Oct. 30, 2018


Miguel Frasquilho

Portugal

Miguel Frasquilho

Chairman of the board, TAP Air Portugal

“We are the most important European carrier connecting Europe to Brazil and have roughly one-third of the market.”

BIO

Miguel Frasquilho has a Master’s in Economic Theory from Nova School of Business & Economics and graduated in Economics from Católica Lisbon prior to that. He is currently Chairman of the Board of TAP Air Portugal Group and Visiting Professor at Católica Lisbon – Business & Economics, as well as President of the Advisory Board of ACEPI (Portuguese Digital Economy Association). Before this he was Chairman and CEO of AICEP (the Portuguese Trade and Investment Agency), a Member of Parliament with the PSD (Social Democratic Party), a Member of the Special Committee created in 2013 to reform the Corporate Income Tax in Portugal, Managing Director of Espírito Santo Research, and Secretary of State for Treasury and Finance of the XVth Constitutional Government. He author and co-author of several books and articles.

What have been the milestones and major transformations for TAP over the past few years?

TAP Air Portugal was owned by the state until 2015. Due to restrictions in the European framework, TAP Air Portugal was not a profitable company and the Portuguese state could not capitalize the company. Between 2009 and 2015, Portugal had a tough time, with the bailout between 2011 and 2014, and we had a difficult task convincing investors that we were worth investing in. Conversations surrounding the privatization of TAP solidified in 2015 because of Portugal's agreement with Troika, the IMF, the European Commission, and the European Central Bank (ECB). TAP was subsequently privatized and the shareholder agreement was reconfigured so that the state could remain a shareholder. TAP is a successful example of a public-private partnership (PPP); 50% is owned by the state and 50% is owned by private shareholders. It is a company that is extremely dear to Portuguese people, as everyone feels as though they are a part owner of TAP. This ensures a great environment and atmosphere within the company and is also great outside because it does not make room for rumors and creates a calm environment for the company to operate. Since the privatization we have been accomplishing an ambitious strategic plan which complies renovating and expanding our fleet, reaching a lot more destinations, whether in Europe or North America, South America and Africa and, consequently, carrying more passengers.

Can you provide an overview of your key routes and new aircraft?

Currently, our fleet is composed of 90 planes, and the plan is to have 120 or 125 in four or five years. We have also added many new routes. We have an important position in Latin America, mainly in Brazil; we are the most important European carrier connecting Europe to Brazil and have roughly one-third of the market. We serve 10 destinations in Brazil and will serve 12 in one or two years' time. We will expand our operation in North America significantly—both the US and Canada—are more than doubling our destinations in the US. In Canada, we fly to Toronto. We will also expand in Africa and Europe and adding more destinations. From 2019, we plan to fly to Washington, Chicago, Tel Aviv, Montreal, and San Francisco. In Europe, we will have, from Lisbon, Tenerife, Dublin, Basel, Naples, and from Porto, Brussels, Lyon, and Munich. In the coming years, we will have plenty more destinations. TAP is growing significantly, and we are benefiting from (and also contributing to) Portugal's popularity globally. We are experiencing growth pains and need to recruit more pilots and cabin crew and order new planes. There will also come a point when we will need better infrastructure, as we have already been suffering and will continue to suffer from the bottlenecks in the airport (because we are responsible for more than 50% of the traffic in the airport). There are plans to expand Lisbon Airport by opening a new terminal in 2021 – but until then we need improvements in the current infrastructure (facilities, parking for planes, runway, among others), as we want to continue to grow and transport more passengers. In 2017, we reached a new high of 14.5 million passengers, and in 2018 we hope to achieve 16 million. We are growing at a great pace but need the infrastructure to become more productive.

What is the importance of the business class segment, and what is your strategy to increase the customer base of TAP Corporate?

The segment is extremely important. If we want to create more value and ensure passengers remain loyal to the airline, we have to treat them well and ensure we provide excellent service. We are in the process of renovating and expanding the fleet, as I have already mentioned. Many planes are over 15 years old, and we have ordered many new planes from Airbus for long-, medium-, and short-haul flights.

What are your key priorities for 2019?

We seek to continue to grow and grow with quality, meaning serving our customers better. That is what we are more focused on, and with the arrival of the new aircraft, our service onboard and in the airports will be much more efficient and spare customers a great deal of trouble and bureaucracy. We will also look at technological advances where necessary. We are on the right track.

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