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Spotlight

LATAM Airlines

Thu, 12/01/2016 - 14:00

With 130 years in the aviation industry between them, in 2010 LAN and TAM airlines publicly declared their intention to marry both companies into one single holding: LATAM Airlines Group.

The merger was formalized in 2012 and the group unveiled a new brand image in 2016. The merger between the Chilean LAN and the Brazilian TAM created one of the largest airline groups in the world. LATAM Airlines employs more than 40,000 people, has an aircraft fleet of 328 units and offers flights to 136 cities in 24 different countries, in addition to its cargo services to 140 different destinations in 29 countries. In Mexico, LATAM operates from Mexico City and Cancun.

All the companies that were part of the LAN Airlines Group and its subsidiaries in Peru, Argentina, Colombia and Ecuador are now under the LATAM umbrella, along with TAM Airlines, TAM Air Transports of Mercosur, TAM Airlines Paraguay and cargo companies LAN Cargo, LAN Cargo Colombia, ABSA Cargo Airline and MasAir, now part of LATAM Cargo.

In Latin America, the airline is responsible for moving twothirds of all passengers. It is one of the top three airline groups in the world. The marriage also has a financial benefit: a 5 percent expected reduction in operating costs in 2018.

The strategy followed by LATAM is based on network leadership, brand leadership and customer experience, cost competitiveness and organizational strength. LATAM is the only airline in the world with seven subsidiaries in addition to its international operations: Argentina, Brazil, Chile, Paraguay, Colombia, Ecuador and Peru. Its main hubs are located in Santiago, Lima, Sao Paulo and Bogota. Lima is especially important for connections with Mexico and flights between both locations are growing promisingly.

Environmental concerns are important for the group. For example, the paint used on its airplanes is 25 percent lighter than conventional paint, which will help reduce each craft’s weight by 20kg on average. This weight reduction is expected to reduce CO2 pollution by 3,900 tons every year.

The group’s extended presence in South America, its diversified revenue base, a low-cost business model for domestic operations, its modern fleet and loyalty programs are among the company’s strengths. In May 2016, the first planes with LATAM’s new branding took off. The airline expects to have around 50 airplanes branded by the end of 2016, with the entire fleet sporting the new look by 2018.