JetSmart takes flight from Chile; initial network shows 11 routes and eight destinations; LATAM Airlines already serving 73% of network
JetSmart is a new Chilean ULCC based in Santiago. It was created by Indigo Partners, which now controls Denver-based Frontier Airlines as well parts of Wizz Air (planning to sell its 18.7% stake) and Volaris. The airline took flight on its inaugural revenue service on 25 July in the form of a 1,225-kilometre route to Calama in northern Chile. Currently the airline is operating the city pairing five times weekly according to its booking engine, with the route already being flown by LATAM Airlines 72 times weekly and Sky Airline 33 times weekly respectively. JetSmart will operate a fleet of A320s of which it currently has two, with a third expected shortly. Overall the airline is initially planning to operate 11 domestic routes from eight airports by the end of northern summer 2017.
Competition on eight routes but LATAM is preparing to fight
LATAM Airlines and SKY Airlines are the leading carriers when it comes to direct competition for JetSmart, with both already serving eight of the planned routes on the ULCC’s future network. Below is a table showing the start dates of JetSmart’s routes and the competition it will face at the time of launch. JetSmart has stated that it will increase the frequency on some of its services once it gets more capacity. However, when referring to the carrier’s booking engine these additional flights have not yet been added.
|25-Jul||Santiago (SCL)||Calama (CJC)||A320 (5)||LATAM Airlines (72), Sky Airline (33)|
|31-Jul||Antofagasta (ANF)||A320 (6)||LATAM Airlines (79), Sky Airline (26)|
|07-Aug||La Serena (LSC)||A320 (4)||LATAM Airlines (29), Sky Airline (13)|
|14-Aug||Calama (CJC)||Concepcion (CCP)||A320 (3)|
|Santiago (SCL)||A320 (6)||LATAM Airlines (48), Sky Airline (22), Latin American Wings (11)|
|15-Aug||Concepcion (CCP)||Antofagasta (ANF)||A320 (3)|
|21-Aug||Santiago (SCL)||Copiapo (CPO)||A320 (4)||LATAM Airlines (20), Sky Airline (13)|
|14-Sep||Puerto Montt (PMC)||A320 (4)||LATAM Airlines (50), Sky Airline (28), Latin American Wings (9)|
|25-Sep||Temuco (ZCO)||A320 (5)||LATAM Airlines (30), Sky Airline (17)|
|28-Sep||Antofagasta (ANF)||La Serena (LSC)||A320 (3)||Sky Airline (6), LATAM Airlines (2)|
|02-Oct||Concepcion (CCP)||Puerto Montt (PMC)||A320 (5)|
|Source: JetSmart booking engine and OAG Schedules Analyser data.|
It should be noted that from October LATAM will also link Conception and Antofagasta with three weekly flights, the same frequency that JetSmart will operate the service from as of 15 August. Currently with JetSmart’s planned network, LATAM is operating on 73% of all routes, but when it introduces flights between Conception and Antofagasta in October LATAM will cover 82% of the ULCC’s network.
Time for market shake-up
So how is the domestic market in Chile developing? Well currently LATAM and Sky Airline are the only carriers offering regular scheduled domestic services in Chile, with both combined offering 12.6 million seats last year on intra-Chilean routes. This is up by 3.1% when compared to the 12.2 million seats both offered in 2015. However, while growth was seen last year, 2016’s annual seat capacity is still 4.4% below the 13.2 million seats that were offered in 2013, the last year that PAL Airlines operated a full 12-month schedule before ceasing operation the following year. It had been in the market since 2009, having operated charter services before then.
Since the demise of PAL Airlines, it has meant that the Chilean domestic market has been served by just two carriers – LATAM (72% of the domestic market) and Sky Airline (28%). For 2017 LATAM is indicating that its seat capacity in the Chile domestic market will grow 9.5% to 9.94 million seats, while Sky Airline will see its seat offering increase by close to 12%, with it showing that it will operate a total of 3.94 million seats in 2017. This means that these two airlines combined will increase their seat offering by 10% this year to just under 13.9 million seats, which is a record-breaking year in regards to seat capacity in the domestic market. With this growth, it seems like a good time for another entrant to join the market. With JetSmart having not loaded its data into OAG, it is currently hard to calculate what its market share will be in 2017.
JetSmart is not the only new entrant this year
While JetSmart is a new entrant for 2017, so is Latin American Wings, a carrier which currently operates the following routes: Santiago-Concepcion; Santiago-Puerto Montt; and Concepcion-Puerto Montt. These route are also destined to be served by JetSmart. It should be noted that the latter route is currently not bookable past 31 August. Along with Latin American Wings, the airline Aerovías DAP also operates some scheduled charter services in Chile.