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Airlines in Chile Customer Challenges and Pains Analysis

Challenges and Pains faced by Customers

Based on the analysis of the provided reports, the final customers in the Chilean airline industry, predominantly B2C passengers, face several challenges and pains throughout their journey within the value chain. While the reports focus more on the airline's operational and market challenges, they do highlight pain points that directly impact customers.

The main challenges and pains identified are related to operational disruptions, the complexities and costs associated with ancillary services, and issues with customer service and complaint resolution.

  1. Operational Disruptions: Customers experience pain when flights are delayed or cancelled. While not explicitly detailed from the customer's perspective in the provided text, the mention of "operational disruptions" due to "aircraft and personnel shortages" [Value Chain Analysis: Abstract, Bottlenecks and Challenges] directly translates to customer pain in the form of disrupted travel plans, missed connections, and inconvenience. The need for airlines to resort to "wet lease agreements" [Value Chain Analysis: Bottlenecks and Challenges] due to these shortages underscores the underlying issue impacting operational reliability, a key factor for customer satisfaction.
  2. Ancillary Service Costs and Complexity: Particularly for customers of low-cost (SKY) and ultra-low-cost (JetSMART) carriers, the unbundling of services presents a challenge. While attracted by low base fares, customers face additional costs for services traditionally included in full-service fares, such as "checked baggage allowance, seat selection... and flexibility options for ticket changes" [Value Chain Analysis: Value Chain Definition: Ancillary Services]. For ULCCs like JetSMART, "almost all services are unbundled and sold separately" [Value Chain Analysis: Players Analysis: JetSMART], making ancillary services "fundamental to their business model" and a "major portion of their revenue" [Value Chain Analysis: Value Chain Relationships and Business Models]. This can lead to unexpected higher final costs and a potentially confusing booking process where each add-on must be considered and paid for separately.
  3. Customer Service and Complaint Management: The reports explicitly mention "managing passenger complaints" as a challenge [Value Chain Analysis: Bottlenecks and Challenges] and note that JetSMART is "implementing measures to reduce high quantity of passenger complaints" [Industry Research: Examples of Main Players: JetSMART, Value Chain Analysis: Bottlenecks and Challenges, References]. This indicates that customers experience pain points related to the quality and responsiveness of customer service, potentially including issues with booking changes, refunds, handling of delays or cancellations, or addressing baggage problems.

Based on the direct mentions and implied impacts from the operational challenges discussed in the reports, these customer pains can be prioritized as follows:

Priority Challenge/Pain Description
1 Operational Disruptions Delays, cancellations, and other inconsistencies in flight schedules due to airline operational issues.
2 Ancillary Service Costs and Complexity Unexpected or high additional costs for services beyond the base fare, particularly with LCCs/ULCCs.
3 Customer Service Issues Difficulties in getting support, resolving problems, and managing complaints with airlines.

Correlation with Value Chain

These customer challenges and pains are directly correlated with specific steps and bottlenecks within the airline value chain in Chile:

  • Operational Disruptions are primarily correlated with the Flight Operations and Network Planning & Scheduling steps, and are a direct consequence of bottlenecks in Aircraft Acquisition & Maintenance and Personnel Shortages. When airlines face "aircraft and personnel shortages" [Value Chain Analysis: Bottlenecks and Challenges], it impacts their ability to execute the planned schedule ("Flight Execution") and manage crew availability ("Flight Crew Management"). This leads to delays and cancellations that affect the customer's ability to travel as planned. The necessity of "wet lease agreements" [Value Chain Analysis: Bottlenecks and Challenges] highlights the severity of these upstream bottlenecks impacting core operations and, consequently, the customer experience.
  • Ancillary Service Costs and Complexity are directly tied to the Ancillary Services step and the business models of LCCs and ULCCs like SKY and JetSMART. The strategic decision within Network Planning, Marketing & Sales, and Ancillary Services to unbundle fares and rely heavily on selling add-ons fundamentally shapes the customer's purchasing experience and the final price they pay. While this strategy allows for lower base fares (a benefit), the pain arises from the cost and potential lack of transparency or complexity in managing these additional purchases during the Marketing & Sales (Distribution) process.
  • Customer Service Issues are predominantly linked to the Marketing & Sales (Distribution) and Passenger & Cargo Handling (Airport Operations) steps. Customer Relationship Management (CRM) is a segment within Marketing & Sales [Value Chain Analysis: Value Chain Definition: Marketing & Sales]. Pains related to complaints indicate potential shortcomings in how airlines manage interactions before travel (inquiries, booking changes), during airport processes (check-in, baggage handling), and after the flight (resolving issues). The explicit mention of JetSMART addressing "passenger complaints" [JetSMART confirma procesos para reducir alta cantidad de reclamos de pasajeros.] underscores the direct link between the customer's experience with the airline's handling of issues and the challenges within these downstream value chain activities.

In summary, customer pains are not isolated incidents but are often direct outcomes of operational, strategic, and process-related challenges faced by airlines within specific stages of their value chain. Shortages in upstream resources impact core flight execution, business model choices around unbundling affect the sales and post-sales purchasing experience, and the effectiveness of customer-facing processes at the airport and in support channels determines the level of customer service pain.

References

  • ¿Qué aerolíneas están funcionando en Chile? en Recomendaciones de viajes - Turismocity. (2024, March 26).
  • Empresas del turismo anticipan para el verano 2024-2025 preferencias por destinos nacionales - Ladevi Chile. (2024, December 16). https://ladevi.cl/empresas-del-turismo-anticipan-para-el-verano-2024-2025-preferencias-por-destinos-nacionales-n-47231
  • LATAM Airlines Group cierra un año récord con un EBITDAR ajustado superior a los US$3.100 millones y una utilidad neta de US$977 millones, junto con un sólido crecimiento de la capacidad del 15,1%. (2025, January 31). https://www.latamairlinesgroup.net/es/press-releases/latam-airlines-group-cierra-un-ano-record-con-un-ebitdar-ajustado-superior-a-los-us-3100-millones-y-una-utilidad-neta-de-us-977-millones-junto-con-un-solido-crecimiento-de-la-capacidad-del-151/
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  • LATAM alcanza utilidades por US$ 258 millones y consolida tendencia positiva en sus resultados. (2024, May 2). https://www.latamairlinesgroup.net/es/press-releases/latam-alcanza-utilidades-por-us-258-millones-y-consolida-tendencia-positiva-en-sus-resultados/
  • JETSMART TUVO VARIACIÓN EN PAXS TRANSPORTADOS - T News. (2025, January 6). https://tnews.com.pe/jetsmart-tuvo-variacion-en-paxs-transportados/
  • Rapa Nui: volumen de pasajeros se acerca a los registros prepandemia - Ladevi Chile. (2025, April 21). https://ladevi.cl/rapa-nui-volumen-pasajeros-acerca-registros-prepandemia-n-47837
  • LATAM Airlines alcanza récord de pasajeros y crecimiento financiero en 2024. (2025, February 3). https://www.americaeconomia.com/negocios-e-industrias/latam-airlines-alcanza-record-de-pasajeros-y-crecimiento-financiero-en-2024
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  • Resultados Cuarto Trimestre y Año Completo 2023 | LATAM Airlines Group SA. (2024, February 22). https://s22.q4cdn.com/822217734/files/doc_financials/2023/q4/LATAM-Airlines-Group-Results-Presentation-Q4-2023-ok-vf.pdf
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  • Las aerolineas mas puntuales del mundo en 2024 - CNN en Español. (2025, January 2). https://cnnespanol.cnn.com/2025/01/02/aerolineas-mas-puntuales-2024-orix/
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  • Latam Airlines: Chile destaca en crecimiento operacional de la aerolínea en Latinoamérica. (2025, March 20). https://mercados.lainformacion.com/latam-airlines-chile-destaca-en-crecimiento-operacional-de-la-aerolinea-en-latinoamerica
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  • Resultados 1T 2025 - LATAM Airlines Group lleva su margen operacional ajustado al 16,8% en el primer trimestre y reporta una utilidad neta de US$355 millones. (2025, April 28). https://www.latamairlinesgroup.net/es/press-releases/resultados-1t-2025-latam-airlines-group-lleva-su-margen-operacional-ajustado-al-168-en-el-primer-trimestre-y-reporta-una-utilidad-neta-de-us-355-millones/
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  • JetSMART confirma procesos para reducir alta cantidad de reclamos de pasajeros. (2024, April 16). https://www.americaeconomia.com/negocios-e-industrias/jetsmart-confirma-procesos-para-reducir-alta-cantidad-de-reclamos-de-pasajeros
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  • Latam cierra el 2024 con los mejores resultados de su historia: ganancias se disparan en casi un 70% - La Tercera. (2025, January 31). https://www.latercera.com/pulso/noticia/latam-cierra-el-2024-con-los-mejores-resultados-de-su-historia-ganancias-se-disparan-en-casi-un-70/M6L7C8Z2QZHLVGJ2B5T5L5B5M4/
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