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Varig Debt, Now US$3.4 Billion  
User currently offlineGlennpower From Brazil, joined Jul 2004, 102 posts, RR: 0
Posted (9 years 5 months 3 days 21 hours ago) and read 2023 times:

I have just read in the Brazilian magazine AERO that Unibanco and Trevisan (consultancy firm to RG),asked the Brazilian government to defer for 240 months (20 years) all monies owed,which including all creditors now stands at over 9 Billion Reais ,approximately 3.4 billion US dollars.
I have heard that RG must pay US$200,000 every day just in interest payments,no wonder the service is so bad,mainly as a result of extreme incompetence by the Ruben Bertha foundation over recent years,especially
a very stubborn person in Yutaka Imagawa who thankfully is no longer there.
As I have said before they should never have gotten rid of Fernando Pinto,now doing a top job at Tap.
The Varig Novela (soap opera in Portuguese) continues.

Regards to all.

14 replies: All unread, jump to last
 
User currently offlineStevenUhl777 From , joined Dec 1969, posts, RR:
Reply 1, posted (9 years 5 months 3 days 21 hours ago) and read 2016 times:

We wish we only had US $3.4B in debt.... Yeah sure

Signed,
Delta, American, Continental, Northwest, and United Airlines.


User currently offlineGlennpower From Brazil, joined Jul 2004, 102 posts, RR: 0
Reply 2, posted (9 years 5 months 3 days 20 hours ago) and read 1981 times:

Ah but all those carriers you named are way bigger,so all in proportion really.

User currently offlineGaleaocumbica From United Kingdom, joined Mar 2004, 94 posts, RR: 0
Reply 3, posted (9 years 5 months 3 days 20 hours ago) and read 1957 times:

Hi,

I agree with you StevenUhl777.
VARIG is not alone!!
Just look around!

Cheers

GaleaoCumbica


User currently offlineSenorcarnival From , joined Dec 1969, posts, RR:
Reply 4, posted (9 years 5 months 3 days 20 hours ago) and read 1946 times:

How does VARIG manage to stay afloat in all this debt while their one-time competitors are now long gone? Maybe I don't have my figures right, but was TransBrasil and VASP's debt bigger?
I don't mean to be cynical, but is the government giving them a break as VARIG is pretty much synonymous with Brazilian aviation so for the sake of keeping the appearances of some semblance of success they'll give them a break?


User currently offlineAvianca From Venezuela, joined Jan 2005, 5925 posts, RR: 40
Reply 5, posted (9 years 5 months 3 days 20 hours ago) and read 1934 times:

the situation for Varig seems not to be the best for them.

I hope not but all indications looks for the end of this company in near future.

regards



Colombia es el Mundo Y el Mundo es Colombia
User currently offlinePPVRA From Brazil, joined Nov 2004, 8964 posts, RR: 39
Reply 6, posted (9 years 5 months 3 days 19 hours ago) and read 1930 times:

Quoting Senorcarnival (Reply 4):
How does VARIG manage to stay afloat in all this debt while their one-time competitors are now long gone?

TAM is RG's new competitor, along with GOL.

Quoting Senorcarnival (Reply 4):
Maybe I don't have my figures right, but was TransBrasil and VASP's debt bigger?

Not in terms of units, but they closed doors because they simply ran out of cash and could not afford fuel.

Quoting Senorcarnival (Reply 4):
I don't mean to be cynical, but is the government giving them a break as VARIG is pretty much synonymous with Brazilian aviation so for the sake of keeping the appearances of some semblance of success they'll give them a break?

Some people claim so, but so far the government hasn't given them a nickel. Some 60% if I'm not mistaken of RG's debt is with the government. Also, RG won a lawsuit against the government worth some R$ 3 billion, which should cut their total debt by a third.

The government has repeatedly stated that they are in favor of a "market solution" for Varig. Currently, RG has 7 investors interested in acquiring the airline.

Cheers,
PPVRA

[Edited 2005-04-18 23:03:06]


"If goods do not cross borders, soldiers will" - Frederic Bastiat
User currently offlineFMAL From Brazil, joined Jan 2004, 486 posts, RR: 1
Reply 7, posted (9 years 5 months 3 days 19 hours ago) and read 1908 times:

Aviation is a strategic market to any nation. I think the Brazilian Govt with its interests abroad is doing the right thing if they're giving Varig a break, which they're really not....maybe they're going lighter on Varig then they did with Vasp, but still....if the Govt decided to forgive Varig's debt, they'd be loosing far, far less money then what they did for the Banks, now posting perennial record profits. The Govt, through its state owned companies such as Infraero (airports) and BR Distribuidora (Fuel) demand that Varig pays their rates for airport and fuel daily, cash deposit.....that's putting a strangle hold on Varig's throat, as they're having cash flow difficulties (imagine over 2 million dollars leaving your account every single day....).

But, they're not alone.....I think its amazing just how high airline costs are, particularly in Brazil, where bureaucracy, high rates and taxation are trademarks....


User currently offlineJetdeltamsy From United States of America, joined Nov 2000, 2987 posts, RR: 7
Reply 8, posted (9 years 5 months 3 days 19 hours ago) and read 1876 times:

$3.4 billion US is a huge debt for Varig. Massive.

Varig is like Alitalia, Olympic or other similar financial basket cases that always seem to get that "final" financial bailout by their local government.

i have experienced their service a couple of times between the US and Brazil. Business class and economy...service both ways was very good, the aircraft were clean, everything worked.



Tired of airline bankruptcies....EA/PA/TW and finally DL.
User currently offlineSenorcarnival From , joined Dec 1969, posts, RR:
Reply 9, posted (9 years 5 months 3 days 19 hours ago) and read 1874 times:

Quoting PPVRA (Reply 6):

TAM is RG's new competitor, along with GOL.

Right, I knew that. I was reffering to VASP and TransBrasil.

Quoting PPVRA (Reply 6):
Some people claim so, but so far the government hasn't given them a nickel. Some 60% if I'm not mistaken of RG's debt is with the government. Also, RG won a lawsuit against the government worth some R$ 3 billion, which should cut their total debt by a third.

Well, perhaps not in terms of giving them financial compensation, but I was mostly refering to just a break, like, "hey buddy, we know times are tough, we'll take it easy on you." But appearently that does not seem to be the case?


User currently offlinePPVRA From Brazil, joined Nov 2004, 8964 posts, RR: 39
Reply 10, posted (9 years 5 months 3 days 19 hours ago) and read 1859 times:

Quoting Senorcarnival (Reply 9):
Well, perhaps not in terms of giving them financial compensation, but I was mostly refering to just a break, like, "hey buddy, we know times are tough, we'll take it easy on you." But appearently that does not seem to be the case?

Ok, I get you. But no, not even a break (TAm and GOL would be kicking and screaming if that was the case, and rightly so ). As FMAL stated above, Infraero and BR (Aviation fuel destributor) are after RG for every penny, and they want it on time. Infraero almost had to sue Varig last year for several million USD because RG failled to present a viable plan to finance their debts. In the last minute, RG got a plan approved by Infraero and the lawsuit was avoided.

I believe a similar lawsuit was filed against VASP last year.

I don't want to sound like I'm making as excuse here, RG's management MUST go. Apparantly they are on their way out as soon as the new invstor is announced.

Cheers,
PPVRA



"If goods do not cross borders, soldiers will" - Frederic Bastiat
User currently offlineSenorcarnival From , joined Dec 1969, posts, RR:
Reply 11, posted (9 years 5 months 3 days 18 hours ago) and read 1829 times:

I remember growing up and one of my mom's best friend was some sort of big wig at RG and it just sounded like those were glory days. These days, this guy hasn't worked at RG for nearly ten years and the glory days seem to be far from over.
I agree with you. I don't think that your impression of bad mgmt is very far off. I don't have enough fingers to keep track of how many companies have been ruined by bad management.


User currently offlineYUL332LX From Canada, joined Feb 2004, 820 posts, RR: 1
Reply 12, posted (9 years 5 months 3 days 18 hours ago) and read 1807 times:

Quoting Glennpower (Thread starter):
all monies owed,which including all creditors now stands at over 9 Billion Reais ,approximately 3.4 billion US dollars.

Are RG's debts denominated mostly in Reais or US$?



E volavo, volavo felice più in alto del sole, e ancora più su mentre il mondo pian piano spariva lontano laggiù ...
User currently offlinePiedmontnut From United States of America, joined Apr 2005, 79 posts, RR: 0
Reply 13, posted (9 years 5 months 3 days 17 hours ago) and read 1772 times:

Welcome to the world of operating in the RED.  crowded  Sad indeed for the employees and the airlines.


May the A380 arrive @ MCO in the near future.
User currently offlineErikwilliam From Brazil, joined Mar 2004, 2152 posts, RR: 11
Reply 14, posted (9 years 5 months 2 days 23 hours ago) and read 1655 times:

Quoting YUL332LX (Reply 12):
Are RG's debts denominated mostly in Reais or US$?

with the government, excepet Petrobras, in Reais, the lessors and the rest : USD



Dida, Cafu, Lucio, Roque Junior, Roberto Carlo, Emerson, Ze Roberto, Ronaldinho, Kaka, Adriano, Robinho, Ronaldo
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