At a time when domestic airlines are cutting costs by laying off pilots, adding extraneous baggage fees and dropping flights, South America’s LAN Airlines — which flies out of Los Angeles, New York and Miami — is a rare exception.
Just last year, the Santiago, Chile-based airline committed to buying 32 brand-new Boeing 787 Dreamliners — a $3.5 billion investment — and its most recent first quarter results showed a net income of $91 million. In June, the Official Airline Guide awarded LAN with its seventh win for Best Airline in Central/South America. That’s not all: This year marks the 50th anniversary of operating to the U.S. To celebrate, the airline has plenty of events and promotions lined up.
“We’re still having a good year,” Pablo Yunis, LAN vice president, North/Central America told TravelAge West.
While Yunis is pleased with the airline’s performance, he’s not content to rest on his laurels, however.
“You see the predictions [for the airline industry] and they’re not good, especially for the big companies that have pretty big cost factors,” he said. “If the fuel price continues like this, you will see a completely different business in the next two years. You have to change all your business models and adapt.”
To do so, Yunis said LAN will rely on its strengths: diversified revenues (more than 30 percent of LAN’s revenue comes from the cargo business) and high-quality service. An example of such is LAN’s new and improved business and economy class seats on its Boeing 767s. Improvements include full-flat beds throughout business class, increased recline in economy seating and individual television screens in both business and economy classes.
Servicing travel agents is not lost on Yunis, either.
“We continuously are working with travel agencies. We’ve been working with them for years and we expect to be working with them for years to come,” Yunis said. “We’re trying to educate [agents] about the destinations that we fly to and we want to develop some tools for them to sell our destinations.”
One such resource is the soon-to-be-launched Mundo LAN — an interactive Web tool agents can use to sell LAN and its destinations to their clients.
“On the new site, [agents] will be able to request groups and much more. We’re going to centralize a lot of information and the things they will use to facilitate the way they sell LAN. We expect it to be a very useful tool for them,” Yunis said.
And now, said Yunis, is a perfect time to send clients to South America, especially considering the rocky economy.
“South America, right now, is booming and it’s very inexpensive especially compared to Europe,” he said. “It’s a place that’s still very relatively cheap and you can have a very nice couple of weeks’ vacation [there] for the same price you would spend in three or four days in Europe.”
LAN offers a number of flights to South American hot spots, including those in Chile and Peru. Lima, in particular, Yunis noted, is a key destination for the western U.S. since LAN offers 11 flights weekly between Los Angeles and Lima. Last year, LAN also launched a new nonstop flight from Los Angeles to Santiago which Yunis said is very popular with summer cruisers.
Yunis was also quick to point out that LAN is part of Oneworld and its partnerships with American Airlines and Alaska Airlines allows the airline to transports passengers from throughout the U.S.
“We are basically connecting to more than 40 cities within the U.S.,” he said. “You shouldn’t only look for LAN out of Los Angeles. You can sell tickets to clients from anywhere, especially in the West. It’s part of our strategy this year to bring more clients from those non-gateway cities.”
While Yunis said LAN isn’t planning to expand in the near future, he sees huge potential for growth in the long run. LAN’s long-term strategy includes expansion to other U.S. cities, added routes and more frequencies. Here in the West, said Yunis, San Francisco is a key potential gateway.
“We know that, in South America, we are the leading carrier and to continue to do that we have to grow and North America is definitely part of that plan.”