DAVID KNIBB SEATTLE Continental Airlines has made the unlikely choice of a military-run airline as its partner in Peru. The US airline is to give operating assistance to TANS (Transportes Aéreos de la Selva) in exchange for domestic feed to and from routes within Peru.

Continental hopes to codeshare with its prospective partner between, beyond, and behind gateways.

TANS is the third partner the US airline has considered in Peru. Twice it tried to forge an alliance with AeroPeru. Once it was trumped by Delta Air Lines. More recently, Continental turned down a second chance to invest in the flag carrier. AeroPeru is now in liquidation. According to sources in the Peruvian capital Lima, Continental also talked a year ago with Transportes Aéreos Andahuaylas, but nothing came of it.

The Continental-TANS pact is a work in progress. TANS is owned and operated by Peru's national air force. For years it only flew missionary routes into remote parts of the Amazon. Recently, however, at the behest of Peru's President Fujimori, TANS has acquired four Boeing 737-200s and expanded its network to all major domestic routes. This dismayed privately owned airlines, which complained they were forced to compete with a government-owned carrier. But Fujimori has persisted because so many local airlines have failed, and TANS seems to be capable of providing reliable services.

Continental has picked such a partner because "TANS is the only carrier [in Peru] which is not in a rush to fly to the USA", explains Mario Garrido, a US-based aviation specialist from Peru. "I believe TANS will want to focus on the Latin American routes left by AeroPeru instead of entering a fare war with Aerocontinente and LanPeru for the Miami route."

AeroPeru's routes were expected to become available for re-allocation last month, when AeroPeru's authority was due to lapse. TANS will enter into competition with at least four other Peruvian carriers for those routes. Two of them have close ties to alliance partners of American Airlines, namely LanChile and Grupo TACA.

Continental's relationship with TANS coincides with the latter's launch as a civilian airline. In response to concerns about a military carrier operating scheduled civilian flights and whether that might jeopardise Peru's Category I rating under the USA's safety assessment programme, TANS went through Peru's civil certification process in March. Hector Arce, a former director of AeroPeru, became managing director. TANS aims to switch from a military to civilian operating licence in November.

Source: Airline Business