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(Last updated: 13 June 2008)
Trends and opportunities
The market
According to the study 'Character and Dimensions of Domestic Tourism in Brazil', carried out in 2006 by the Brazilian Tourism Board, only 3.9 per cent of Brazilian tourists travel abroad. Nearly 9.5 per cent make a 'routine trip' to the same destination in Brazil, with a monthly frequency or at least 10 times a year. An average of 38.5 per cent of them makes domestic trips. In this type of trip, 87.5 per cent of the Brazilian people travel for leisure purposes.
Since it was introduced earlier in the review period, the low-cost concept has established itself in Brazil. Brazilians are very price sensitive, and are always looking for the best quality deals at the most affordable prices. Following the entrance of GOL Linhas Aéreas Inteligentes SA in 2001, and the significant investment seen in economy travel accommodation between 2005 and 2006, there is no doubt that the low-cost concept has enjoyed strong popularity among Brazilians and is expected to continue doing so in the future. There are also new competitors like BRA, OceanAir and Webjet. Following the VARIG crisis, a huge gap was left in international air travel, leading many airlines, particularly TAM and GOL, to exploit this opportunity. 2006 saw the addition of new air routes by both companies, and their competitive position strengthened not only in Brazil but also elsewhere in Latin America.
Recently, the main objective of low-cost carriers has been to add more national as well as international routes at relatively low prices. GOL debuted on the international scene in 2004, when it started flying to Buenos Aires, Argentina. The company is currently awaiting judicial approval to add further flights, mainly to Europe.
Tourism flows outbound in Brazil - destinations
As the Real strengthened over the review period, a larger number of Brazilians have been travelling abroad. The top 10 destinations were the US, Argentina, France, Portugal, Spain, Italy, Uruguay, Chile, the UK and Mexico.
In addition to favourable exchange rates, travel retailers and airlines have also been pivotal in boosting outbound travel, as they have made it easier for Brazilians to finance their trips. In 2006, consumers were able to buy air tickets in up to 10 instalments with zero or little interest.
Tempting promotional offers were also key in encouraging Brazilians to travel abroad. Viagens CVC was at the forefront when it came to outbound travel, offering international packages to New York, Orlando, Buenos Aires, Paris, Aruba, Chile and Margarita Island in Venezuela at very low prices.
Mode of transport
The debut of low-cost carriers, like GOL, BRA and OceanAir, on the international scene has been pivotal in boosting air travel. In addition to offering lower prices, low-cost carriers have entered a battle with larger international airline companies to win travellers making outbound departures.
Purpose of visit
Business travel increased by 22 per cent in 2006. Although companies also benefited from a stronger Real vis-à-vis the US dollar.
The 2006 VARIG crisis has had a huge impact on business travellers, who have lost their frequent flyer benefits temporarily as the company reduced its number of flights and forced them to choose a different airline until its operations were back to normal. Overall, they were very loyal to the company’s mileage program and, therefore, accustomed to all benefits available to frequent flyers, such as access to VIP areas, frequent upgrades to business and/or first class, priority boarding, ticket discounts and free flights.
After the company lost significant share, new industry players like TAM and OceanAir have tried to fill in the gaps left by VARIG. While TAM offered a similar frequent flyer programme to VARIG, OceanAir focused on offering high quality in-flight services.
Outgoing tourist expenditure
When Brazilians travel abroad, their main expenditure is on accommodation, accounting for approximately R$5 billion. Excursions follows in second place, accounting for R$3.3 billion, or 27 per cent of total outbound expenditure. When booking a package to travel abroad, Brazilians normally like to have excursions included, or at least to receive information about what is available. The ability to speak a second language is not very common among Brazilians, and fly-drive packages are not very popular.
Opportunities
Increasingly, travel products are being segmented for different age groups. In 2005, there were 34 million Brazilians between the ages of 15 and 24, accounting for 20 per cent of the population. As a result, travel products have been introduced in increasing quantity specifically for this age group. Elderly travellers, with a great deal of leisure time on their hands, also received the attention of travel specialists. In 2005, there were 31 million Brazilians over the age of 50.
Young adults are travelling more as well. Studying abroad is popular, with many students staying in English-speaking countries, such as the US, Canada, Australia and the UK.
Travel agencies that specialise in study packages abroad (normally aimed at teenagers and young adults) have found a new niche in the over-50s age group. Since 2003, EF has taken more than 200 middle-aged people on courses abroad. At the beginning of 2005, the company developed a course solely for people of this age group, involving both studies and tourism. The company Central de Intercâmbio saw 15 per cent growth in the first quarter of 2005 in the number of middle-aged people looking for these courses. The favourite destinations are London, Cambridge, Boston and New York.
The addition of international routes by regular as well as low-cost airlines is likely to boost the number of departures in the near future. Currently, GOL and BRA are both waiting on judicial approval to expand their international routes. If these are approved, ticket prices are likely to decline due to increased competition.
| Visitor Data Arrival to Australia from Brazil (2006-07) |
| Temporary Resident |
Student |
Visitor |
Other |
Total |
| 2433 |
7423 |
12098 |
938 |
22892 |
Source: Department of Immigration and Citizenship
Competitive environment
In Brazil, tourism activities are essentially carried out by the private sector. The leading companies in the sector are:
- Accor Hotels Brazil (accommodation)
- TAM and GOL (transportation)
- Localiza Rent-a-car (car rental)
- Carlson Wagonlit Travel (travel agencies)
- Viagens CVC (excursions)
In terms of tourists attractions, national parks attract the largest number of visitors (with Amazon National Park topping the list), but theme and amusement parks bring in the most money.
(Source: Euromonitor International)
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