Bs Mai 07

Bear Stearns Global Transportation Conference

New York, May 2007

2

164.2

138.7

116.1

103.7110.1109.1

100.0 115.5111.4108.8103.4103.2101.3100.0

100

139

126.4 118.3

143.6

207.7

270.3

2000 2001 2002 2003 2004 2005 2006

Domestic Market with High Growth Potential

Source: ANAC, IBGE, and TAM’s Annual Reports

Growth of Brazilian Domestic Market

RPK

GDP

1.70

1.85

2.32

0.62

0.60

0.55

0.50

0.82

Japan

US

Argentina

Chile

Mexico

Russia

Brazil

Boardings per capita

Boardings per capita, adjusted by GDP per capita at PPP

Source: World Bank Data, Credit Suisse Research as of 2005

TAM’s RPK

Annual Trips / Person

Germany

3

74.1

104.698.090.491.294.0100.0

100.0 104.1

221.4180.6

260.7

360.4

505.8

2000 2001 2002 2003 2004 2005 2006

International Market Overview

Source: ANAC and IBGE

2004

2005

2006

Intl. carriersBrazilian carriers

46%

Growth of Brazilian International Market International Traffic (in %)

Imbalance / RPK Disruption created in 2006 due to Varig’s

bankruptcy

RPK

TAM’s RPK

47%

28%

4

Low Cost Airline with Better Service

Low OperatingCosts

IndisputablyBetter Service

CompetitivePrices

Sustainable Strategyto Maintain Market

Leadershipand Profitability

5

19.2% 21.8%

30.7%34.9% 33.0%

35.8%

43.5%47.8%

27.2%

1998 1999 2000 2001 2002 2003 2004 2005 2006

TAM is the Leading Domestic Airline since 2003...

Domestic Market Share (RPK’s)

Source: ANAC

BRA 3,4%

Varig 4,6%

Other 5,1%

TAM 48,5%

GOL 38,5%

TAM 51,70%

GOL37,1%

Other 4,8%

Varig 4,7%

BRA 3,9%

Domestic Market Share (RPK’s) – 1Q07 Domestic Market Share (RPK’s) - Mar/07

6

% Total Domestic Passengers Boarded

Important barrier to entry for newcomers

Limited ability for other competitors to grow

10 main airports in Brazil carry 70% of all passenger traffic

TAM has in aggregate ~40% of all slots available in these airports

% TAM slots

… controlling ~40% of Slots at 10 Largest Airports

Congonhas

Brasília

Guarulhos

SantosDumont

Galeão

Salvador

Confins

PortoAlegre

Curitiba

Recife

0 2 4 6 8 10 12 14 16 18 20

46%

52%

31%

37%

33%

42%

47%

31%

36%

46%

Source: ANAC

7

0,1%3,8%

13,9% 12,5% 12,0%14,3%

18,8%

37,3%

7,9%

1998 1999 2000 2001 2002 2003 2004 2005 2006

International Market Share (RPK’s)

TAM is the International Market Leader since 20061,…

Note 1: among Brazilian airlinesSource: ANAC

TAM 60,9%

Varig12,1%

GOL 17,9%

Other9,1%

Varig11,0%

TAM61,0%

GOL18,3%

Other7,8%

International Market Share– 1Q07 International Market Share– Mar/07

8

…with Diversified International Routes

Long haul market Paris1 3x per day London 1x per day NY 2x per day Miami 3x per day Milan2 1x per day

Latin American market Buenos Aires 7x per day Santiago 2x per day Asuncion 8x per day Lima 1x per day Montevideo 1x per day Ciudad del Este 3x per day Sta Cruz dl Sierra 1x per day Cochabamba 1x per day Cordoba 1x per day

Note 1: 3rd daily flight to Paris started in January 2007Note 2: Started on March 30, 2007

Selected Network Coverage to 3 Continents Leading Brazilian International Carrier

9

Strong Financial and Operating Results in 2006...

Net revenues EBITDAR

Margin % EBIT

Margin % Net income

Margin % RASK (R$ cents) CASK (R$ cents) Spread (R$ cents) ASK (MM) RPK (MM) Net Rev. Passengers (K) Load Factor Daily block hours per

day

2003 2004 2005 2006

3,59177522

(32)(1)174

519.9520.13(0.18)18,00310,91611,19860.6%

7.6

4,5201,039

23295

7341

821.5320.121.41

20,99913,85413,52266.0%

9.0

5,6491,140

204258

1873

20.1618.631.53

28,02419,79719,57170.6%11.4

7,3451,817

2599614

5568

20.6517.852.80

35,56426,28925,02273.9%12.7

BRGAAP – R$ MMCAGR02-06

26.9%32.8%

214.5%

47.3%

1.1%(3.9%)

25.4%34.0%30.7%

10

(R$ MM)

2003 2004 2005 2006

172 297

995

2,453

...Enhanced TAM's Solid Financial Condition

21%

79%

28%

72%

4Q05 4Q06Note 2: Includes revenues passenger and cargo

DomesticInternational

Liquidity1

Adjusted Debt 3 / Adjusted Cap (%)

Increasing International Revenues2

2003 2004 2005 2006

6,1335,160 5,030

6,2907.7x

4.7x 3.5x

2.1x

Net adjusted Debt3 / EBITDAR

Total Adjusted Debt

(R$ MM)

Gross Debt3

Note 3: Adjusted for capitalized leases

Note 1: Cash and banks, and financial investments

99 9687 81

2003 2004 2005 2006

11

Average domestic market share above 50% Average domestic load factor at

approximately 70% Aircraft utilization per day (block hour)

higher than 13 hours Reduction of 7% in total CASK ex-fuel in BR

GAAP yoy Opportunity in the international market

Third frequency to Paris Inauguration of two new international

long haul frequencies

Market demand growth from 10% to 15% (in RPK terms)

TAM

Market

Guidance for 2007

12.1%

• Since January• Milan since

March 30

48.5%70.5%

NA

NA

Guidance 2007 1Q07

12

~30% increase in ASKs At least an additional 3

destinations Strengthening of international

gateways for domestic market Guarulhos Galeão

Increasing of frequency on main domestic markets Brasília Congonhas Confins

Implementing over hub flights: new city-pairs

~60-70% increase in ASKs Additional daily frequency to

Paris beginning in January New flight to Milan in 1H07 Additional long haul frequency

or destination to be disclosed Strengthening of Latin American

presence, through addition of frequencies and destinations

Expansion of Frequencies and Destinations

Domestic Market 2007 International Market 2007

13

Fleet and network Distribution costs Overhead

Increase of block hours to over 13 hours per day per aircraft in 2007

6 extra seats in the A319/320 fleet

Increase in direct sales through: Site improvement Fare bundles Call center

outsourcing New means of

payment In sourcing of

representatives Adjusting indirect

sales commissions to higher % on off-peak flights

Outsourcing of non-core activities

Redefinition of service standards

Review of spans & layers in the org. structure

Implementation of new automated processes

Improved sourcing capabilities

Aggressive Cost Targets

14

Fleet Expansion Plan

TAM will be monofleet in the domestic market by 1H08

21

64 88 103 106 112

1012

14 1616

6

44

43

7.8 yrs

7.0 yrs6.0 yrs

5.0 yrs6.0 yrs

0

20

40

60

80

100

120

140

2006 2007 2008 2009 2010

Num

ber o

f Airc

raft

s

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0A

verage Fleet Age (years)

F100 A319/320 A330 B777 MD11 Avg fleet age

95109

121

126

132

15

Recent Developments

Innovative Services: Fare Bundles launched in 4Q06 (website sales increased by 40% in the 1st month)

Inclusion in the Corporate Sustainability Index (ISE)

IOSA certification was obtained in Jan 2007 (IATA Operational Safety Audit)

Section 404 of the Sarbanes-Oxley Act (SOX) Certification

Code-share with TAP operating by next July, translating into a significant increase of flight options for passengers, as well as into the linkage of the companies' mileage programs, TAM's Fidelidade and TAP's Victoria

On April 25, 2007 closed an offering of US$300 million 7.375% Senior Notes due 2017

16

One of the Best Airlines in the World

Source: Public Reports of December 31, 2006 (except for Air Asia and Malaysia, which refer to 2005 figures)

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

8.0 13.0 18.0 23.0 28.0 33.0 38.02006 EBITDAR Margin (%)

Cash

Cos

ts (

$ ce

nts/

ASK)

17

Contact details

Investor Relations

Phone: +55 11 5582 9715

Fax: +55 11 5582 8149

Email: [email protected]

Site: www.tam.com.br/ri

18