Originally Posted by virtualtroy
Cost, presumably. OW demands certain standards of 'excellence' in service, marketing etc. for a carrier to join (as founder member AA is testament to, this has more to do with market impact on existing members than so-called excellence). I'm guessing that it made sense to join LAN Peru because of thru-traffic, while for Ecuador perhaps this makes less sense... just a hunch
It's because Lan Argentina, Lan Ecuador and the now defunct Lan Dominicana are all less than 50% owned by Lan Chile so not subsidiaries. A previous poster said that Lan Peru was also less than 50% owned by LA, but that's incorrect. I dont remember the exact amount off hand, but its somewhere around 80% ownership. Most of South America is very protective and foreign ownership has been historically discouraged. Peru and Chile have a bilateral agreement that permits foreign ownership in each others countries. So Lan Chile is legally able to own more than 50% of Lan Peru and is able to make them into a subsidiary.