Brazil's Tam Could Operate Regional Flights With Embraer Planes, Report Says

    SAO PAULO--Brazil's Tam Linhas Aereas SA--which last year was taken over by Chile's Lan Airlines Group SA to form the region's leading airline by revenue, Latam Airlines Group (LFL, LAN.SN)--may go back to its roots as a regional carrier, and could buy Embraer SA (ERJ, EMBR3.BR) planes to operate the shorter routes, the newspaper O Estado de S. Paulo reported Monday.

    Tam, which currently dominates Brazil's international routes as well as trips between the country's major cities, could start offering flights to smaller cities as Brazil's government offers incentives to expand regional aviation, Tam President Claudia Sender told the paper.

    Tam got its start as a regional carrier in the interior of the state of Sao Paulo. The government has said it could subsidize routes between smaller cities, as well as investing heavily in regional airports. Tam could increase regional flights depending on how the government incentives work out, the newspaper said, citing Ms. Sender.

    To operate those flights, Tam is studying buying ATR or Embraer airplanes, Ms. Sender told the newspaper. Tam, which currently operates Airbus and Boeing planes, is in talks with Embraer, but a lot of details still need to be worked out, Ms. Sender said, according to the paper.

    Tam didn't reply to an email seeking comment.

    Write to Paulo Winterstein at