MercoPress. South Atlantic News Agency

LAN to lower fares and try new business strategy

LAN Chile, the primary airline in Chile, will begin using the tried and true business strategies that have catapulted low-cost carriers like Southwest and Jet Blue to the top their respective domestic markets.

No more hot meals, more flights that leave early in the morning or late at night, less luxury, economy class only, and most important, lower costs for consumers.

The reason for the switch is increased competition from local bus companies and the recent entrance of Brazilian airline Gol into the Chilean market.

LAN has begun offering cheaper no-frill service to domestic destinations like Puerto Montt and Punta Arenas, representing about 10 percent of their flights. But as part of a larger two year plan, the Chilean carrier will convert 50 percent of their total traffic to this model.

The international destinations soon to have cheaper ticket prices and more modest extras are flights to near destinations like Buenos Aires and Rio. However, the company plans to maintain its traditional service to long-haul destinations like Madrid.

Currently infrastructural obstacles are preventing LAN's switch to non-peak hour service; unlike Santiago, many local airports are not open 24 hours a day, preventing the airline from lowering costs by flying when air space is less crowded.

By Matthew D. Silverman The Santiago Times