Brazil’s TAM Reached 47.8 Percent Average Domestic Market Share in 2006

TAM S.A. announces operating data for December 2006, as disclosed by the National Civil Aviation Agency (ANAC) today. According to ANAC, TAM registered a 23.6 percent growth in domestic RPK
(demand) compared to the same period last year, and a 23.7 percent increase in
domestic ASK (supply).

In December, market demand increased by 8.1 percent and market supply increased by 12.2 percent. TAM registered a domestic market share (RPK) of 49.1 percent, 6.1 p.p. growth compared to the same period in 2005, but a reduction when compared to November 2006.

This reduction was due to the sharp increase in total market ASK, diluting TAM’s participation to 47.6 percent (versus 51.0 percent in November 2006). TAM’s domestic load factor was 72.3 percent,
higher than the 70.1 percent market average.

In the international market, TAM registered 60.3 percent growth in RPK and 59.1 percent in ASK, compared to December 2005. The company reached a market share of 60.6 percent, representing 39.3 p.p. growth year-on-year. TAM reached a 75.2 percent load factor, higher than the market average 70.6 percent.

The total scheduled yield for the fourth quarter of 2006 slumped compared with the same span of time in 2005, consistent with our strategy to stimulate demand via competitive pricing.

TAM has been the leader in the Brazilian domestic market for more than three years, and held a 49.1 percent domestic market share and 60.6 percent international market share at the end of December 2006. It operates regular flights to 48 destinations throughout Brazil. It serves 74 different cities in the domestic market through regional alliances.