On July 2nd, the Macri administration announced the elimination of a minimum price floor for plane tickets within the country. Yesterday, the measure went into effect after being officially added to the Boletín Oficial as Resolution 656/2018. The change had been originally slated for August 15th, but was moved up in a last-minute decision, much to the joy of low-cost airlines looking to enter the market. With the law now in place, both low-cost and traditional airlines have announced new fares—some as low as AR $199 for domestic flights.
Now, a new development: between October and November of this year, three new low cost airlines will begin flying in Argentina. These are the Chilean Jetsmart, Norwegian, and the Argentine Lasa, which will expand its routes in the Argentine Patagonia.
According to updates from the National Civil Aviation Administration (ANAC), the Norwegian airline—which operates as Norwegian Air Argentina within the country—as well as Lasa, will begin operating their commercial flights in October. Jetsmart, meanwjile, will begin its operations in November.
Chile’s Jetsmart will cover 21 routes to 36 domestic destinations in Argentina, as well as 13 international flights, which will be obtained in the company’s planned acquisition of the airline Alas del Sur. After this merger, Jetsmart expects to add a number of flights between Santiago de Chile and Argentine low cost airport El Palomar.
For its part, the airline Lasa will concentrate on offering flights to and from the Patagonia region, both within Chile and Argentina. Some projected routes for the company include Bariloche-Puerto Montt (from AR $994), Neuquén-Temuco (from AR $1,332), Chapelco-Bariloche (from AR $520) and Bahia Blanca-Neuquén (from ARG $1,207). Two of Lasa’s planes have already been brought to Argentina in preparation.
Norwegian, meanwhile, is the third largest low cost airline in Europe. As an international airline with headquarters in Oslo, the company already operates a flight between London and Buenos Aires four times a week. However, the airline hopes to increase these flights to at least once a day starting in December. At the same time, once it officially begins operating within Argentina, Norweigan expects to have access to 72 domestic and 80 international flight routes.
Today, the company confirmed that its ticket sales would begin at the end of August, while flights would start in mid-October. “We will start off with domestic flights, setting as our destinations those that have been traditionally most popular among tourists,” Matías Maciel, the director of Communications for Norwegian Air Argentina, stated. “Then, as new aircrafts arrive, we will add more routes, with regional flights starting next year”.
“30 percent of the flights in the world are run by low-cost airlines. These broaden the commercial airline market, because people who have never flown before can now do so for the first time,” stated Tomás Insausti, head of ANAC.
Insausti emphasized that there are many people looking to buy airline tickets who prioritize low prices, while others, like business travelers, are fine with traditional airlines.
“All of these policies focused around lowering rates are another crucial element in achieving the goal of getting more and more people to fly around Argentina. In just the first hours of these flat rates there were record sales.”
According to statistics released by ANAC records, there were 100 registered airplanes within the Argentine market. Today, there are 130—a thirty percent increase in the past three years. By 2019, it is estimated that these numbers will rise to 150, thanks to the addition of the new airline companies planning to enter the local market.
“Argentina has an average of 26 air passengers per 100 inhabitants. But in other markets in the countries such as Chile, Colombia or Brazil, the figure is more than 46 per 100,” Insausti emphasized. “Those countries, years ago, took the same measures that we have just completed. Brazil started 15 years ago, and went from having 33 million passengers to 115 million.”