LAN and TAM Airlines invest more than US$100 million in technology to improve passenger experience

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1 LAN and TAM Airlines invest more than US$100 million in technology to improve passenger experience The airlines introduced eight technology products and solutions to optimize service quality, improve passenger experience and facilitate the jobs of its workforce. Santiago, Chile, November 27, LAN Airlines and its affiliates and TAM Airlines, part of LATAM Airlines Group, invested more than US$100 million in technology projects in 2014 that will improve the passenger experience and facilitate the job of its workforce. As part of the first LAN and TAM e- an annual event to showcase the latest technological advances of LATAM Airlines Group, the airlines announced eight digital advances that seek to enhance the LAN and TAM Airlines passenger experience and provide better service before and during the flight. Below are the main innovations introduced by LATAM Airlines Group On the ground: The projects presented include big advances and investments in smartphone applications. Thanks to these applications, passengers on both airlines can manage all aspects of their trip via the LAN and TAM mobile app, and also get an electronic boarding pass. Another improvement is the development of systems to more efficiently update and communicate the company's Flight Status information, giving passengers more information about their flights and available options in the event of any changes as they occur. In Flight: LAN and TAM introduced a partnership with YouTube, and starting this month, the airlines will incorporate the best content selected from the search engine's most popular channels into their in- flight entertainment offering. At the event, the airlines also announced the launch of LAN and TAM Entertainment, a wireless in- flight entertainment system for personal devices allowing passengers to watch movies, TV shows and videos via their own mobile devices including smart phones, tablets and lap tops. "At LAN and TAM, we want passengers to have the ability to make the best use of their time. We are transforming the traditional travel experience to a faster, mobile experience, with less waiting in line at airports, shorter connection times, more in- flight entertainment options, and better information in the event of contingencies," explained Jerome Cadier, LATAM Airlines Group VP of Marketing. We are one of the companies offering the most smart phone and tablet solutions and services in Latin America. Workforce improvements that impact customer service The LAN and TAM digital strategy also involves implementing new technologies that simplify and optimize the job of its workforce, aimed at making a contribution to the excellent service each worker provides passengers, directly or indirectly. 1

2 As such, LAN and TAM introduced three projects in which they will implement tablets loaded with software specifically- designed to manage the data and operations of the Head Flight Attendants, Pilots, and Aircraft Maintenance Hubs. This will reduce data processing times, costs, resources, and improve safety and efficiency rates for ground and in- flight operations. Digital solutions for LAN and TAM Cargo customers In addition to the passenger operation, the LAN and TAM Cargo units are also developing an investment plan for systems totaling US$ 25 million in digital solutions for cargo customers. About LATAM Airlines Group S.A. LATAM Airlines Group S.A. is the new name given to LAN Airlines S.A. as a result of its association with TAM S.A. LATAM Airlines Group S.A. now includes LAN Airlines and its affiliates in Peru, Argentina, Colombia and Ecuador, and LAN Cargo and its affiliates, as well as TAM S.A. and its subsidiaries TAM LinhasAereas S.A., including its business units TAM TransportesAereos del Mercosur S.A., (TAM Airlines (Paraguay)) and Multiplus S.A. This association creates one of the largest airline groups in the world in terms of network connections, providing passenger transport services to about 135 destinations in 24 countries and cargo services to about 145 destinations in 27 countries, with a fleet of 319 aircraft. In total, LATAM Airlines Group S.A. has approximately 53,000 employees and its shares are traded in Santiago, as well as on the New York Stock Exchange, in the form of ADRs, and Sao Paulo Stock Exchange, in the form of BDRs. Each airline will continue to operate under their current brands and identities. For any inquiry of LAN or TAM, please visit or respectively. Further information at 2

3 ANNEX Digital Advances introduced at the LAN and TAM e- 1. LAN and TAM Airlines app / Mobile Boarding Pass LAN and TAM launched their mobile app for ios in July, and in November it became available for Android. The application is free and makes traveling easier for passengers, allowing them to check in, select seats, save their boarding passes without the need to print them, check flight status and keep a record of their trips from their smartphone. The application is available in 20 countries and is the most popular airline app in the region, with more than 500,000 downloads. LAN and TAM are continuing to work to offer more solutions to their passengers through the application, and translate its benefits into a better passenger experience. 2. Flight Status With new technologies implemented on LAN and TAM Airlines websites, both airlines will be able to give passengers more detailed information as well as provide reasons for flight status changes in the event of contingencies. This gives passengers more tools and access to information, which can help them make their own informed decisions, and thereby make better use of their time. If we have the information, we want our passengers to have it in a timely manner, emphasized Jerome Cadier, LATAM VP of Marketing. It is available at LAN.com and will soon be available in the LAN and TAM Airlines app. 3. Electronic devices throughout the duration of the flight LAN and TAM Airlines are the first airlines in South America to allow the use of mobile devices in "airplane mode" throughout the entire flight. This policy took effect on October 15, 2014 on flights operated by LAN Airlines in Ecuador, and was then implemented throughout the entire fleet. This solution means that the work, entertainment or information passengers access via their devices will not be interrupted at any stage of the flight. To make this possible, LAN and TAM worked with aviation authorities of each of the countries in which they operate. 4. LAN and TAM Airlines Entertainment 3

4 In December 2014, LAN and TAM will debut the first aircraft in South America with a wireless in- flight entertainment system, enabling passengers to enjoy in- flight entertainment on their mobile devices: smartphone, tablet or laptop. To access the content, passengers download the LAN and TAM Entertainment application and connect to an in- flight entertainment portal via a wireless network (without Internet connection) inside of the aircraft. Through the app, passengers can enjoy movies, TV series, music, news, books, tourist information and more. The app is compatible with Android, ios smartphones, tablets and laptops. Within 18 months, the airlines will install this service in 300 aircraft operating on domestic and regional routes. LAN and TAM are the first airlines in South America to implement wireless in- flight entertainment. 5. Onboard YouTube As of November 2014, all domestic and international flights on LAN and TAM will have the most popular YouTube channels on their in- flight entertainment network. Thanks to this partnership, YouTube will provide LAN and TAM with the most popular content from its site and update it monthly on all its entertainment systems. LAN and TAM will be the second airline group in the world to offer this type of innovative onboard content (the first being Virgin America). Moreover, YouTube is the second most popular search engine on the Internet and more than one billion unique users visit YouTube each month (according to the company's own statistics.) 6. Tablets for Crewmembers LAN and TAM implemented a new data management system for the crew on board, where they can have the information they need to do their jobs in digital format and all in one place. The airlines distributed more than 2,000 tablets to their Head Flight Attendants, pre- loaded with all flight information, allowing the flight crew to collect important information related to the onboard service of each flight, the flight crew providing the service, and key passenger information. This new system will streamline and optimize the cabin crew's work, and reduce the response time for the processing of data from 15 days to only one day. This will save more than 100,000 pieces of paper per month. 4

5 LAN and TAM are the first airlines in Latin America to implement tablets for in- flight onboard service, and thanks to these technologies we are going to be able to offer even more personalized service, explained Jerome Cadier. 7. Tablets for Pilots LAN and TAM will add data management tablets for pilots in all aircraft and flight simulators, so that the Crew can do their jobs more efficiently. These electronic devices use software designed to replace printed reference material pilots keep in their flight bag. They will contain manuals and flight certificates, operational performance calculations and navigation charts on board in digital format. With this, LATAM Airlines Group becomes the first airline group in Latin America to have an Electronic Flight Bag (EFB) with software, hardware and digital documentation of this scope, in the cockpit for the Cabin Crew. One of the primary benefits of this project is that it reduces the amount of paper on board, resulting in significant fuel savings, and improves the pilots' flight experience, since it allows them to have improved situational awareness in flight and more efficient navigation. It also reduces information update time from two weeks to two days, and frees up space in the cabin. LAN and TAM are currently engaged in the approval process with the respective local authorities and plan to implement the policy in the first half of 2015 throughout the entire LATAM Airlines Group fleet and pilot training flight simulators. 8. Tablets for Maintenance LAN and TAM are implementing a new data management system to facilitate and optimize maintenance work on their aircraft. To do this, the companies will be providing their mechanics and engineers with tablets loaded with specially- designed software that will give them direct access to manuals, interactive videos and all the content they need to detect errors, and access airline manufacturer spare part inventory. This information will also be available offline. This new system will represent a fundamental change in the way maintenance is performed at LAN and TAM aircraft maintenance hubs, since it will significantly reduce the time mechanics use to repair aircraft, from the time they discover a problem, to the time they find the solution in the corresponding manuals. LATAM Airlines Group will be the first airline group in South America to have this technology, which in addition to reducing maintenance time will allow the companies to optimize safety and operating standards as well assave the equivalent of 600 trees in paper each year. LAN and TAM Cargo Business 5

6 Just like the passenger business, the LAN and TAM Cargo units are developing an investment plan for systems totaling US$25 million in digital solutions for cargo customers. These services go hand in hand with sustainable development, replacing paper with electronic data. One of the projects in development is the e- AWB, which involves replacing the master AWB with an electronic message containing all shipment information. The company's goal is to have 41% of the AWB transmitted by electronic means by December of Other e- Business tools used by LAN and TAM Cargo units are e- Freight, e- Tracking, e- Booking and a messaging service. The primary goal in implementing these tools is to make communication and shipment status information more efficient, integrated and automatic. 6

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