Reply 8, posted (9 years 7 months 2 weeks 2 hours ago) and read 6413 times:

GOL, although certainly a low-cost operator, abandoned the low fare model very quickly. Their current pricing places them only slightly below their competitors. This guarantees high occupation and high margins, they are NOT stimulating demand except during specific promotional ventures.

mrocktor


User currently offlineIncitatus From Brazil, joined Feb 2005, 4014 posts, RR: 13
Reply 9, posted (9 years 7 months 2 weeks 2 hours ago) and read 6379 times:

>> The point is that GOL's fares, on average, are not really "low fares" because of GOL's own business decision!

That is not entirely accurate. The Brazilian gov't slowed down the acquisition of new aircraft by Gol. One way the company found to adjust to the government and to its inability to increase supply was to charge more. Gol's "own business decision" given gov't meddling.

As to completely deregulated environments, no I am not aware of any. Governments have to play a role insuring that no company will take 100% of the market and that there are opportunities for at least some companies to make money.






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User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 10, posted (9 years 7 months 2 weeks 1 hour ago) and read 6353 times:

Incitatus:

Welcome to the forum! I hope you enjoy it! Your contribution has been very constructive!

they are NOT stimulating demand except during specific promotional ventures.

GOL does stimulate demand for the very fact that it increases competition. How many Brazilians boarded an aircraft for the first time ever because of GOL?

Their current pricing places them only slightly below their competitors. This guarantees high occupation and high margins

Completely agree with you. GOL's also manages to get a share of TR and VP market, which allowed for charging higher fares.

The Brazilian gov't slowed down the acquisition of new aircraft by Gol.

Maybe you forgot GOL's order of 63 B737-800. And 29 B737-800 in four years looks an impressive growth.

As to completely deregulated environments, no I am not aware of any.

Thanks; this is what I expected.



User currently offlineIncitatus From Brazil, joined Feb 2005, 4014 posts, RR: 13
Reply 11, posted (9 years 7 months 1 week 6 days 21 hours ago) and read 6305 times:


Hardiwv - Thanks.

>> Maybe you forgot GOL's order of 63 B737-800. And 29 B737-800 in four years looks an impressive growth.

I'm not making this up. Look at the how Gol's fleet developed. After a highly successful launch the company added aircraft steadily up to early 2003. Then it stopped receiving aircraft for more than a year.
In May 2004 the Gov't finally gave in and Gol ordered 15 planes that snowballed into the order you describe. At the same time it let Gol lease used aircraft which trickled in over the past 6 months.
Notice that while Gol stopped receiving aircraft Varig was bleeding and so was TAM. The Gov't wanted to help the other airlines. What did this do to Gol? They became extremely profitable because their seat supply was limited. They even got a full page on the FT.  Smile
It may have been that if Gol were free to trade, Varig would have suffered a very thorough death and all those MD-11s would be painted corny red now.

Gol is an important transport company in Brazil. The country desperately needs affordable long distance travel. What I would really like to see is a company focused in point to point service out of GRU flying hi-density wide-bodies - think 400 pax 767-400s. And using freight to cover a significant portion of costs to POA, SSA, MCZ, REC, NAT, FOR, BEL, MAO, CGR, BSB and EZE too. That would drain to an end those 45 hour bus trips, bring fares to about 5 US cents per mile and really stimulate demand.






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User currently offlineMrocktor From United States of America, joined Jan 2005, 1668 posts, RR: 49
Reply 12, posted (9 years 7 months 1 week 6 days 9 hours ago) and read 6249 times:

"GOL does stimulate demand for the very fact that it increases competition. How many Brazilians boarded an aircraft for the first time ever because of GOL?"

In theory you are right. In practice, what happened was that as GOL's market share increased, Varig and TAM got into such dire straights (Varig most of all) that the government allowed them to begin a code-share which in effect means price setting. Varig and TAM used to actually compete, driving each other's fares down. Varig+TAM don't compete at all. Ticket prices rose across the board immediately after the code-share began.

GOL was more then happy to increase their fares as well. They are out to make money, not to provide affordable travel. Naturally, with GOL's continued expansion they will gradually move pricing down - to increase traffic and gain volume at a slightly lower margin. But don't kid yourself about a "revolution" in brazilian air travel.

I'm willing to bet that 90% of the brazilians that set foot on an airplane for the first time because of GOL did so during some promotion - such as the 1BRL fares or the cheap red-eyes.

mrocktor


User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 13, posted (9 years 7 months 1 week 6 days 9 hours ago) and read 6245 times:

Gol is an important transport company in Brazil. The country desperately needs affordable long distance travel.

GOL is playing an important role here, and it may do the same for intra-regional flights in South America and maybe even MIA.

What I would really like to see is a company focused in point to point service out of GRU flying hi-density wide-bodies - think 400 pax 767-400s

Slowly you are having this type of service to some high density domestic markets, e.g. GRU-IGU, GRU-POA, GRU-REC, GRU-BSB, GRU-FOR, GRU-MAO, GRU-SSA, GRU-CNF, GRU-NAT - all are served nonstop with wide-bodies and with more than one flight daily. Considering that CGH also duplicates flights to these destinations, I consider this a major achievement!

Rgs,


User currently offlineHALFA From United States of America, joined Jan 2004, 1354 posts, RR: 15
Reply 14, posted (9 years 7 months 1 week 5 days 10 hours ago) and read 6138 times:

As a frequent visitor to Brasil, I have flown just about every airline one could fly between the US and Brasil and between GRU-GIG. Three weeks ago, I flew GOL for the first time. My experience was not so great. I'm not sure I would label them "one of the best run airlines in the world" just yet. Having said that, I do see much potential.
My flight from GRU to GIG was 45 minutes late, and to make matters worse, I waited onboard the aircraft for over an hour with no air conditioning on a hot summer day in Sao Paulo for 20 or so passengers coming in from EZE.
A week later, I flew GIG to GRU and stood in line at Galeao for 1 hour and 45 minutes just to check in! The line was horrendous! Then we boarded the plane and waited again for an hour because "other passengers were still in line checking in", according to the agent at the gate. At least that plane had air conditioning.
Service onboard once we were airborne was great and the fare I paid (R$198.00 Return) was fantastic. You get what you pay for!
They do have a way to go, but I wish them well and hope they will succeed. If their entry into the Brasilian market will lower fares I'm all for their success. The market as it stands in Brasil as well as flights from the US to Brasil is way over priced, compared to markets of comparable distances. Just 2 years ago, I was paying $400-500 US from LAX to GIG (RT) and now it's about $900.00! Meanwhile, LAX-NRT/HKG/ICN is going for under $500.00.
Again, I wish them well.

Aloha



Don't mess with Texas....We just may do that!
User currently offlineB752fanatic From United States of America, joined Jul 2003, 918 posts, RR: 8
Reply 15, posted (9 years 7 months 1 week 5 days 6 hours ago) and read 6095 times:

To MIA?

What they will use a 737-700 with a stop in MAO?




"Truth is more of a stranger than fiction." Mark Twain
User currently offlineHardiwv From Brazil, joined Oct 2004, 8780 posts, RR: 49
Reply 16, posted (9 years 7 months 1 week 5 days 6 hours ago) and read 6085 times:

To MIA?

MAO-MIA with the 737-800NG. Currently LAB flies 3 x week MAO-MIA with the 767-300.

Rgs,




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