LAN now charging all NON-RESIDENTS a $178.50 fee

[cajun jamie]

The way it was in the past, the way I have done it and the way thousands of others have done it was simple.

LAN used to allow anyone to purchase a ticket, at the Peruvian price, as long as you paid for the ticket in Peru, or had an agent in Peru purchase the ticket for you.

There are hundreds of posts on this and many other forums, explaining how LAN posts two different prices, and anyone can purchase the Peru price, if they pay for the ticket in Peru, or have the agent do it.

What changed was one day, LAN decided they were losing a lot of money by allowing just anyone to get the Peruvian price. So, instead of buckling down on the agents, or making sure LAN offices only sold tickets to bona-fide residents, they penalized the ticket holder.

This is what rubbed people wrong. People bought tickets, using agents and LAN in Peru, then showed up at the airport and LAN surprised them.

NOPE! You should not have been allowed this ticket, so pay or you don't fly. This is NOT the way to do business. The way to do business is to prevent the SALE of tickets to people who do not qualify.

But, instead of cracking down on agents (even their own), they punished the passengers, who often times, knew no better.

That is the crux of the matter. If someone is allowed to purchase a ticket, LAN should honor that ticket. Plain and simple.

[iron butterfly]

Has anyone been able to catch that slippery running foreign media running with this story?

[Just a thought . . .]

If someone is allowed to purchase a ticket, LAN should honor that ticket. Plain and simple.

I couldn't agree more!!

[rickfrombrooklyn]

Let me start with some personal disclosure: I earn most of my daily bread from the travel business.

LAN claims that this fare hike represents its "commitment to the country's development" and that it "is working very hard to promote air transportation inside Peru, (and) therefore (is) pushing internal commerce and tourism."

"In this sense, we have created a campaign directed especially to the public, which despite currently residing in Peru has not yet had the opportunity to be acquainted with the diverse and attractive destinations that are offered by the distinct cities of our country. For this campaign we have coined the name 'Peru is yours, Know it,' and will be disseminated it via a major publicity campaign, inviting Peru's residing public to get to know Peru's distinct cities, using our promotional fares ... which will apply only to resident of Peru."

That sounds very magnanimous. But it's B.S.

This campaign, in fact, represents the height of cynicism on the part of LAN.

Take note: this airline is not offering lower fares for Peruvians and residents of Peru, so much as it is barring foreign tourists from purchasing coach tickets at the normal base fares (Clases Tarifarias O,Q,N and S).

A middle-income Peruvian who couldn't afford the $130-$160 cost of a round trip ticket to and from Cusco isn't suddenly going to be able to afford that ticket.

But now instead of a Lima-Cusco-Lima round trip fare costing a foreign visitor $160, it will cost upwards of $240... and more than $400 if he/she buys directly through LAN's USA or European web portals.

Price gouging visiting tourists does not promote air transportation inside Peru, nor does it create an incentive for commerce and tourism. It has just the opposite effect, making Peru distinctly unaffordable and drastically dissuading foreign tourists from considering Peru before other destinations.

What does that mean for tourism in Cusco, where the global economic crisis has meant a 30-40% drop in tour groups this year?

It is an outrage that one airline maintains a monopoly on 90% of the domestic routes and can get away with such a flagrant act of price fixing.

[cajun jamie]

Thank you. Exactly.

[mammalu]

Bad very bad for tourism. But it was something that was going to happen eventually.

You just mentioned, the tickets to Macchu Picchu and tourists not allowed on certain trains. The promotional rates in Lima hotels (valid only for residents or nationals). When will it hit restaurants or shopping?


P.S. Summer is over... I am back!

[american_in_lima]

It is an outrage that one airline maintains a monopoly on 90% of the domestic routes and can get away with such a flagrant act of price fixing.

This reminds me of Telefonica and their complete monopoly until Telmex/Claro got a chance to play in the game.

It's hard to dictate a dictator.Not impossible, but difficult.

[gerard]

CJ's and Rick's posts have helped me understand this a lot better, but at the risk of sounding like a LAN guy let's see if we can come up with a business model for what they're doing. I'm giving them some credit here for actually thinking about this campaign and not just waking up one day and saying let's gouge the gringos.

LAN have almost a monopoly in the internal market. That may require them to fill their landing slots - if they don't there'll be pressure from other airlines to open up some of those routes to competition. But passenger numbers are down 30-40% and your local passengers can't afford an across the board price hike. So you look at your passenger mix and see who you can get more money out of. The easiest way to do this is to restrict your cheapest tickets to your local passengers and call it a promo. You get the same revenue even though your flights are 40% emptier as the tourists are paying 40% more. I don't get the impression that the recession has hit that hard here, so local passengers numbers may not have changed too much.

So my guess would be that the promo will run until the economy picks up and passenger numbers increase again. At that point LAN will need to drop prices again to stay competitive or the other airlines will be able to point at half empty LAN flights while they're flying full and demand more access to routes. In that sense the market will self-regulate.

[guest145]

yes, sadly it's the consumer that suffers when lan/any other monopoly cashes in on its dominant position. As you say american-in-lima, the market should work this out - but obviously that's going to take a while to say the least - especially given the barriers to entry into the airline business (whilst star peru planes look pretty on the outside would you rather fly with an airline with planes that are on average just under 4 years old (lan) or one with 23 year old planes? (star)*..i'd rather pay the extra). * according to airfleet.net

the issue of negligent or dishonest misselling seems pretty clear - so it seems v bad pr at the very least that those affected have not been re-imbursed.

on the general issue of better rates for residents/nationals - i appreciate that this is profitable business but could this not also
be race discrimination? ( the practice adversly affects the majority of non-residents on grounds of race) - i think cusco previously raised this issue of discrimination. i guess this might depend on whether:-

a) promoting tourism within peru for peruvians is a legitimate aim which could legally justify otherwise discriminatory action (eg the dual rates) - (no idea really, although my initial thought is that it could be);

b) if so, whether the action taken in each case (train, lan, hotels) is a proportionate means of obtaining the legitimate aim - re lan, as you say rickfrombrooklyn, since the costs of flights have not come down for peruvian nationals/residents this doesn't look promoting domestic tourism

obviously, appreciate that I could be quite/way off the mark on all this!! ..and even if I'm not, this is probably largely theoretical anyway (given the state of the peruvian legal system ).

One fact I'd be interested to find if anyone has it to hand - does Lan have dual fares in other countries it operates in or is this just Peru?...

just my 2 centimos worth and sorry to add more words to this already long post. i know people must be tired!

[gerard]

The answer to that last question would appear to be yes. A quick look at Santiago-Concepcion on Lan Chile gives 3 rates varying between $55 and $100. Same flights, same dates on LAN USA gives 2 prices between £190 and $210. Base rate is not an option.

[LauraMH]

Just to add, I don't know if anyone else has seen the commericals but their travel campaign is now on TV. We just saw a commerical about promotional fares for Peruvians in Peru.

The sad thing is.....it's not promotional. The fares have always been there at that price. It's a low price, but not a new price. What is new is their advertising campaign.

You're right. If you couldn't fly before, you can't fly now. Maybe they'll get a few new people but in general. I don't see all the effort amounting to much for them.

[american_in_lima]

Has anyone on this forum actually paid the $180 gringo tax yet?

George

[iskndarbey]

If you book the way you're supposed to, round trip tickets generally come out ~$50 more expensive than the base option. So it's not a $180 gringo tax, it's a $50 gringo tax and a $130 stupidity tax.

[jude]

Depends where you're flying. Lima to Cusco round trip is more like $100 more expensive. If you take LAN's nice suggestion to book using the US or European version of their site then it's more like $300 more expensive.

[tupacperu]

This is where your money is going with LAN:

LAN expects another profitable year
Air Transport World Thu, 10 Sep 2009 21:17 PM PDT
LAN Airlines is feeling the effects of the industry crisis but said it expects to report a profit this year thanks to its domestic strength in Chile, Argentina, Peru and Ecuador and a robust cash position


http://www.atwonline.com/news/story.html?storyID=17831

[tupacperu]

Spirit Airline is not looking at all bad to me.

Bad service, but a cheap flight that last 5.5 hours (FT Lauderdale)

[Kelly]

It's bad now, for a company to make a profit?

[JimOnTheBeach]

My wife has used Spirit from Ft Lauderdale on her last 2 trips to Lima. Not only is the price good, it is much easier to go out of Ft Lauderdale than Miami.

[tupacperu]

Profit is not bad, it depends if you make a profit shaking people down (BAD-BAD).

Read the article "profited mostly from domestic business ( national flights ). This is a part of the $178.00 fee (which is probably implemented in each country where LAN is based)

T

It's bad now, for a company to make a profit?

[american_in_lima]

Spirit Airline is not looking at all bad to me.

Bad service, but a cheap flight that last 5.5 hours (FT Lauderdale)

Tupac - They only flyt out of Lima on Saturdays now if I remember correctly.

I have flown them more than 15 times. For a 6 hour night flight where you can sleep, I don't mind paying $150 to $200 less on a ticket. Leaving Fort Lauderdale to Lima, they have a one bag limit (maybe they changed it) which to me is a negative. Customer service is not their middle name. Comes down to the customer determining what is more important: price or value.

George

[cajun jamie]

Please re-direct all future Spirit posts to the thread about Spirit, to avoid deletion.

This is a discussion about LAN and the foreigner fee.

[tupacperu]

I flew LAN many times in the past (over 5 years), it was costly and overrated. The taxes/fees to book a flight out of Peru are bad. If you buy a ticket rt from the USA the taxes/fees are not that bad, but from Peru rt it cost almost the one way price. Have to look at the fine print on LAN.
I do mind the cost, I can spend $200.00 on enjoying dinners out in Lima for that price.


Sorry -You got bad info on that (Spirit/Saturday). It was posted on this forum and not verified. Nothing in the press releases on this.

Really do not know how people are allow to spread stuff like that. I figured one of the Mods would catch. But as many do not like Spirit, they may have let it ride. Seen law suits about this, a company EMULEX (mid 90s) where something was falsely posted about an event and the price of the stock went way down.
People started dumping stock.

Spirit Airline is not looking at all bad to me.

Bad service, but a cheap flight that last 5.5 hours (FT Lauderdale)

Tupac - They only flyt out of Lima on Saturdays now if I remember correctly.

I have flown them more than 15 times. For a 6 hour night flight where you can sleep, I don't mind paying $150 to $200 less on a ticket. Leaving Fort Lauderdale to Lima, they have a one bag limit (maybe they changed it) which to me is a negative. Customer service is not their middle name. Comes down to the customer determining what is more important: price or value.

George

[Kelly]

Before you accuse people of not checking facts or of some sort of anti-Spirit bias, perhaps it would do you well to check your facts.


From the Spirit Air website: Service to Lima, Peru operates on Saturdays only between September 1, 2009 and April 30, 2010.

Now, as CJ said, let try to keep this thread on topic, shall we? We have plenty of other threads for discussing Spirit.

[tupacperu]

Have to admit. I was wrong. Called Spirit and this was not a general annoucement. Spirit cut back service between Sept1 and April 1 to only SUnday's. Quite surprised. Apologies to the MODS .

[cajun jamie]

I am going to purchase my tickets next week for Machu Picchu. I will report on what plays out.

[americorps]

Are you going to purchase the peruvian priced ticket?

[cajun jamie]

yup!

[Claudia1973]

We purchased a ticket on LAN.com today. The cupon de pago states that foreigners will be charged $178.50 extra.

This foreign fee is mentioned at the end of the online reservation process.

LAN ought to list the fee with the ticket price. For example, at the quotation stage use a foreign check box to toggle the $178.50 fee in the quote.

Final note: $178.59 per foreign fee is about 135% of the cost of the flight.

[cajun jamie]

Who else flies to Cusco from Lima besides LAN? I don't care how much. I am taking my once in a lifetime trip to Machu Picchu.

This is about principle, so if 3-4 days there costs me $2,000. So be it.

Enough is enough.

[gerard]

But LAN now seem to be offering a base plus option that's only $30 dearer each way than the residents only price. Why would you book the base option and then pay $178 fine instead of base plus for only $60 more return? It is a more flexible ticket though, so there is some "value" in the extra charge.

Star Peru look to be about the same price as LAN's base, with no residency restrictions, and hence $60 cheaper then the LAN gringo price.