New Competition in Chilean Airspace

Since the early 1980s, Chile’s privatized flagship LAN Airlines has dominated the country’s airways with upwards of 80 percent of domestic passenger traffic, and by consensus it’s one of the region’s best - if not the best - air carriers. Its international service is probably superior to any other airline flying to South America from Europe, North America, and the South Pacific. It is also solvent.

Within Chile’s borders, since the late 1980s, a long list of competitors - Aerocontinente [2], Air Comet [3], Avant Airlines [4], Ladeco [5], and National Airlines - has come and gone. In recent years, Sky Airline [6] appears to have achieved viability but, given the hard times for the global airline industry, you never know.

Given the difficulties of competing with LAN, it’s surprising to see a new Chilean carrier, Principal Airlines [7], about to begin services from Santiago to the Atacama Desert cities of Antofagasta and Iquique. According to Mercopress [8], Principal is a direct descendant of National Airlines and has operated as a charter carrier since 2003. Services are due to start June 18 and, even if the company eventually fails, there are some good deals to be had for the moment - fares will start around US$50, which is more than competitive with bus fares on the 18-hour overland route to Antofagasta.