Low-cost airline, JetBlue, has announced plans to enter Brazil. David Neeleman, founder and non-executive board chairman of JetBlue, finds a huge opportunity in Brazil – a growing nation where only about five per cent of the population flies.

''The prices that people pay here in Brazil are 50 per cent higher than the prices people pay in the United States,''  Neeleman said in a statement.

This is on account of the duopoly enjoyed by two carriers in the country - TAM Linhas Aereas and Gol Linhas Aereas – who together command almost 90 per cent of Brazil's domestic aviation market. They have enjoyed such dominance since the collapse of Brazil's former flagship carrier Varig some years ago.

Like JetBlue, the US discount carrier that Neeleman founded in 1998, the new Brazilian airline will offer low fares and use a point-to-point route structure that flies travelers from one city to another without layovers.

''Our target market is the 150 million passengers who travel annually by long-distance bus, as well as those, who for lack of a convenient alternative, don't travel at all,'' he said.

Neeleman has decided to stay within the country while sourcing his jets. The carrier, still unnamed, will start with a fleet of three Embraer 195 jets made by the Brazilian manufacturer and should take to the skies at the beginning of 2009, Neeleman said at a news conference in Sao Paulo.

The airline has placed an initial order for 36 of the 118-seater jets, at a contract estimated at $1.4 billion, with the options of 40 more, raising the total contract value to $3 billion. After three years, the airline expects to add one airplane a month to its fleet and have a total 76 aircraft after five years.

The planes will be outfitted with two leather seats on each side of the aisle and live television broadcasts. ''Nobody likes middle seats,'' Neeleman said. A name for the new Brazilian airline has not yet been chosen. He said the name would emerge after consulting the public.

Neeleman said he has already lined up both Brazilian and US investors for a total of $150 million in backing. Neeleman, who was born in Brazil and has both American and Brazilian citizenship, bought a small Brazilian airline called Cheta as a base for the new operation. Dual nationality means restrictions on foreign ownership of airlines, which limit such ownership to 20 per cent, do not apply to him.

Neeleman has had a long history of creating ripples in air travel throughout the world. He started out by selling package tours to Hawaii as a college student before co-founding discount carrier Morris Air in 1984. In 1993, he sold Morris to Southwest Airlines for $22 million in stock. Five years later he started JetBlue, whose low-cost business model and customer perks such as live television and leather seats helped redefine air travel.

Last May, Neeleman was ousted as JetBlue's chief executive after an embarrassing service meltdown that left thousands of passengers stranded and cost the airline more than $30 million. The board then replaced him as chairman in June 2007, naming him a non-executive chairman, a post he currently holds.

Neeleman said he would stay on as chairman of JetBlue but that there is no conflict because he is no longer involved in JetBlue's day-to-day operations after his departure as CEO and chairman last year.