Peru's domestic market last year surged by 28% to 5.5 million passengers while the country's international market grew 5% to just over 5 million passengers.

New data from Peru's DGAC shows the domestic market grew for the eighth consecutive year in 2010. Traffic also exceeded the 5 million mark for the first time in Peru's history, as 5.5 million passengers were carried by the country's domestic carriers compared to 4.3 million in 2009. Back in 2002, Peru's domestic market consisted of only 2.2 million passengers.

Traffic in Peru's international market also increased for the eighth consecutive year and exceeded 5 million passengers for the first time. Back in 2002, when the current trend of increasing domestic and international traffic began, Peru had just under 2 million international passengers.

Market leader Lan Peru recorded a 13% increase in domestic traffic from 3.4 million in 2009 to 3.8 million passengers in 2010. But Lan Peru's domestic market share dropped last year from 79.6% to 70.3% due to the rapid expansion of the country's second and third largest domestic carriers - Star Peru and Peruvian Airlines.

Star Peru saw its domestic traffic increase 31% to 659,000 passengers. Star Peru, which has been expanding its BAe 146 fleet, saw its domestic market share increase from 11.8% to 12.1%.

Peruvian Airlines, which only launched services in late 2009 with Boeing 737-200s, carried 610,000 passengers last year. The carrier captured 11.2% of the domestic market.

TACA Peru is currently the country's fourth largest domestic carrier, carrying 147,000 domestic passengers last year for a 2.7% share of the market. TACA Peru until this month was primarily an international operator and only served one domestic route. But TACA Peru is launching three domestic routes next week and is looking to add more domestic services later this year as part of a second phase of its domestic expansion.

A group of 20 small carriers accounted for the remaining 3.7% of Peru's domestic market last year, including operators of small fixed wing aircraft and helicopters.

Internationally, LAN and TACA have both been expanding rapidly in Peru in recent months, opening several new routes. But in 2010 TACA Peru saw its international traffic decrease for the second consecutive year while Lan Peru recorded its ninth consecutive year of increasing international traffic.

Lan Peru carried 1.5 million international passengers in 2010, compared to 1.4 million in 2009. In 2010 the carrier had a leading 30.3% share of Peru's international market.

TACA Peru, meanwhile, carried, 576,000 passengers in 2010 compared to 683,000 the prior year. TACA Peru had an 11.5% share of the Peru's international market in 2010.

The remaining 58% of Peru's international passengers was predominately carried by foreign carriers as Star Peru and Peruvian Airlines have only limited international services. Lan Chile was the largest international carrier with an 11.6% share of the market. Lan Argentina also had 2% of the market, giving the Chile-based LAN group a commanding 43.9% share of the total international market.

Colombia's Avianca had a 4% share and TACA's Costa Rican unit Lacsa had a 1% share, giving the Avianca-TACA group a combined 16.5% share.

American was the second largest foreign carrier in Peru last year with a 6.3% share of the total international market, followed by Iberia with a 6.2% share, Panama's Copa with 5.6% and Continental Airlines with 4.1%.

Source: Air Transport Intelligence news