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DESTINATIONS South America


San Rafael Glacier in Patagonia,Chile


terms that places the country behind markets such as China – on 9% – where LCCs remain restricted in their operation. “The political challenges and


protectionism are similar in Central America but it has been harder to protect because of its proximity to the US and the US LCCs,” Grant says. And it is Central America that provides a


potential solution for other Latam countries. The region has a population of 45 million and for many years has had a common air market under the Central American Common Market (CACM), which dates back to 1960. According to the Centre for Aviation,


the LCC penetration rate in the CACM is approximately 11%. Intra-Central American travel now has six main city pairs served by a low-cost option, with five served by Volaris and one by Copa’s new LCC brand, Wingo. The benefits in terms of competition


and price can be inferred from the difference in penetration of LCCs in those respective regions. According to figures from OAG, penetration is 9.7% in Costa Rica and 12.3% in Guatemala. This compares with Chile on 0.8% and Argentina on 2.7% However, the number of the airlines is


growing, with JetSMART becoming the fourth LCC to launch in Latin America during the past year, joining Viva Air Peru, Colombia’s Wingo (part of the Copa group) and Volaris Costa Rica. With these start-ups the number of Latin American LCCs has increased from seven to 11. In addition, Flybondi is set to launch later this year in Argentina.


And while the airlines are there, the principle of open skies is also well established in the region, with Colombia, Chile, Peru, Brazil, Paraguay and Uruguay all having separate agreements with the US. Furthermore, the following central


62 ISSUE 5 ROUTES NEWS 2017 routesonline.com


JetSmart facts & stats


American countries also have open skies agreements with the US: Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. Grant says that in the past five years, the political openness to Open Skies between South American countries has increased. He adds: “Administrations are becoming pragmatic. They realise it’s not a national issue, it’s an international issue.” Ortiz also argues that the benefits of lowering barriers would be a boon for the emerging middle class. He says “We believe free markets allow


Founded: 2016 First flight: July 25, 2017


for further competition and improves the quality and diversity of air service. It ultimately benefits consumers, as they will have more options; and therefore tourism and economic growth is fostered.” Grant agrees, saying governments in the south are realising that open skies will stimulate more travel, more hotel stays, more flights and overall, more economic activity and wealth. “It’s a win-win,” he says. £


Based: Santiago Arturo Merino Benitez International, Chile


Fleet: Two Airbus A320-200s, with projected deliveries to reach nine aircraft by the end of 2018 Domestic destinations: Santiago, Concepción, Puerto Montt,


Temuco, La Serena, Copiapó, Calama and Antofagasta


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