Elected new president of Argentina on Sunday, November 19, the ultra-liberal Javier Milei has already said what he intends to do with Aerolíneas Argentinas, the state-owned carrier and largest airline in the country.
For the president-elect, the company’s destiny is to be privatized, but into the hands of the employees themselves who would then decide its future in the midst of an open skies environment.
To give the new owners time to organize the company, the government would provide financial support for 12 months.
Aerolíneas Argentinas “has highly qualified personnel and profitable business units. You have to leave that to the employees. In a context of greater competition, the employees themselves will expel those who dedicate themselves to politics instead of working,” stated Milei.
The idea, however, was initially rejected by its employees’ unions, who consider that Aerolíneas could go bankrupt without government help.
Founded in 1949, Aerolíneas Argentinas became state-owned in 1979. In 1990, however, it was privatized and taken over by a consortium led by the Spanish company Iberia, which remained in the company for 11 years.
After a critical period in which it was in the hands of the Marsans group, the airline was nationalized in 2009 during the government of President Cristina Kichner.
Her successor, Mauricio Macri, launched an air travel deregulation program that opened space for the expansion of the number of airlines and routes, which reduced Aerolíneas’ market share.
In 2019, new president Alberto Fernández took the opposite path, making it difficult for private airlines to operate and investing in the state carrier.
Plan to acquire E195-E2 jets
During the campaign months, Aerolíneas announced plans to expand and modernize its fleet, which included the order of 12 Embraer E195-E2 jets.
The deal, however, has not been confirmed by the manufacturer so far, despite a trip made by the airline’s management to Brazil.
According to local media, Aerolíneas Argentinas has almost 12,000 employees, including people who were at Austral Lineas Aéreas, the airline that merged with it in recent years.
Aerolíneas is a public limited company in which employees hold only a tiny portion of the shares. The path to privatization would therefore be clear, as approval from the majority of the Argentine Congress is not required to sell it.
The state-owned airline has a fleet of 84 aircraft, which includes 10 Airbus A330-200s for long-distance flights, 48 Boeing 737s, including MAX 8 models, and 26 Embraer E190s.
Among the international routes, several Brazilian cities stand out, Miami and New York, in the USA, Havana, Madrid and Rome, among others.