TAP Air Portugal’s yearly deficit in 2021 was $1.74 billion, according to the airline’s chief executive, who confirmed the news at a press conference on April 11, 2022.
TAP attributed the loss in part to the shutdown of its aircraft maintenance unit in Brazil, which resulted in a $1.1 billion loss. Under a $3.4 billion bailout package agreed by Brussels, the airline was compelled to liquidate its maintenance division.
The airline was also compelled to reduce its fleet size, slash over 2,900 employees, and severely lower wages under the provisions of the rescue plan, which was approved in December 2021.
External problems, such as the uncertainties around COVID-19, also hampered the airline’s operational capacities in 2021.
TAP Air Portugal carried more than 5.8 million passengers in 2021, a 25% increase over the previous year. However, the latest result only accounts for 34% of the pre-pandemic demand reported in 2019.
Rising inflation and the cost of airplane fuel, according to the airline’s CEO Christine Ourmières-Widener, could pose more challenges in the future.
To deal with the upcoming financial challenges, the carrier will need to “continue to perform in line” with its restructuring plan, Ourmières-Widener said.
