Chile based LAN Airlines S.A. (LFL) recently reported passenger traffic for March 2010. Total passenger traffic decreased 8.2% year over year with domestic traffic declining 2.9% and international traffic falling 10.2%.
International passenger traffic accounted for approximately 70% of total passenger traffic. The decrease in passenger traffic was attributable to the earthquake that took place in February 2010.
The Santiago International airport remained closed due to the catastrophe leading to the cancellation of numerous flights. Cancellations of flights on routes between Chile and North America also negatively affected international passenger traffic.
However, cargo traffic bloated 30.2% year over year based on improvement in imports to Latin America, and increase in operations to Europe with the Boeing 777-200 freighter fleet.
In January and February 2010, total passenger increased 17.6% and 9.6% respectively. Domestic traffic expanded 10.9% and 7.9% and international traffic stretched 20.6% and 10.4% respectively.
Thus, during the first quarter of 2010, there will be a net increase in passenger traffic. The earthquake was the only reason for the decrease in traffic during March, the effects of which are expected to linger for a little while. Otherwise, Lan’s continuous fleet expansion and renewal program is expected to fetch profitable returns in future.
In December 2009, Lan ordered 30 new Airbus A320 aircraft for its regional and domestic passenger operations, which are to be delivered between 2011 and 2016. In addition, Lan plans to sell five Airbus A318 aircraft in 2011. Lan has also received two new Boeing 767-300 passenger aircraft during the fourth quarter of 2009.
During the fourth quarter of 2009, Lan signed an agreement with Sabre, one of the major operational systems solutions providers globally. Sabre is expected to upgrade and incorporate the most advanced technology in the company’s reservations and distribution system, itinerary optimization and operations planning. These efficiency drivers are expected to improve Lan’s performance.
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