Brazilian TAM to reduce domestic capacity next year

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SAO PAULO, Brazil - TAM Airlines' chief executive said in a newspaper interview published on Friday that Brazilian carrier plans to cut domestic routes in 2013 to restore profitability in the face of high fuel costs and cooling demand.

The outlook reinforces a continued emphasis on cost-cutting under LATAM Airlines Group , the regional giant formed in a takeover by Chile's LAN Airlines.

Reuters reports that TAM plans to cut its domestic routes by 7 percent in 2013, following a 2 percent reduction this year, Chief Executive Marco Antonio Bologna told newspaper Valor Economico. A spokeswoman for TAM in Brazil confirmed the details of the interview.

TAM's fleet in the country will shrink to 109 from 114 next year, easing pressure on ticket prices that plunged last year amid a battle for market share with Gol Linhas Aereas , Brazil's second largest airline.

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