The government of Portugal has announced plans to begin negotiations for the partial privatization of TAP Air Portugal, the country’s flag carrier airline. Two major European airlines, Air France-KLM and Lufthansa, have expressed interest in acquiring a stake in the company. Both submitted offers by the end of July, which officials have described as undergoing a "very close overall evaluation." According to Antonio Leitao Amaro, a spokesperson for Portugal’s government, the evaluation suggests that further negotiations are needed to secure "improved proposals." The government aims to complete the process in the coming weeks, with plans to sell up to 49.9% of TAP’s capital. A portion of this stake—specifically 5%—will be reserved for the company’s employees. Air France-KLM has confirmed its interest in the privatization, stating that its involvement reflects a "constant and determined interest" in the process. The airline group submitted its offer on July 29 and presented a strategic plan that covers all aspects of TAP’s operations, including passenger flights, cargo transport, a loyalty program, and aircraft maintenance. This comprehensive approach suggests that Air France-KLM is looking to not only acquire a stake but also to influence the airline’s future direction. TAP Air Portugal has faced financial difficulties in recent years. In the second quarter of 2024, the airline reported a net loss of 59.3 million euros, a sharp decline from a profit of 38.3 million euros in the same period of 2023. The loss is largely attributed to rising fuel prices, which have significantly increased operating costs for airlines worldwide. This financial struggle follows a period of emergency nationalization in 2020, when the government took control of TAP to help it survive the economic fallout of the Covid-19 pandemic. To receive 3.2 billion euros in public aid during the pandemic, TAP was required to implement a restructuring plan, which was monitored by the European Commission. This plan, launched in 2021, aimed to modernize the airline’s operations and improve its financial stability. Today, TAP operates a fleet of about 100 Airbus aircraft and employs around 7,700 people, including 1,200 pilots. The privatization is seen as a step toward restoring the airline’s financial health and long-term viability.