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Aviation History
1999
1999 - 2005.PDF
Mm TRANSPORT Some of the A319s/A320s ordered by LanChile will replace the 737-200s on subsidiary Ladeco 'sfleet operations: 737-200s (12), 767s (12 -300ERs, two 767-300s), and the four DC-8-71Fs in the cargo operation. To replace the ageing 737s, LanChile has 11 Airbus Industrie A319s and nine A3 20s on firm order for delivery starting toward die end of 2000, with options on nine more A319s and 11 A320s. Some ofthese will go to replace the 737-200s in the fleet of LanChile's domestic subsidiary Ladeco. He calculates the market is ready for the increase in aircraft size from the 737-200 to the A3 20 series, adding diat the first Airbus will be FIRST FROM SECOND LANCHILE been "working to be one of the 10 best airlines in the world," Cueto says. He sets about defining what he means. "When you fly to the Far East you choose an airline - perhaps Singapore Airlines. When people fly to South America we want them to think of LanChile first." Cueto emphasises that acceptance into one of the dominant glob al alliances such as oneworld, when your airline is from what he calls "the second world" is not a foregone conclusion. "Part of our success is that LanChile has a very good safety reputation. Safety is our main objective. In this region it's more impor tant. When you fly in the US market you know the name of the company, but you do not have to ask if it is safe. But in this part of the world you need a reputation." Cueto says LanChile has been voted the best provider of air transport from the USA to South America. LanChile, however, has to set its sights on providing services as well and as efficiently as airlines like British used on cross-border regional routes in Latin America such as Lima in Peru and Buenos Aires in Argentina. Later deliveries will operate on do mestic routes. The A320orderwasnegotiatedin conjunction with fellow South American airlines TAM (Brazil) and TACA (El Salvador). Independently, however, LanChile has ordered seven Airbus A340s for delivery start ing in August 2 000, with options on seven more, although the airline has not officially confirmed the order yet. Cueto emphasises the need for longer-range widebodies to enable non-stop Airways, American Airlines, Lufthansa, United Airlines and Air France, says Cueto. "It is not easy for a company of the second world to compete with a company of the first world, because [in the country itself] services are not as efficient, the resources are not the same. It is not only an econom ic issue, especially for a service company. We need education. The attitude of our people is good, but if you come from Europe there are many things you do not need to teach employees. In Chile we do not have the same professionalism, culture of safety, service, knowledge about lan guage, culture, wines, and food," he says. Whatever reservations Cueto has about Chile's Umitations, it is coming out on top in safety oversight. Eight Latin American nations have had their safety oversight classified Category II (provisional) under the US FAA International Aviation Safety Assessment Programme, and eight more classified Category III (unacceptable), but Chile was classified Category I (safe). Santiago-Europe flights with a full payload. At present, the 767s must stage through Sao Paulo, Brazil. On the Pacific side, LanChile links into the Qantas network at Tahiti, from which it continues to Auckland, New Zealand and Sydney in Australia. Any Pacific expansion would be co-ordinated with Qantas, a oneworld partner, says Cueto. Among LanChile's markets, the USA, Peru, Spain and Argentina are still strong, although yields have dropped as international competi tion has increased. Cueto says Argentina and Peru are the main South American markets in which LanChile aims for development. Recent indicators look positive: LanChile's May on May freight figures show a 3 5 % rise, to 133 million tonne/km. May passenger traffic was up by 16% witha9% capacity increase, rais ing the load factor by four points to 59%. The airline saw its best growth in interna tional traffic, up by almost 27%, although yields were down by 15%, partly because of fewer pre mium passengers and partly because of a fares drop, says Cueto. He maintains that the main effect of the Asian economic crisis on the rest of the world is that airline capacity withdrawn from Asia-Pacific was dumped elsewhere. Meanwhile, domestic revenue passenger kilometres dived by 14% and the carrier cut domestic capacity by 15% to compensate. Before lastyear, Cueto says, LanChile's domes tic business was growing at 20% a year, "but now it is not growing". But Cueto says that, among the cross-border regional routes, only those to Brazil show "neg ative growth", and any Brazilian recovery is still over the horizon. LanChile seems well prepared for the Latin American battle, arming itself with flexibility, aggressive expansion, high quality and its repu tation for safety. Q 28 FLIGHT INTERNATIONAL 7 - 13 July 1999
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