Aerolíneas Argentinas’ new CEO, Pablo Ceriani, called “crazy” the previous management’s plan to sell all the company’s Embraer E190 jets and replace them with larger, leased aircraft.
In an interview with Pagina12, the executive who took over the Argentine government-controlled airline revealed that the aim of the new direction is to renew the fleet of E190 jets by the second-generation model E195-E2, which in his view is better suited to the Argentine market.
“This is crazy (selling the E190) because the Embraer jet fleet is its own and an important part of the company’s assets. We are proud because we are one of the largest Embraer operators in the world. It is a very versatile aircraft that allows operations that cannot be done by a larger aircraft. On the contrary, the objective would be to renew the fleet with the new E195-E2 line, which adapts to the Argentine market. It makes no sense to switch from a fleet of your own to a leased one. I think they (the previous management) wanted to make money,” accused Ceriani.
The new CEO was nominated by the new Argentine president, Alberto Fernandez, from the leftist Justicialista party. He replaces Luiz Malvido, an executive linked to former President Macri, who sought to deregulate commercial aviation in Argentina, something the new mandate has already signaled is likely to end.
Aerolíneas Argentinas currently has 26 E190 jets, acquired from 2010. The aircraft are operated by the subsidiary Austral Líneas Aereas, which operates domestic flights and short-haul international segments.
More criticism of previous management
The new president of the company still made harsh criticism of the predecessor. According to Ceriani, Aerolíneas Argerninas was in a situation of vulnerability that will not be easy to reverse and that will require a government contribution of $ 700 million to recover the company. “We (in 2015) left a company with a net worth of $ 75.9 million and $ 200 million in liquidity, and they left it with a negative equity of $ 441.9 million and 24 fewer routes,” said Ceriani.
The president of Aerolíneas Argentinas also accused Mauricio Macri’s government of using the company’s fleet as an asset to get new loans. For the executive, the previous administration got loans by offering its own aircraft as warranty instead of selling and leasing them again.
Ceriani also complained about former Argentine Transport Minister Guillhermo Dietrich and said he “sought to benefit foreign and low-income companies and market deregulation.”
Thanks to the opening of the market, the first low cost airlines in the country, such as Flybondi, JetSmart and Norwegian Air Argentina, emerged. However, the latter was eventually sold to its rival of Chilean origin.
Another likely change underway by the new president is reopening Jorge Newberry Airport, also known as Aeroparque, for international flights.
The terminal, located near the center of Buenos Aires, no longer offers international connections under previous management, which preferred to prioritize Ezeiza airport and allow low cost flights from El Palomar air base, but does not have adequate infrastructure.
Now the idea is just to relieve Ezeiza, which should happen from May 11th. By then, the government must decide how it will distribute Aeroparque slots that currently only have international flights to Uruguay.