oksman
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LAN And TAM Merger Approved

Wed Dec 14, 2011 8:01 pm

CADE approved today fusion between TAM and LAN, creating the biggest airline in South America, under the condition that one of the airlines drops its alliance membership and some slots between SCL and GRU

Sorry link only in Portuguese

http://economia.uol.com.br/ultimas-n...tricoes-fusao-entre-tam-e-lan.jhtm

Correct me if I´m wrong, but wouldn´t be better for competition if they remain in different alliances?

[Edited 2011-12-14 12:08:24]

[Edited 2011-12-14 12:13:33]
 
scrappy27
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 8:12 pm

oooooo interesting... I hope they remain in oneworld....
 
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IrishAyes
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 8:26 pm

Quoting oksman (Thread starter):
Correct me if I´m wrong, but wouldn´t be better for competition if they remain in different alliances?

In an ideal world, yes, but the terms are clear in that they need to be in the same alliance, and that alliance cannot involve Avianca-Taca.

That said, the benefits of a merger outweigh the costs of two separate airlines in two separate alliances; therefore, the signs indicate they are indeed headed to OneWorld. In my opinion, a decision and situation that makes much more sense on paper.
confidence is silent. insecurities are loud.
 
VC10er
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:24 pm

Interesting if Star would dump one for the other. Wouldn't be the first time in life! Ask Jenniffer Aniston  
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LHRFlyer
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:38 pm

 
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Zkpilot
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:40 pm

Are there any airlines left in South America? LAN seems to have gobbled up the whole continent! AR is in pretty bad shape.
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notaxonrotax
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:48 pm

Interesting.
I can't say I care for either airline too much; both livery and service wise; but there you go.

No significant competition in SA--> prizes will hit the roof before their planes will.

SCL767 replying to this thread in 3,2,1......

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hiflyer
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:55 pm

with AA in chapt 11 going to OneWorld right now is risky...AA needs to flood South America with aircraft to build revenue to support restructuring....gonna be interesting if they do go that way......
 
steve6666
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:56 pm

Quoting notaxonrotax (Reply 6):
No significant competition in SA--> prizes will hit the roof before their planes will

Prices already have hit the roof, if you tried looking for some fares on LAN or TAM recently. I paid over US$1000 for a return from GRU to MAO last week, and the ponte aerea from Congonhas to Santos Dumont I regularly get quotes of over US$500 for ONE LEG on TAM.
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mogandoCI
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 9:57 pm

Quoting VC10er (Reply 3):

Interesting if Star would dump one for the other. Wouldn't be the first time in life! Ask Jenniffer Aniston  

If AviancaBrasil comes onboard and grows properly, then the net lost versus gaining Avianca-Taca is close to a wash. TAP is more than sufficient connecting Brazil to Europe (on top of other partners), while United connects GRU with 4 US cities.

Sad loss, but not the end of the world for Star Alliance.
 
miner
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:02 pm

Quoting hiflyer (Reply 7):
with AA in chapt 11 going to OneWorld right now is risky.

I can't seem to see the issue here. Some of AA's most profitable routes are in South America. AA's CH.11 is a reboot, not a death sentence. This is the best time to consolidate that market and by getting a partner like TAM in Brazil to feed traffic to AA aside from their OW partner LAN, is an excellent thing.
 
aloges
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:04 pm

Oh, God no...  

Quoting notaxonrotax (Reply 6):
No significant competition in SA--> prices will hit the roof before their planes will.

There is already far too little competition, this will only make it worse. LAN and TAM are my favourite Latin American airlines, although it's been a while since I've flown either. I firmly believe that it would be better for the passenger if they continued to compete rather than form a giant quasi-monopoly.
Don't cry because it's over, smile because it happened.
 
andrefranca
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:16 pm

Quoting steve6666 (Reply 8):
Prices already have hit the roof, if you tried looking for some fares on LAN or TAM recently. I paid over US$1000 for a return from GRU to MAO last week, and the ponte aerea from Congonhas to Santos Dumont I regularly get quotes of over US$500 for ONE LEG on TAM.

this is crazy.... well that's the why I'll stick to CM now! 

or take our new motto: Azul (jetblue), aZUL, AzuL, Azuuul LOL....
 
gen2stew
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:22 pm

I'll wager a large amout of anything that LATAM is getting some sweet offers from all interested parties (Sky+Star to switch and OW to stay)!   
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gen2stew
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:23 pm

When are expecting an alliance decision?
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kiwiandrew

RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:34 pm

Quoting IrishAyes (Reply 2):
That said, the benefits of a merger outweigh the costs of two separate airlines in two separate alliances; therefore, the signs indicate they are indeed headed to OneWorld. In my opinion, a decision and situation that makes much more sense on paper.

Benefits to whom? Not too sure that having LATAM and AA in the same alliance makes sense for the consumer - that will be a pretty dominant combo.

Quoting mogandoCI (Reply 9):
If AviancaBrasil comes onboard and grows properly, then the net lost versus gaining Avianca-Taca is close to a wash.

The question is how are they going to grow properly when GRU in particular, is slot constrained?
 
tommytoyz
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:35 pm

Quoting steve6666 (Reply 8):
rices already have hit the roof, if you tried looking for some fares on LAN or TAM recently. I paid over US$1000 for a return from GRU to MAO last week, and the ponte aerea from Congonhas to Santos Dumont I regularly get quotes of over US$500 for ONE LEG on TAM.

It's true, absolutely crazy high air ticket prices within Brazil. I've been traveling there for over 2 years and those inter Brazil fares are out of sight. But I have to pay......no way around it. Supply is obviously way behind demand. And with teh worsl cup and then the Olympics...geeze...
 
Avianca
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:42 pm

its really a shame how expensive the fares are in SouthAmerica.... I will pay for next week LIM-MDE-LIM over 800 usd also their are plenty of different carriers that are offering the route direct or via 1 stop... shame shame shame
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oksman
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 10:58 pm

Quoting steve6666 (Reply 8):
Quoting notaxonrotax (Reply 6):
No significant competition in SA--> prizes will hit the roof before their planes will

Prices already have hit the roof, if you tried looking for some fares on LAN or TAM recently. I paid over US$1000 for a return from GRU to MAO last week, and the ponte aerea from Congonhas to Santos Dumont I regularly get quotes of over US$500 for ONE LEG on TAM.

This is why I still don´t understand CADE´s approval on this merger. I can´t see how it can be good for the consumer, in any aspect, specially the decision to stay in the same alliance. Just makes me wonder how lobbyst are powerfull in Brazil and how customers interests are left behind.
 
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IrishAyes
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:03 pm

Quoting notaxonrotax (Reply 6):
No significant competition in SA--> prizes will hit the roof before their planes will.

This doesn't make sense...when are planes supposed to hit the roof? In the hanger??

Quoting notaxonrotax (Reply 6):
I can't say I care for either airline too much; both livery and service wise; but there you go.

I think LAN has a gorgeous livery and they offer some of the best service of any airline I know. Not sure about TAM, but I have heard good things. To each his own.

Quoting hiflyer (Reply 7):
with AA in chapt 11 going to OneWorld right now is risky...AA needs to flood South America with aircraft to build revenue to support restructuring....gonna be interesting if they do go that way......

Bogus. Did Star Alliance fail when UA filed for bankruptcy? Did SkyTeam fold when DL filed? There is much more involved here than the financial situation of the airline. And believe me, AA bankrupt or not, LAN is better off maintaining its ties with OneWorld.

Also - the suggestion that AA needs to flood SA with capacity to generate revenue streams is neither practical nor relevant to this discussion. Again, AA's issue is COSTS. That is why they filed. That is where their focus needs to lie - on lowering them to be able to compete effectively. Their SA assets are very profitable and balanced as-is. The signs seem to indicate that LATAM is to stay in OneWorld and consequently it would be foolish of them to take the approach as you have suggested because it is an area of strength for them at present.

[Edited 2011-12-14 15:09:39]
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slvrblt
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:04 pm

Quoting hiflyer (Reply 7):
with AA in chapt 11 going to OneWorld right now is risky...AA needs to flood South America with aircraft to build revenue to support restructuring..
You can't be serious.  
Quoting notaxonrotax (Reply 6):
Interesting.
I can't say I care for either airline too much; both livery and service wise; but there you go.

Um.... I don't think people choose their carriers by the livery anymore.   
Service wise, TAM is OK. They can learn a lot from LAN, in that regard. Pax love LAN's service levels and they are better than AA in lots of areas; although - that should be addressed in the coming months.
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jfk777
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:15 pm

Holy mother of God, its going to happen. Every other airline group from Mexico to Argentina should be shivering in their boots. LATAM must have 50 widebody long haul planes, this makes it the biggest airline in the southern hemisphere, execpt for Qantas. Love to see those 77W in Lan colors.
 
notaxonrotax
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:50 pm

Quoting IrishAyes (Reply 19):
This doesn't make sense...when are planes supposed to hit the roof? In the hanger??

Sigh....it's combining a well known phrase with aviation; meaning, well......forget it, you really don't get it.

Quoting IrishAyes (Reply 19):
I think LAN has a gorgeous livery and they offer some of the best service of any airline I know.

I don't argue with you on the livery; it's pointless.

But, "the best you know"?
Again, it's moot to argue your personal experience cause I wasn't there but if LAN is the best in your experience; I can only wonder about which airlines you did NOT fly! Perhaps you could "spread your wings".....hang on, you don't have to spread your arms to fly on an airliner......it appears to make no sense.
There it is again, using aviation with a way of expressi....ah, well; it's pointless.

If you would try other airlines you may find that LAN is not exactly top-10 material.

Don't hold your breath for TAM either.

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Zkpilot
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:51 pm

Quoting jfk777 (Reply 21):
LATAM must have 50 widebody long haul planes, this makes it the biggest airline in the southern hemisphere, execpt for Qantas.

Not for long the way Alan Joyce is running Qantas International it will only have 18x A380 in 2023... thats it. No 744s, no 787, no A330 nothing. Jetstar is getting everything  
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MAH4546
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RE: LAN And TAM Merger Approved

Wed Dec 14, 2011 11:53 pm

A terrible, terrible day for Latin aviation. How authorities have so liberally allowed these market damaging cross-border ownership groups is beyond me.
a.
 
realsim
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 12:13 am

Quoting steve6666 (Reply 8):
Prices already have hit the roof, if you tried looking for some fares on LAN or TAM recently. I paid over US$1000 for a return from GRU to MAO last week, and the ponte aerea from Congonhas to Santos Dumont I regularly get quotes of over US$500 for ONE LEG on TAM.

And what does the merger between TAM and LAN have to with that? Right now they aren't merged, and LAN doesn't operate domestic legs in Brazil, so the problem is domestic competition in Brazil (and in a lot of other countries, of course).

LAN and TAM don't overlap in almost any route. Domestic and regional fares won't be affected. US-South America fares could raise because the competition between the LIM and GRU hubs will disappear, but there's still AV, CM and GOL. And regarding Europe, LAN only flies to MAD and FRA, so again the overlap is little. I've seen other merger or acquisitions much worse for costumers, like the DL/US slot swap, or the TATL JV that will reduce our choices to a maximum of 3 different airline groups in every single route, for example.

This should be seen as if LAN had created LAN Brazil, that's all. In Europe there's LH Germany, LH Austria, LH Switzerland and LH Belgium, and AF France, AF Netherlands and AF Italia. With the difference that LAN has created four of their 6 affiliates from zero, and only 2 have been "bought" (Colombia and Brazil).

That said, I would prefer if there was an airline group per country, of course, but I think this is not such a dramatic merger because low cost competition will come soon or after for sure in all these countries.

[Edited 2011-12-14 16:21:46]
 
commavia
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 12:32 am

Quoting hiflyer (Reply 7):
with AA in chapt 11 going to OneWorld right now is risky

Not at all.

Quoting hiflyer (Reply 7):
AA needs to flood South America with aircraft to build revenue to support restructuring

AA need not "flood South America" with capacity in order to build revenue. AA is already the dominant carrier in just about every market in South America (to/from the U.S.) it serves.

Quoting hiflyer (Reply 7):
gonna be interesting if they do go that way

Barring some dramatic unforeseen event happening in the near term, I think it's inevitable that LAN-TAM will end up in oneworld. LAN's already-deep - and deepening - relationships with oneworld members, particularly AA and Iberia, coupled with the regulatory restrictions, seems to lean heavily in oneworld's favor. Throw in the prospect - in a few years - of potentially getting AA and TAM an ATI/JV covering U.S.-Brazil, and you have quite an appealing opportunity for both LAN-TAM and oneworld.

Quoting mogandoCI (Reply 9):
If AviancaBrasil comes onboard and grows properly, then the net lost versus gaining Avianca-Taca is close to a wash.

It is way more than a "wash" - TAM and GOL control between them 85%+ of the domestic Brazil market, and the alliance that is left without one of them is going to be at a substantial competitive disadvantage for internal connections with Brazil. Star will make down with what will surely be a rapidly-growing Avianca Brasil, but that is - realistically - a very minuscule for airlines as massive as TAM or GOL.

Quoting mogandoCI (Reply 9):
Sad loss, but not the end of the world for Star Alliance.

  
 
jfk777
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 12:36 am

Quoting mah4546 (Reply 24):
A terrible, terrible day for Latin aviation. How authorities have so liberally allowed these market damaging cross-border ownership groups is beyond me.

How do " liberal" governments damage airlines ? If it was NOT for LAN, the airlines in Latin America would really be "Damaged" Look at Aerolinias Argentinas as the "perfect" example of a Latin airline who has been "protected". All over the world, both sides of teh Atlantic Ocean, airlines are merging with the neighboring countries airlines.
 
slvrblt
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 1:34 am

Quoting mah4546 (Reply 24):
A terrible, terrible day for Latin aviation. How authorities have so liberally allowed these market damaging cross-border ownership groups is beyond me.

Terrible? Why do you think so, mah4546..... Here's my counterpoint, because I feel it's made Latin America better, overall.
Honestly, the national airlines of many Latin American countries were too full of cronyism/corruption etc. to function properly. Many had safety as well as reliability issues. Aviateca of Guatemala went away; Ladeco- gone, Ecuatoriana -gone, LAB -gone, Viasa- gone, Avensa, ServiVensa...gone....Air Panama- gone...and so on. Varig hung on a long time but disappeared. Aerolineas Argentinas went away. Those last two came back, but it's not the same and they don't really hold a candle to the others.

I think that's how and why the cross-border ownerships took off so strongly. TACA saw an opportunity and took it. TACA became Grupo Taca. They really started this whole idea of cross-border type mini-groups of combined airlines.

The little national carriers couldn't survive once some of the route authorities began to relax - particularly after Eastern bought PanAm's south American route structure. EA , and AA afterwards, flying those routes gave frequencies, timeliness and stability to those flights. And that created the Latin American gateway and fortress that is now Miami. During that time TACA survived. So did Avianca. And now Avianca lives on inside TACA as does LACSA and Aviateca and some pieces of the others. It's almost like their version of deregulation the US went thru, albeit with fewer and smaller carriers.
LAN was still just LanChile back then. Seems to me that LAN took a good idea from Grupo Taca and did it better.
..everything works out in the end.
 
2travel2know2
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 1:43 am

Quoting Zkpilot (Reply 5):
Are there any airlines left in South America? LAN seems to have gobbled up the whole continent! AR is in pretty bad shape.

Other than AR, there's Argentina's Andes; Uruguay's PU; Bolivia's Aerosur; Chile's Sky Airline; Venezuela's Venzolana, Conviasa and SBA; Ecuador's TAME; Colombia's SATENA and Suriname's PY. Plus Panama's CM might be considered south american by some.

Quoting jfk777 (Reply 29):
How do " liberal" governments damage airlines ? If it was NOT for LAN, the airlines in Latin America would really be "Damaged" Look at Aerolinias Argentinas as the "perfect" example of a Latin airline who has been "protected". All over the world, both sides of teh Atlantic Ocean, airlines are merging with the neighboring countries airlines.

So LA forced TA to merge with AV? How did LA keep CM from being "damaged"?

Airlines are getting to be multinational globalised companies, or to a lesser extend more dependent on alliances, very few would survive on its own, that's the scenario we're heading for.
As for South America goes: LA/JJ will end up in One World, AV/TA and probably G3 in Skyteam, CM will remain in Star Alliance. Star will have to do something drastic not lo further lose its presence in South America.
I'm not on CM's payroll.
 
chopchop767
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:17 am

Quoting miner (Reply 10):
I can't seem to see the issue here. Some of SA)">AA's most profitable routes are in South America. SA)">AA's SA)">CH.11 is a reboot, not a death sentence. This is the best time to consolidate that market and by getting a partner like TAM in Brazil to feed traffic to SA)">AA aside from their SA)">OW partner LAN, is an excellent thing.

If anything, the fact that SA)">AA has so many flights to SA makes them more competitive should LANTAM align with STAR. On the other hand, UA doesn't have so many and therefore would have to attempt to add frequencies, should them become available, should LANTAM go with OneWorld. UA/Star have more to lose here.
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PPVRA
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:18 am

Travelling between South America will become very easy, finally. Greater economic integration of the region will result.

A fantastic development.
"If goods do not cross borders, soldiers will" - Frederic Bastiat
 
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Zkpilot
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:53 am

Quoting 2travel2know2 (Reply 31):
Quoting Zkpilot (Reply 5):
Are there any airlines left in South America? LAN seems to have gobbled up the whole continent! AR is in pretty bad shape.

Other than AR, there's Argentina's Andes; Uruguay's PU; Bolivia's Aerosur; Chile's Sky Airline; Venezuela's Venzolana, Conviasa and SBA; Ecuador's TAME; Colombia's SATENA and Suriname's PY. Plus Panama's CM might be considered south american by some.

How many of them fly to UK/EU, USA/Canada, or Africa? None of them fly to NZ or Australia, and I doubt any fly to Asia.
Fair enough I'm not overly familiar with Central America/South America, but I think I may have possssssibly heard of SATENA... the rest are but bit players no?
56 types. 38 countries. 24 airlines.
 
kiwiandrew

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:32 am

Quoting mah4546 (Reply 24):
A terrible, terrible day for Latin aviation. How authorities have so liberally allowed these market damaging cross-border ownership groups is beyond me.

Wow, I never thought I would say this, but I owe you an apology Mark. I assumed that you would be all gung ho in favour of this. I guess that should teach me not to make assumptions about what other people are going to think on a particular topic but wait until they post on it instead.

Having said that, I don't see anything wrong with cross border mergers per se, IAG for example had, IMHO, minimal impact as it involved airlines with strengths in totally different parts of the world. However, I think in this case the consumer would have been much better served by keeping these entities as separate airlines in separate alliances.
 
VC10er
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:48 am

Quoting mogandoCI (Reply 9):

Yes, I have flown TAP many times to and from Brazil and their were decent connections throughout Europe. The big hole is LHR. I really loved the TAM 777-300. And the other good thing about TAP is the non-stop from GIG then onto Geneva etc.

Will Avianca invest in widebody aircraft to fill the void? And mostly...UA EWR to GIG becomes even more critical.


One bright side is the horrible TAM logo taken off the airport Star Alliance signage  
The world is missing love, let's use our flights to spread it!
 
2travel2know2
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 5:19 am

Quoting Zkpilot (Reply 32):
How many of them fly to UK/EU, USA/Canada, or Africa? None of them fly to NZ or Australia, and I doubt any fly to Asia.

Aerosur from Bolivia to MAD. PY from PBM to AMS. Venezuelan Conviasa and SBA fly to Europe Conviasa flies to IRAN. Of the airlines mentioned earlier 4 fly to the US, one to Canada.

Quoting Zkpilot (Reply 32):
the rest are but bit players no?

Yeah, CM a bit player...

And if JJ leaves Star Alliance, what Star Alliance airlines may do, not that it may be profitable, would be to operate tag-on from GIG/GRU to EZE/SCL and between SCL and EZE. That way at least Star Alliance would offer flights of its own between those major South American markets.
I'm not on CM's payroll.
 
kiwiandrew

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 5:26 am

Quoting 2travel2know2 (Reply 35):
And if JJ leaves Star Alliance, what Star Alliance airlines may do, not that it may be profitable, would be to operate tag-on from GIG/GRU to EZE/SCL and between SCL and EZE. That way at least Star Alliance would offer flights of its own between those major South American markets.

I think what we are likely to see is an accelerated push to include Avianca Brazil in *A ( They are currently not part of the planned TA/AV move to *A) . I suspect that they will also make a play for some of the GRU-SCL capacity which has to be surrendered.

As for EZE-SCL, doesn't AC already operate that as a tag? Although to be honest, I am not sure that it is a market worth pursuing since AEP was opened up to regional flights.
 
PezySPU
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:03 pm

Quoting mah4546 (Reply 24):
A terrible, terrible day for Latin aviation. How authorities have so liberally allowed these market damaging cross-border ownership groups is beyond me.

While it might prove to be damaging in the future, isn't it better to (potentially) damage your market just a little with your own airline rather than leave it to foreign airlines which can (and probably would) totally destroy it? South America simply needs an airline like LATAM to be able to compete with powerful foreign airlines.
 
Gonzalo
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:06 pm

Quoting notaxonrotax (Reply 22):
Again, it's moot to argue your personal experience cause I wasn't there but if LAN is the best in your experience; I can only wonder about which airlines you did NOT fly!

Your comment is unfair to say the least. LAN, my friend, IS one of the best airlines. They have a superior product in Service, fleet age, IFE, cabin lay out, website, network, codeshares, safety, crews professionalism... But I guess it's moot to argue your personal attitude against the airline because you seem to have a personal issue with LA.
Is like ELVIS.... millions of fans can't be wrong... but from time to time emerges one here or there saying Elvis is crap.



Quoting realsim (Reply 25):
And what does the merger between TAM and LAN have to with that? Right now they aren't merged, and LAN doesn't operate domestic legs in Brazil, so the problem is domestic competition in Brazil (and in a lot of other countries, of course).

LAN and TAM don't overlap in almost any route. Domestic and regional fares won't be affected. US-South America fares could raise because the competition between the LIM and GRU hubs will disappear, but there's still AV, CM and GOL. And regarding Europe, LAN only flies to MAD and FRA, so again the overlap is little. I've seen other merger or acquisitions much worse for costumers, like the DL/US slot swap, or the TATL JV that will reduce our choices to a maximum of 3 different airline groups in every single route, for example.

This should be seen as if LAN had created LAN Brazil, that's all. In Europe there's LH Germany, LH Austria, LH Switzerland and LH Belgium, and AF France, AF Netherlands and AF Italia. With the difference that LAN has created four of their 6 affiliates from zero, and only 2 have been "bought" (Colombia and Brazil).

That said, I would prefer if there was an airline group per country, of course, but I think this is not such a dramatic merger because low cost competition will come soon or after for sure in all these countries.

Well said !!!
     
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steex
Posts: 1319
Joined: Wed Jun 27, 2007 8:45 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 2:19 pm

Quoting jfk777 (Reply 27):
How do " liberal" governments damage airlines ?

I don't believe mah4546 was using the term liberal in a political sense at all, but rather in reference to the vast freedom that has been given to the airlines to combine however they'd like regardless of potential impacts to the market.
 
eastern023
Posts: 631
Joined: Wed Jul 19, 2006 2:54 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:07 pm

Quoting chopchop767 (Reply 30):
If anything, the fact that SA)">AA has so many flights to SA makes them more competitive should LANTAM align with STAR. On the other hand, UA doesn't have so many and therefore would have to attempt to add frequencies, should them become available, should LANTAM go with OneWorld. UA/Star have more to lose here.

Not following. Can you kindly elaborate more?

Quoting 2travel2know2 (Reply 35):
Conviasa flies to IRAN

Did they drop Damasco? Well there's two politically staetment flights, flights fly empty and not to any major hub...I wouldn't even consider them real commercial flights...

Quoting Gonzalo (Reply 38):
Quoting notaxonrotax (Reply 22):
Again, it's moot to argue your personal experience cause I wasn't there but if LAN is the best in your experience; I can only wonder about which airlines you did NOT fly!

Your comment is unfair to say the least. LAN, my friend, IS one of the best airlines. They have a superior product in Service, fleet age, IFE, cabin lay out, website, network, codeshares, safety, crews professionalism... But I guess it's moot to argue your personal attitude against the airline because you seem to have a personal issue with LA.

LAN is pretty good. Not the best in the world sure, but LAN really shines next to other south americans such as AR and PU, etc. CM and AV are great, but LAN is bigger and flies better equipment. LAN especially comes ahead when compares the hard Y product to other North Americans and Europeans such as DL, UA and epecially AA & IB.
AA will Rise Again!
 
superjeff
Posts: 667
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:08 pm

Quoting slvrblt (Reply 28):

Actually, Eastern acquired their South American routes from Braniff. United got Pan Am's Latin American routes when Pan Am failed.. And the old Braniff operations included the former Panagra, which Braniff acquired in 1967. They had a hub in LIM, and their South American operations were pretty much autonomous, run by locals. AA's Latin American operations still include remnants of the old Braniff operations.
 
Acheron
Posts: 1825
Joined: Mon Sep 05, 2005 1:14 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:49 pm

Quoting Zkpilot (Reply 5):
Are there any airlines left in South America? LAN seems to have gobbled up the whole continent!

They have been on the road to trying to stablish a monopoly on south america for a while now, and the governments are letting them do so, apparently.

Kind of like Iberia in the mid 90's when they bought several airlines, stripped them of any identity and then tried to dismantle them.
 
LH506
Posts: 246
Joined: Sun May 06, 2007 9:48 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 3:58 pm

Quoting 2travel2know2 (Reply 29):
As for South America goes: LA/JJ will end up in One World, AV/TA and probably G3 in Skyteam, CM will remain in Star Alliance. Star will have to do something drastic not lo further lose its presence in South America.

I am sure AV-TA will stay with *A and not Sky. Especially now, where it is very obvious that Latam will go for 1W. In addition AV-Brasil will join very soon *A and will try to get as many frquencies as possible at GRU to serve the void JJ left for *A. Especially will they start GRU-SCL. DL played it smart to assure that G3 will stay with Sky, so *A has to build up AV-Brazil.
NOT FLOWN: 707 717 736/9 764 77L 788 300B2 300B4 345 359 RJ70/146-100 F27 ATR72 CRJ1/4/10 E120/135/40 Q1/2/3 M87
 
notaxonrotax
Posts: 964
Joined: Wed Mar 16, 2011 2:29 pm

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 4:05 pm

Quoting Gonzalo (Reply 38):
Your comment is unfair to say the least. LAN, my friend, IS one of the best airlines. They have a superior product in Service, fleet age, IFE, cabin lay out, website, network, codeshares, safety, crews professionalism... But I guess it's moot to argue your personal attitude against the airline because you seem to have a personal issue with LA.
Is like ELVIS.... millions of fans can't be wrong... but from time to time emerges one here or there saying Elvis is crap.

No personal "issue" whatsoever, it is called choice.
For my routes I normally have a choice between TACA, COPA & LAN.
Between TACA and LAN mainly, to be frank.
I find TACA:

Cheaper (generally).
More on time (otro vuelo operado a tiempo por TACA!)
More pleasant with regards to on board service.
More flexible with changing dates etc.
More professional in their local offices.
Simply more convenient.

The above are items that I, and a few around me; have noticed over the last few years.
How would I not prefer TACA over LAN on those particular routes?
You have obviously different experiences, I just state mine.

LAN is allright, but to call it one of the best airlines in the world is a bit of a stretch, Gonzalo my man.
Do you really think it can compete with a few names from the Far East for instance?? Middle East?? Europe??
Locally they have won a prize or what.......but globally??

Calling LAN "Elvis" is stretching it beyond its flexibility!
Let´s not get over-patriotic here!
Steady now.........

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[Edited 2011-12-15 08:20:20]
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PDPsol
Posts: 1109
Joined: Fri Feb 20, 2004 5:09 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 5:01 pm

In reality, the acquisition of AM-Transportes Aereos Meridionais (Brazil)">JJ by LA is simply a reflection of broader, global commercial forces, yielding higher operational efficiency, market influence and superior returns to shareholders and other investors. Commercial value maximization and operational efficiency are not limited to national borders.

Commercial aviation in Latin America is developing along global alliances, with LATAM, LA and AM-Transportes Aereos Meridionais (Brazil)">JJ most likely joining oneWorld, AV, TA and CM [and their affiliates] joining Star Alliance, and AM, AR and, perhaps even G3, joining Sky Team. These are all large, well-managed carriers [with the glaring exception of AR of course], with pan-regional coverage, and big fleets.

Nonetheless, there a few, private independent carriers that have grown very quickly and should not be ignored. PU comes to mind, with a fast-growing network and fleet of CRJ 900NG aircraft operating throughout the southern cone region. Canada's Chorus Aviation Inc., owner of Jazz, is a 15% equity holder in PU and has a strategic interest in the region. PU announced yesterday it realized favorable operating income for the first time since 1999 and plans to transport 1.5 million passengers in 2012, not bad for a tiny carrier in a small nation hoping to develop its commercial aviation sector by bridging Brasil with markets in Argentina and beyond. Sky Airlines of Chile also looks promising. AV recently announced a code share agreement with them.

Crazy fares, like the USD 500 one-way GRU-MAO example a fellow poster listed earlier, are unsustainable in a free market. For every LATAM combination, policy makers and regulators know a competitor will pop up, out-price AM-Transportes Aereos Meridionais (Brazil)">JJ and G3, and steal market share. Brasil is a massive, growing market and there is no reason why Azul or O6 or someone else cannot compete with them.

Of course, the big question revolves around Brasil's serious infrastructure shortfalls. What is the point of offering capacity from GRU if the carrier has no slots to operate from? Brasil is, apparently, fully aware of this but must work harder if it is to fully develop its commercial aviation sector.
 
PPVRA
Posts: 7864
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RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 6:35 pm

This integration should also further erode the curse of nationalism that is still strong in Brazil and I would imagine in other places in Latin America too. In time, new entrants from other markets would only increase competition. The GRU-SCL route is the prefect example: both Chile's and Brazilian antitrust authorities have imposed limitations on this route for LATAM, but they would probably never have been necessary if foreign airlines were allowed to sell tickets between Brazil and Chile.

In the end, protectionism is a much bigger danger than anything LATAM can do. This protectionism protects TAM's bottom line, not the passenger.
"If goods do not cross borders, soldiers will" - Frederic Bastiat
 
PDPsol
Posts: 1109
Joined: Fri Feb 20, 2004 5:09 am

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 6:44 pm

Quoting PPVRA (Reply 46):
In the end, protectionism is a much bigger danger than anything LATAM can do. This protectionism protects TAM's bottom line, not the passenger.

Totally agree with your assessment here. Regional integration of the commercial aviation sector cannot occur with protectionist policies. With the obvious and notable exception of markets like Argentina and Venezuela, the sector is achieving greater integration and is enhancing its development.

The most important market is Brasil, Brasil, Brasil. Policymakers and regulators have chosen competition over protectionism, and have plans to further open the sector in the future.

BTW, my equity ownership number is post #45 is incorrect. Chorus Aviation Inc. actually owns 25% of PU, not 15%. They acquired the interest directly from Leadgate, a private investment fund, that had owned 75% of PU and now owns 50% of the carrier after selling the 25% interest to the Canadians for USD 15 million in 2010.
 
2travel2know2
Posts: 2299
Joined: Mon Apr 26, 2010 3:01 pm

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 6:52 pm

Quoting notaxonrotax (Reply 44):
For my routes I normally have a choice between TACA, COPA & LAN.
Between TACA and LAN mainly, to be frank.

For example, for travel between LIM and Brazil (except MAO), Argentina, Uruguay, Ecuador, Bolivia, Chile,.. CM isn't good, unless that's the only way to redeem frequent flyer awards.

Quoting PDPsol (Reply 45):
Of course, the big question revolves around Brasil's serious infrastructure shortfalls. What is the point of offering capacity from GRU if the carrier has no slots to operate from?

It's not that there are no slots to operate from, @ GRU there are still slots to operate from, just that those slots aren't the ones the airlines want.
What should worry some is that VCP, while not a good relief airport for GRU, may face restrictions soon. It seems U.S. airlines now have access restricted to that airport too, as is the case w/GRU.
I'm not on CM's payroll.
 
notaxonrotax
Posts: 964
Joined: Wed Mar 16, 2011 2:29 pm

RE: LAN And TAM Merger Approved

Thu Dec 15, 2011 7:17 pm

Quoting 2travel2know2 (Reply 48):
For example, for travel between LIM and Brazil (except MAO), Argentina, Uruguay, Ecuador, Bolivia, Chile,.. CM isn't good, unless that's the only way to redeem frequent flyer awards.

Definitely.
I Love COPA for central America.
Panama must be one of the most convenient places to do a swift plane change.

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