Founded at La Paz in 1962 to operate nonscheduled all-cargo services around the country. A lightplane and Douglas DC-3 fleet is employed to begin revenue services.
En route from Caranavi to La Paz on December 8, 1964, a chartered DC-3 with 4 crew and 13 passengers suddenly disintegrates and crashes near Tripuani in the Andes Mountains at an altitude of 14,000 ft. Investigators will suggest that the cause of the tragedy is an explosion of a “criminal origin,” and although a suicide-for-insurance plot is suspected, no one is ever indicted.
The fleet is augmented with 2 Curtiss C-46 Commandos in October 1966, which are employed through November 1968. The carrier shuts down during the energy crisis in 1972.
AEROLINEAS AMANCER, S. A. de C. V.: Calle C. Hangar 6; Toluca Airport; Toluca, 50200, Mexico; Phone 52 (72) 731 220; Fax 52 (72) 172 885; Year Founded 1990. Certified to fly executive charters from Central America to Canada, Amancer is established at Toluca Airport in 1990. Ten years later, flights are still undertaken with a single Learjet 24.
AEROLINEAS ARGENTINAS, S. A.: Bouchard 547, 1106 Buenos Aires, Argentina; Phone (54-1) 317-300; Fax (54-1) 317-3596; Http://www. aerolineas. com. ar; Code AR; Year Founded 1949. This new state corporation is formed on May 3, 1949 at Buenos Aires. A division of the Ministry of Transport, which has provided capitalization, Aerolineas Argentinas is a merger of four independents: Aero-posta Argentina, S. A.; ALFA (Aviacion del Litoral Fluvial Ar-gentino, S. A.); FAMA (Flota Aerea Mercante Argentina, S. A.); and ZONDA (Zonas Geste y Norte de Aerlineas, S. A.). Routes, aircraft, and personnel of the merger partners are amalgamated, if not integrated, during the remainder of the year, with the unified carrier appearing in December.
Integration efforts continue in 1950. Ten ex-FAMA (Flota Aerea Mercante Argentina, S. A.) Douglas DC-4s join the fleet along with 6 DC-6s; the latter begin service to New York on March 21.
A DC-3 must be written off following an accident at Buenos Aires’ Pistarini Airport on June 12; there are no fatalities.
A DC-6 begins a New York to Buenos Aires via Trinidad proving flight on September 13. The four-ship fleet of new Convair CV-240s ordered by ZONDA (Zonas Geste y Norte de Aerlineas, S. A.) is also delivered in September. Christened Yapeyu, Uspallata, San Lorenzo, and Chacbuco, they are placed on routes to Santiago de Chile, Cordoba, and Mandoza.
The route network is fully integrated as of December 7. Three Avro Yorks ordered by merger partner FAMA (Flota Aerea Mercante Argentina, S. A.) are received late in the year; undesired, they are returned to their British manufacturer. Other aircraft obtained from merger partners during the year include: 33 DC-3s (2 ALFA, 6 FAMA, 17 ZONDA, and 5 Aeroposta Argentina); 4 former-ALFA S.25 Sandringhams; 1 former ALFABeech 18S, and 1 ex-FAMA Cessna UC-78A. Two DC-6s are received from United Air Lines and an S.25 Sandringham is purchased from SAS (Scandinavian Airlines System).
The ex-ZONDA DC-3 Puntano with 5 crew and 13 passengers and en route from Mar del Plata to Buenos Aires, crashes near Cobo on December 30 (17 dead).
During the year the carrier’s Andean condor emblem is designed by Rodolfo Pena.
The former Aeroposta Argentina, S. A. DC-3 Yagan with 4 crew and 16 passengers fails its climb from Rio Grande on a March 26, 1951, service to Ushuaia and crashes; 11 people aboard the aircraft are killed, along with two on the ground.
A DC-3 crashes at Jujuy, Argentina, on June 3; although the plane must be written off, there are no fatalities.
Two Shorts S.25 Sunderland 5s, the Uruguay and Rio de la Plata, join the five S.25s already in the fleet in maintaining flying boat service to Montevideo.
In April 1952, the carrier’s administration is transferred to the National Transportation Corporation, which is charged with running all of the nation’s air, rail, and road communications. A month later, Aerolineas Argentinas joins IATA.
In cooperation with Bolivia’s LAB (Lloyd Aereo Boliviano, S. A.),
DC-4 flights begin to Santa Cruz in early 1953.
An ex-FAMA C-54A with 7 crew and 34 passengers is lost 12 miles north of the city while on initial approach to Cordova on June 17; although the aircraft is damaged beyond repair, there are no fatalities.
As the result of an improper initial approach, the former Aeroposta Argentina, S. A. DC-3 Quilmas with 4 crew and 21 passengers strikes a mountain near Sierra del Vilgo, in La Rioja Province, on April 23, 1954; there are no survivors.
On June 26, the government launches an investigation of the carrier’s management, seeking proof of fraud allegations.
While on a scheduled service from Cordoba on October 16, a CV-240 with 5 crew and 32 passengers is caught in a storm and suffers uncontained loss of altitude from 600 m. up. Although the aircraft is destroyed when it strikes the ground SSW of Capilla del Senor, there are no fatalities.
In April 1955, DC-6 service is inaugurated to La Paz. While climbing away from Rio Chaco, Argentina, on May 20, the former ZONDA (Zonas Oeste y Norte de Aerolineas Argentinas, S. A.) DC-3 Coya, a freighter with 4 crew and 1 passenger, suffers propeller failure, loses height and crashes; although the aircraft must be written off, there are no fatalities.
The Peron dictatorship ends on September 16.
A government decree on July 12, 1956 ends the carrier’s monopoly over national air transport. Having descended below the MDA, the former ZONDA (Zonas Oeste y Norte de Aerolineas Argentinas, S. A.)
DC-3 Ibate with 4 crew and 14 passengers crashes and burns near Rio Cuarto four days later; there are no survivors.
A new government decree in 1957 defines the manner of state airline control.
On January 11, a DC-4 with 33 aboard crashes shortly after takeoff from Buenos Aires (12 dead). Another DC-4 crashes near Bolivar, southwest of Buenos Aires, on August 12 (62 dead) and the third four-engine Douglas of the year, which once belonged to United Air Lines, crashes 25 km. SE of Bolivar on December 8 (62 dead). A Short Sandringham flying boat with eight aboard fails its takeoff from Buenos Aires on December 31 and crashes; there are no survivors.
Following the installation of the democratically elected government administration of Dr. A. Frondisi in February 1958, the carrier’s entire leadership is forced to resign in May, at which point Col. Guiraldes becomes president. Orders are placed for six de Havilland DH 106 Comet 4s.
A DC-6 with 6 crew and 16 passengers is lost off Ilha Grande Beach, Brazil, on June 10; there are no fatalities.
Late in the year, Guiraldes is succeeded by Brig. Gen. Miguel Mor-agues. Orders are placed for 10 Fairchild F-27s; the request will be cancelled within two years because financing does not materialize.
The first jetliner for Aerolineas Argentinas, a Comet 4, is delivered on March 2, 1959; christened Las Tree Marias, it is employed to open South America’s first indigenous commercial jet service on April 16 from Buenos Aires to Santiago de Chile and on to New York. An unnamed ex-FAMA (Flota Aerea Mercante Argentina, S. A.) DC-3 with 4 crew and 6 passengers is lost in a crash on May 15 following its takeoff from Mar del Plata; there are no survivors.
Four days later, a Comet 4 inaugurates the first regularly scheduled turbojet airliner service from South America to the U. K., flying from Buenos Aires to London. As additional Comet 4s are received, they commence frequencies on June 7 from Buenos Aires to Rome, Frankfurt, and Paris, via Rio de Janeiro, Recife, and Port of Spain.
The ex-ZONDA (Zonas Oeste y Norte de Aerolineas Argentinas, S. A.) DC-3 Tierra del Fuego with 3 crew and 7 passengers is lost at Santiago del Estado, Argentina, on July 24; there are no fatalities.
Diverted to Asuncion, the Comet 4 Lucero del Alba with 6 crew and 44 passengers and en route from Buenos Aires to New York, crashes on August 26 during its final approach (2 dead).
On September 4, New York to Buenos Aires flights are cut from three to two weekly as a result of the Asuncion disaster.
Having lost hydraulic fluid, a CV-240 with 6 crew and 26 passengers must make an emergency landing in a vineyard near Mendoza, Argentina, on December 12; there are no fatalities.
All flights are cancelled between January 27 and February 5, 1960, because of a workers’ slowdown.
As the result of a bad landing at Ezeiza Airport, Buenos Aires, after a training flight on February 20, the DH 106 Comet 4 Cruz del Sur must be written off; none of its six-person crew are fatalities.
Buenos Aires to New York service is temporarily curtailed on March 3. On March 10, all flights are again halted, as pilots strike to protest the punishment of six colleagues accused of safety violations.
As the result of a violent storm, a DC-6 with 6 crew and 25 passengers and en route from Asuncion to Buenos Aires, explodes in midair and crashes 12 km. ENE of Salto (Uruguay) on September 7; there are no survivors.
On September 30, the carrier cancels its Havana stops on the New York to Buenos Aires runs now fully restored. In terms of passenger kilometers flown during the year, the carrier now ranks as the largest airline in Latin America.
An operating permit for New York is received from the U. S. CAB in January 1961. On March 16, orders are placed for nine Avro (later Hawker Siddeley, then British Aerospace or BAe) 748s, followed by an August request for three (later four) Sud-Est SE-210 Caravelle VINs. Meanwhile, on June 9, the carrier is struck after suspending 5,600 workers for their continuing slowdowns.
On July 19, a DC-6 with 7 crew and 60 passengers crashes near Azul; there are no survivors.
The DH 106 Comet 4 Arco Iris with 12 crew and 40 passengers crashes 4 mi. from Viracopos Airport, Sao Paulo, on November 23 just after takeoff for New York. Again there are no survivors. The public outcry and political repercussions within Argentina over these accidents forces President Moraguez to resign.
The first Avro 748, the second production unit, is delivered in January 1962; christened Ciudad de Bahia Blanca, it begins Pointe del Estes-Bahia Blanca service on April 2. AA thus gains the distinction of introducing the “Budgie,” as it will be nicknamed, into commercial service. Meanwhile, the first Caravelle VIN is received in March; named Aldebaran, it launches flights from Buenos Aires to San Carlos de Basiloche on April 1. The company promotes both new aircraft types in new print and television advertising; however, the addition of the presence is criticized by the Association Argentina de Aeronavegantes, the flight attendants union.
All Avro 748s are ordered flown at low altitude on September 2, pending a probe into the death of stewardess Olga Gomez, who fell to her death when the plane door blew off on August 30 flightflhours earlier a second 748 also lost its door. During a September 4 test flight to attempt to isolate the problem, an Avro technician nearly falls from his aircraft when its door locking system fails.
Airline and manufacturing representatives order the entire Avro fleet grounded on September 7 and the Convairs, awaiting sale, are returned to duty. The political difficulties that now ensue between airline officials and government bureaucrats attempting to place blame reach a point where, on October 16, CEO Moragues is dismissed. Having been modified, the Avro 748s are gradually returned to service after November 1.
The last Short S.25s are retired at year’s end, the CV-240s are sold to the Paraguayan Air Force, and the first Comet 4C is delivered and named President Kennedy.
The fleet in 1963 now comprises 14 DC-3s, 6 DC-4s, 3 DC-6s,
3 Comet 4s, 4 Hawker Siddeley HS 748s (Avro having become the Avro Whitworth Division of Hawker Siddeley), and 3 SE-210s. A dispute with lATA leads to the carrier’s resignation from that international body on June 7.
Flight 527/03, an SE-210 Caravelle VIN with 7 crew and 63 passengers crashes while on final approach to Cordoba on July 3; there are no fatalities.
A DC-3 with 3 crew and 27 passengers crashes near Zarate on January 9, 1964 (28 dead). A Comet 4C is received in May, the same month the CAB grants traffic rights to Miami. Brig. Gen. Guillermo Zinny (Ret.) becomes chairman in June. Enplanements for the year total 717,661.
Airline employment in 1965 is 5,921. The 40-aircraft fleet is altered as 5 DC-3s are replaced by 8 HS 748s. On February 5, orders are placed for 4 Boeing 707-387Bs. Comet 4 service to Miami via Lima begins in April. On October 6, the company rejoins IATA. Passenger boardings rise 1.3% to 727,113.
A government change in June 1966 brings another shift in the carrier’s administration, this one headed by Brig. Gen. Arnaldo Tesselhoff (Ret.).
On September 28, to publicize Argentina’s long-standing claim to the Islas Malvinas (Falkland Islands), 18 Argentine nationalists hijack the DC-4 Benjamin Matienzo (which had been delivered new to Santa Fe Skyways of the U. S. 20 years earlier as the Sky Chief Pueblo) en route from Buenos Aires to Rio Gallegos. The hijackers force the pilot to fly to Stanley to hand out propaganda leaflets. The whole group will be extradited back to Argentina and its members will receive prison terms ranging from three to five years.
The first B-707-387B is delivered in November and is placed in service on the New York run on December 15.
On August 8, 1967, a B-707-387B, operated jointly with Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.), inaugurates 6,462-mile nonstop service from Buenos Aires to Madrid, the world’s longest nonstop scheduled frequency. The B-707-387Bs take over the long-haul routes to Europe and eliminate the Dakar stop; the Comet 4s are transferred to regional service. In December, two Nihon YS-11As are put on the holiday routes from Buenos Aires to Mar de Plata and Punta del Este.
The CAB is approached, in 1968, for a West Coast route. Once it is granted, B-707-387B service to Los Angeles, via Lima, Bogota, and Mexico City, begins in April 1969. Tokyo flights are inaugurated on June 15.
An HS-748-B1 with 4 crew and 35 passengers is destroyed as the result of a bad landing at Bahia Blanca on July 15; there are no fatalities.
While on domestic flights on October 8, a company aircraft and a Cruziero do Sul, S. A. airliner are both hijacked to Havana. Four armed men capture the Aerolineas Argentinas B-707-387B with 67 passengers during a domestic service from Belem to Manaus.
While on night approach to the airport at La Pampa on November 27, a HS-748-1A with 4 crew and 24 passengers lands 3 km. short of the runway, skids 200 m., strikes a fence, and comes to rest in a wheat paddock; there are no fatalities.
Orders are placed in 1970 for six B-737-287s. An HS-748-1A with
4 crew and 33 passengers suddenly turns over and dives into the ground 35 km. S of Corrientes on February 4 at a speed of 400 km/hr.; there are no survivors.
A man and a pregnant woman force a Comet 4 with 68 passengers and en route from Cordoba to Tucuman, to fly to Cuba on March 24. Technical problems cause a stop at Lima and the flight is not concluded until next day.
En route from Salta to Buenos Aires on July 28, a new B-737-287 with 32 passengers is taken over by a hijacker armed with two pistols, who allows the plane to stop at Cordoba on its way to Cuba to drop off half of the passengers. In the air again, the “Baby Boeing” encounters a snowstorm over the Andes and must return to Cordoba. There the pirate surrenders to police.
An Hs-748-1A is destroyed as the result of a bad landing at Sar-miento, Argentina, on December 19; there are no fatalities.
A new government brings yet another shift in air transport policy in 1971, by which year all of the DC-3s, DC-4s, and DC-6s have been withdrawn. Six more B-737-287Bs are requested. Gen. Roberto M. Levinston, suspected organizer of an ill-fated Argentine coup, hijacks a B-707-387B on October 10 and attempts to force the aircraft crew to fly it to a military base where rebel forces hope to mass in resistance; Levin-ston never gets off the ground.
Buenos Aires-Lima-Los Angeles flights commence on May 19, 1972. As the B-737-287Bs enter service, the turboprops are retired.
In partnership with South African Airways (Pty.), Ltd., a Rio de Janeiro to Johannesburg weekly roundtrip service begins on November 6.
On December 1, an arrangement is reached between the state carrier and Austral Airlines (Austral Lineas Aereas, S. A.) concerning the division and pooling of efforts on the domestic scene.
Again in cooperation with South African Airways (Pty.), Ltd., twice-monthly Rio de Janeiro to Cape Town service is begun on April 2, 1973. On May 6, nonstop flights begin to Miami. Claiming to be a member of the People’s Revolutionary Army, B. J. Mazor commandeers a B-737-287B with 74 passengers during a July 4 domestic flight, and orders it to fly to Havana, via Santiago de Chile, Lima, and Panama City. The little Boeing arrives home on July 7. The various stops are made not only for fuel, but to give the Argentine government opportunities (which it will not take) to meet the pirate’s demand that it provide $250,000 to Argentine medical agencies.
En route from Buenos Aires to Salta on October 20, a B-737-287B with 49 passengers is captured by four pirates, who divert it to Cuba, landing first at Yacuiba, Bolivia. Most of the passengers are allowed to deplane at Yacuiba and, after promise of free passage to Cuba, the hijackers free the rest and surrender on October 22.
When Juan Peron returns from exile, the carrier, in December, receives another new management team, with Juan Carlos Pellegrini as director general and Gen. Cesar Murelio Guasco as president. The workforce is now 7,136. Enplanements are up 2% to 1.35 million, but a net loss of $7.3 million is suffered.
The all-jet fleet achieved in 1974 includes 8 B-707-387Bs, 12 B-737-287Bs, 5 HS 748s, and 3 Fokker F.28-1000s. Orders are now placed for B-747-287Bs. A Jumbojet is leased from Pan American World Airways (1) and employed to inaugurate nine-flights-per-week New York to Buenos Aires roundtrip service in late spring, followed by a weekly frequency to Madrid introduced during the summer, as the longest nonstop scheduled service in the world. The total number of trips between New York and the Argentine capital increases from 16- to 19-per-week. Revenue passenger kilometers increase 35.3% and a $135,000 profit is posted.
In January 1975, orders are placed for two more B-747-287Bs and three more F.28-1000s replace the five HS-748s. Service is started to Caracas in April. A new marketing effort is undertaken, including the introduction of new aircraft livery and cabin interiors and hostess uniforms. Plans are made to introduce another Jumbojet, formerly flown by Delta Air Lines, and leased from Boeing.
Domestic and international flights are cancelled on September 1 because of a strike by flight and ground crews. The strike leads to cancellation of plans to charter the ex-Delta Air Lines B-747-132, which is sent to China Airlines, Ltd. instead.
Just after service is reintroduced, guerrillas hijack a B-737-287B on October 5 en route from Buenos Aires to Corrientes, and fly it first to Formosa, where the passengers are released. The little Boeing is then ordered to a remote airfield at Rafaela, hundreds of miles south of the capital, where the pirates escape.
An F.28-1000 with 4 crew and 56 passengers crashes while on final approach to Concordia on November 15; no fatalities are reported.
An ordered B-747-287B is placed into storage at Seattle for a year.
The workforce in 1976 is 8,219. One more F.28-1000 is placed in service and the first owned B-747-287B is delivered on December 16.
A total of 2,117,000 passengers are carried on the year and the number of freight FTKs flown is 94.61 million.
Jumbojet flights from Buenos Aires to Madrid, Rome, and Frankfurt start on January 5, 1977. A B-707-387B with 61 aboard, stalls at 200-feet just after takeoff from New York (JFK) on January 14; the jetliner is able to recover and does not crash. An additional B-747-287B is received later in the year as orders are placed for B-727-287s, the first of which enters revenue service in December.
Three B-727-287s are received in 1978 (the last in December) as bookings climb to 2,250,000. The fleet in 1979 includes 4 B-747-287Bs, 8 B-707-387B/Cs, 13 B-737-287Bs, and 4 B-727-287s plus 3 F.28-1000s. The three new Jumbojets enter service on January 13 and on October 11 and 26, respectively; one of these machines is the four hundredth Jumbojet delivered.
At New York (JFK) on May 11, flight dispatchers, clerical workers, and passenger service agents, all members of the Transport Workers Union of America, go out on strike. The job action continues until October 5, when it is settled by a mediated agreement.
Passenger boardings for the year jump 24.6% to 3 million.
The company’s 30th anniversary is celebrated in 1980. The fleet is increased by the addition of 1 F.28-4000 and 4 B-727-287s. While en route from Mar del Plata to Buenos Aires on June 30, a B-737-287B with 60 passengers is taken over by a lone gunman, who demands a ransom and a flight to Mexico. After the plane lands at its intended destination, the captain is able to talk the perpetrator into surrendering.
In September, a B-747SP-27 is acquired from Braniff International Airways. It is followed into service on November 18 by another B-747-287B.
On February 25, 1981, a B-707-387B with 58 passengers narrowly misses hitting one of the towers of the World Trade Center while flying 1,500 feet lower than its assigned altitude toward New York (JFK). Disaster is averted by a quick warning from ATC to the plane’s pilot, Capt. Jorge Fernandez.
B-707-387B charter flights across Antarctica from Buenos Aires to Auckland, N. Z. begin in April, followed by regularly scheduled Jumbojet service on September 6. At Auckland, Aerolineas Argentinas passengers are able to connect with Qantas Airways (Pty.), Ltd. flights to Sydney.
Having turned to avoid other traffic, an L-749A freighter with 3 crew and 2 passengers strikes the sea while on final approach to St. Thomas on October 26 (3 dead).
Another B-747-287B is, meanwhile, acquired on August 21 and bookings increase to 3.7 million.
Airline employment in 1982 is 9,835 and a seventh B-747-287B is delivered on January 23. Upon the outbreak of the Falklands/Malvinas Islands war in April, the services to New Zealand are suspended and Buenos Aires to London flights are cancelled.
Traffic begins a slide ending with a total for the year of 3,066,000 bookings. A total of 214.85 million FTKs are operated. Despite downturn, the sixth consecutive profitable year is recorded.
The workforce in 1983 is down by only thirteen. The carrier’s fortunes change radically as a result of the effects of the Malvinas conflict, indebtedness, runaway national inflation, and the world recession. In July, a Jumbojet is leased to The Flying Tiger Line. In December, Dr. Horacio Domingorena becomes chairman with Osvaldo Gimenez as general manager.
Passenger boardings rise 2.8% to 3,150,000 and 162.05 million FTKs are flown. The operating profit of the previous six years turns into a loss of $74 million.
The employee population is increased 4.9% in 1984 to 10,303 and routes are opened to Panama and Punta Arenas and Antofagasta (Chile). The B-727-287 Bogota route is extended to Miami and one B-747-287C is leased to The Flying Tiger Line. On the domestic scene, a second hub is opened 400 miles northwest of Buenos Aires at Cordoba.
A bomb is found aboard a B-747-287B on June 8, just hours before the former president, Isabel Martinez de Peron, is scheduled to board it in Buenos Aires for her return to Spain; Peron departs on a different aircraft. “Executive-Class” business-class service is introduced in August in the upper deck of its Jumbojets.
Passenger boardings jump 18% to 3,821,000. The operating profit is $1.6 million, but the net loss is $71.1 million.
The workforce is cut 0.3% in 1985 to 10,276. One B-707-387C is retired. Although cargo traffic is up 5.8% to 175.2 million FTKs, boardings dip 8.1% to 3,512,000. Revenues jump 32.8% to $540.7 million and expenses 37.6% to $558 million; the losses are $17.2 million (operating) and $9.7 million (net).
A B-707-387C freighter with 4 crew and 1 passenger, overruns the runway while landing at Buenos Aires on January 27, 1986, and collides with a hill 200 m. beyond it; there are no fatalities.
Ground handling joint ventures are signed with PLUNA (Primera Uruguayas de Navegacion Aerea, S. A.) and VARIG Brazilian Airlines (Viacao Aerea Rio-Grandeuse, S. A.) in early spring; the former calls for joint operations on the Montevideo-Buenos Aires shuttle.
The carrier suffers a difficult 26-day pilot strike in midyear and, consequently, enplanements slide to 3,391,070. For the year, airline-related activities lose $126 million, despite $85 million in government subsidies.
Airline employment in 1987 stands at 10,323. Weekly B-747-287B Buenos Aires to Auckland, N. Z. transpolar flights are resumed on July 18 and, during the fall, two short pilot strikes, totaling 36 hours, advertise a demand for higher wages.
In December, an agreement is signed with the government to reduce the airline’s operational shortfall by 50%. International services to Montreal, Panama, and Amsterdam are cancelled.
Passenger boardings for the year climb 13.1% to 3,902,266. On revenues of $600 million, a total of $9 million is lost.
Airline employment is increased a slight 0.9% in 1988 to 10,372 and the fleet now includes 1 B-707-387C, 12 B-737s, 7 B-727s, 1 B-747SP-27, 1 F.28-4000, and 3 F.28-1000s. As part of its attempt to play a larger role in the world air transport business, SAS (Scandinavian Airlines System) makes an effort in March-April to acquire 49% shareholding in the Argentine flag carrier.
As part of the “pre-contract,” the Stockholm-based major and Aero-lineas Argentinas agree to conduct a feasibility study while awaiting the approval of the government. In exchange for assuming the airline’s debt, Argentina would immediately receive cash for 20% interest, with an option to purchase up to 36% more within three years. SAS would receive seats on the board of directors and, under contract, provide general administrative and operational support.
After landing at Ushuaia following a September 26 service from Rio Grande, a B-737-287 with 6 crew and 56 passengers veers off the runway, ripping off its engines and collapsing its landing gear before sliding down a slope into water 2 m. deep. Although the aircraft is damaged beyond repair, there are no fatalities.
It is announced, also in September, that, since 1986, the company has lost $1 million to an employee theft ring that has sold B-727/737 spare parts.
In December, President Eduardo Gonzalez del Solar opens talks with Alitalia, S. p.A. concerning the possibility of the Italian flag carrier joining the bid of SAS (Scandinavian Airlines System) to acquire shareholding; simultaneously, the government submits the Scandinavian proposal to the Argentine congress for approval. Customer bookings decline 4.1% to 3,705,713; however, cargo moves ahead by 2.2% to 185.7 million FTKs.
Company employment is level in 1989. The partnership initiative with the Scandinavians will be derailed by Argentine political events in January; rather than suffer a legislative defeat, the government, in the person of Public Works Minister Rodolfo Terrango, cancels the proposed arrangement.
During the summer, the company begins to significantly increase the amount of third party maintenance work it undertakes for foreign airlines. In August, a second weekly frequency is started from Buenos Aires to New York. The Auckland service is extended to Sydney in September; on return from Australia, the flight path is direct to Buenos Aires.
Later in the month, an operating/marketing and cooperative agreement is signed with VARIG Brazilian Airlines (Viacao Aerea Rio-Grandeuse, S. A.). Under terms of the pact, the two promise to avoid fare wars, offer to expand the earlier agreement covering each others’ ground handling needs in their countries, and to undertake joint flight-service training and market-development activities.
Beginning December 8, the carrier offers six weekly departures each from New York and Miami to Buenos Aires, along with four weekly flights from Los Angeles. The polar service is doubled to two weekly flights as of December 12. The amount of third party maintenance work completed this year increases 26% to $13.2 million. Among the airline’s customers are Air France, S. A.; Austral Airlines (Austral Lineas Aereas, S. A.); Eastern Air Lines, Ecuatoriana Airlines, S. A.; Swissair, A. G.; KLM (Royal Dutch Airlines, N. V.); and Pluna (Primera Uruguayas de Navegacion Aerea, S. A.).
Passenger boardings fall another 2.8% to 3,603,401. Freight climbs again, by 7.1%, to 198.89 million FTKs. Revenues total $719 million.
The number of employees is increased by 3.4% in 1990 to 10,726 and the fleet now includes 34 aircraft.
An F.28-4000 with 5 crew and 85 passengers lands fast on a slick runway at Villa Gesell on January 5 after a service from Buenos Aires; the jetliner overruns the runway by 90 m, ending up in a muddy field. In the process, the nosegear collapses and a part of the wing, together with the right main landing gear, is sheared off; the plane catches fire and is burnt out. No fatalities are reported.
The company’s only B-747SP-27 is sold to Air Mauritius, S. A. in January and regains the B-747-287C out on lease to The Flying Tiger Line.
Plans are made in February for partial privatization and a valuation of assets is set at $623 million, of which 85% will be sold to private investors, 10% to employees, and 5% will be retained. Scheduled service to London is also resumed during the month; as Argentina and the U. K. still do not have diplomatic relations, the twice-weekly roundtrips are operated under temporary agreements.
On April 30, the company begins receiving privatization bids, promising to name a winner on June 28. In May-June, the country’s economic condition forces the company to slash fares on some routes as much as 50%. During the latter month, the Mexican government grants the carrier fifth freedom rights between Lima and Mexico City on its current service from Buenos Aires to Los Angeles and removes equipment and capacity restrictions.
The equity announcement is, however, delayed for two weeks on July 1 as two of the four bidders request additional time to better prepare and present their offers. At this point, groups led by American Airlines, Alitalia, S. p.A., and KLM (Royal Dutch Airlines, N. V.) withdraw, claiming insufficient time to complete their bids. Just before the winning bid is announced, a federal judge upholds a challenge to the privatization that appears to derail the process; however, the Argentine Supreme Court rules that the sale can go through.
The government agrees on July 19 to sell majority 85% shareholding to a consortium headed by the Spanish airline Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) for an estimated $260 million in cash and $2.01 billion in debt paper; a down payment of $220 million is required. The government retains a 5% interest, 10% are sold to employees, and the other partners are local Argentine businessmen and Cie-los del Sur, the holding company that oversees Austral Airlines (Austral Lineas Aereas, S. A.). As work begins on the transfer, there are significant changes in the owner’s share participation.
First, Credit Suisse pulls out of its pledge to lend the partners $54 million, reportedly because terms of the loan are not met. Consequently, Cielos del Sur is forced to contribute six of its jetliners as collateral in that amount. Control of the financially distressed state carrier is allowed to pass to the Iberian group on November 22.
Amadeo Rivas, an official of Cielos del Sur, is named president, with Aviacion y Comercio, S. A. (Aviaco) President Manuel Esteve as executive vice president/CEO. Also in November, a comprehensive marketing agreement and joint frequent flyer plan is established with Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.).
Customer bookings continue to decline throughout the year, falling 8.2% to 3,306,919, while cargo drops 1.8% to 195.32 million FTKs.
The fleet in 1991 includes 1 each B-707-387B and B-707-321C, 7 B-727-287As, 1 B-727-2M7A, 4 B-737-287s, 5 B-737-287As, 6 B-747-283B/Cs, 1 leased B-747-283B/C, and 3 Fokker F.28-1000s. Orders are placed for 4, later 6, McDonnell Douglas MD-88s. The Spanish-led coalition is unable to pay $260 million in cash and $2 billion in foreign-debt paper due in February, having so far retired only 60% of the required foreign debt and put forward no cash. Iberia works throughout the first and second quarters to secure funding to support the takeover.
By May, the carrier has increased its shareholding to 30% by paying the government $142.5 million in foreign debt title in addition to the funds paid the previous year. In addition, the Spanish group pledges to retire $800 million in debt title in May and another $800 in June; in return for which, the Argentines agree to also turn over 70% majority interest in the domestic carrier Austral Airlines (Austral Lineas Aereas, S. A.).
A joint strategic plan for the two Argentine airlines is designed during the summer. By fall, the shareholders are Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) (30%), Spanish banks (19%), Argentina (43%), and private Argentine investors (8%). Through June, en-planements total 1,389,662. A new arrangement is reached with the Iberian group in August; the formula calls for a reduction in the amount of foreign debt that the Spanish must retire; however, $171 million is added to AA’s balance sheet. The particulars are completed in September.
The employee population in 1992 stands at 7,000 as the first four MD-88s and a leased MD-83 are delivered and the B-707-321C is withdrawn.
A B-747-287B with 336 aboard, comes into Los Angeles on February 20 from Buenos Aires, via Lima, Peru. After arriving, it is found that 65 aboard have cholera, possibly contracted in Peru where it is rampant. One passenger dies and three must be hospitalized as a result of the disease. Accusations as to cause between Argentina and Peru result in the carrier’s halting service to Lima between March and May.
During the spring, maintenance problems lead to widespread delays. Statistics are released for the first six months and show passenger boardings up 25.7% to 1,870,339. Freight during the same period declines 14.7% to 80.92 million FTKs.
A major new problem erupts in July when the government and company employees refuse to sign off on the first financial statement presented by Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.). Argentine legislators charge the group with asset stripping, bad management, and fraud, leading police to raid the airline’s headquarters in search of incriminating evidence. In an effort to end the controversy, a new shareholding agreement (effective October 1) is signed in August between the Argentine government and the Iberian-led consortium; it includes the reinstatement of 775 redundant employees. The privatization is the first in Argentine history.
While taking off from San Luis on a November 20 service to Cordoba, a tire on the right main landing gear of a B-737-287C with 6 crew and 107 passengers explodes. The pilot elects to abort, but cannot control the aircraft, which runs off the right side of the runway, careens into a ditch, and catches fire. All aboard are safely evacuated; however, the Boeing is burnt out.
Effective by December, the Iberian arrangement calls for the government to increase its shareholding from 5% to 33% by purchasing 28% of the stake held by private Argentine investors.
Widespread industrial disputes occur during December. Pilots refuse to takeoff on several occasions, claiming that proper maintenance has not been performed on their aircraft. Domestic and international flights are both affected.
Revenues for the year as a whole total $919.2 million, but expenses are more and cause losses: $33.3 million (operating) and $190.4 million (net). The political furor caused by the losses continues.
In 1993, President Riva oversees a workforce of 7,000 and a fleet that includes 1 B-707-387B, 7 B-727-287As, 1 B-727-2M7A, 4 B-737-287s, 5 B-737-287As, 1 B-737-387C, 6 B-747-287Bs, 3 F.28-1000s, and 1 MD-83, which is leased to Austral Airlines (Austral Lineas Aereas, S. A.). Three of the Boeing tri-motors are leased from Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.).
International routes visited from Buenos Aires include: Madrid, Rome, Zurich, Frankfurt, Paris, London, Los Angeles, Mexico City, Miami, New York, Montreal, Toronto, Rio de Janeiro, Sao Paulo, Montevideo, Caracas, Lima, Santiago, Guayaquil, Bogota, Porto Alegre, Flori-anopolis, Punta del Este, Auckland, and Sydney. A full network of unprofitable domestic routes is maintained, but consideration is given to dropping the Miami hub. A code-sharing and freight cooperation pact is initialed with LADECO Chilean Airlines, S. A. covering the Santiago-Buenos Aires-Miami route.
After leading the company through the troubled Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) takeover, President Riva resigns in May; he is succeeded by local citizen and Iberian appointee Manuel Moran. The Spanish flag carrier also seconds marketing, finance, commercial, and maintenance directors to the company and assists Aerolineas Argentinas to join the Amadeus computer reservation system (CRS). A new strategic plan is developed with special attention paid to route rationalization.
During the summer, the fleet is increased by the addition of 6 MD-88s and 1 B-747-2L5B leased from VARIG Brazilian Airlines (Viacao Aerea Rio Grandense, S. A.). In October, VIASA (Venezuelan International Airways, S. A.) becomes the carrier’s exclusive general sales agent in Colombia. During the same month, the company completes a $172-million public offering of 5.21% certificates of participation in its 12-year notes; the sale, guaranteed by the U. S. Export-Import Bank, will be applied to the purchase of new aircraft.
Customer bookings through November are off another 10.9% to 3,056,908, but cargo climbs 8.6% to 159.7 million FTKs. Late in the month, the government rejects an Iberian request for a contribution of $215 million to a $500-million capital pool it is assembling for the rein-vigoration of the carrier.
Airline employment is boosted 27.1% in 1994 to 8,900, with a total of 38 Iberian managers now working at Aerolineas Argentinas headquarters. Early in January, the Argentine government is approached by Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.), which seeks a contribution for a $500 capital injection planned for the revitalization of the airline. Argentine leaders refuse the request, specifying in February that it will, however, allow private and foreign investors to acquire a majority stake in the carrier without altering its flag-carrier status.
The Spanish flag carrier reaches an apparent agreement with Argentina and the Spanish banks in early March, under which the foreign partners unilaterally begin to inject the $500 million in capital and increase their shareholding to 85%. Further, state-owned capital would be transferred as payment for a $700-million debt Aerolineas Argentinas owes Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.). At the same time, a comprehensive marketing alliance is signed and a joint frequent flyer plan is developed.
Unhappily, the pact appears to unravel when the government grants domestic trunk-route rights to small local carriers, hedging on legal and political guarantees that the state carrier would retain its flag carrier status. Even though the Argentine pilots’ union makes a $110-million pledge to acquire the government’s 28% stake, the Madrid-based major rejects the agreement. Meanwhile, VIASA (Venezuelan International Airways, S. A.) begins to code-share with the company on the route from Buenos Aires to Caracas.
The company begins to drop the most unprofitable of its local services while arrangements are made with Delta Air Lines in the spring to acquire three A310-324s for use on routes to the U. S. The off-again, on-again arrangement with Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) is on again twice in April. A lower court challenge to the first renewed agreement is overturned by a higher court. The second time accord is reached, the deal is enhanced by the abolition, at the request of the Spaniards, of the Argentine Air Force’s profitable monopoly on ground-handling at the country’s airports.
Traffic is reported through June and shows passenger boardings up 24% to 1,964,695, while freight is ahead by 26.9% to 103.01 million FTKs.
Overhauled by Air France at its facility at Paris (ORY), the first A310-324 is delivered in August. In September, Argentina and the U. S. sign a memorandum of consultation ending a capacity and traffic rights disagreement. Under its terms, the company is granted rights into San Juan.
During the month, it also begins flying its A310-324s from nonstop Buenos Aires’ Ezeiza Airport to New York (JFK). The 5,000 nm. service is the longest flown by any carrier operating the A310.
In February 1995, a block-space arrangement is reached with Malaysia Airlines (MAS) covering flights from Buenos Aires to Kuala Lumpur, Johannesburg, and Cape Town. Enplanements through May total 1,628,598.
In a further effort to win European Union approval for a state bailout, Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) announces, during the last week of November, that it is planning to sell its entire 83% stake in Aerolineas Argentinas. It is hoped that most of the company would be sold to a consortium of American banks; however, any sale would have no effect on the operating and marketing alliances in place between the two national carriers.
In December, twice-weekly, block-seat, code-sharing flights begin with Ansett Australia (Pty.), Ltd. on the Australian carrier’s trans-Tasman service from Sydney to Auckland aboard an Ansett B-747-377; the flights are planned to connect with the Argentine major’s flights to and from Buenos Aires.
The workforce stands at 7,000 in 1996. A contract is entered into with AV Atlantic in March. The Argentine major establishes a small hub at Miami (MIA) and the U. S. carrier agrees to base there a B-727-23, painted in modified Aerolineas Argentinas colors, to provide alternate-day connecting flights to New York (JFK), Montreal (YUL), Toronto, Mexico City, Punta Cana, and St. Martin. Flights commence on April 15.
Again, figures are reported for the first five months; during this period, the company’s 33 aircraft transport a total of 1,732,551, a 6% increase. Cargo declines 3% as 74.62 million FTKs are operated.
On July 1, a code-sharing agreement is signed with National Airlines, S. A. of Chile. Under the pact, passengers will be able to cross the two airlines’ networks on one ticket and with just one check-in. Additionally, the companies will jointly promote products and services, institute tariff agreements, cooperate in aircraft maintenance, and begin common catering services.
Later in the year, the company agrees to code-share with TAM-Mercosur (Transportes Aereos del Mercosur, S. A.) on TAM’s daily Buenos Aires-Asuncion services; 50% of the seats on every flight are reserved for AA.
Revenues this year reach $1.03 billion, but costs climb to $1.09 billion. There is an operating loss of $63.9 million and a net downturn of $66 million.
The employee population is reduced by 25.9% in 1997 to 5,184. Electronic ticketing is introduced in January in a number of markets served from Buenos Aires. Early in the year, a code-sharing agreement is signed with Aeroflot Russian International Airlines (ARIA) covering flights from Buenos Aires to Moscow to Buenos Aires.
Andes Holding, S. A., the parent of Austral Airlines, S. A. and Aerolineas Argentinas, which is held by Bankers Trust, Teneo, and Merrill Lynch, announces in February that it will consider offering for sale its total shareholding in both airlines (an 89% stake in the former and a 63.5% stake in the latter). Although no official announcement is made, VASP Brazilian Airlines (Viacao Aerea Sao Paulo, S. A.) quietly places a $300-million bid.
EU Joint Aviation Authority is received on March 11 to repair at Ezeiza Airport in Argentina the engines and components of European flag airlines. Aerolineas Argentinas becomes the first Latin American based company to provide such services.
A wide-ranging, new strategic partnership between Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) and American Airlines is tentatively concluded at the end of July. Under its terms, AMR Corp. would acquire a 10% stake in Iberia’s owner, SEPI, which also controls Aerolineas Argentinas and Austral, S. A. and Andes Holdings, which owns Interinvest, the holding company for the two Argentine airlines. It will also lead an effort to find additional investors who will purchase up to 35% additional Interinvest shareholding from Andes. In addition, Iberia and American will begin to share codes on flights from Spain to the U. S. and link their frequent flyer programs.
In South America, American Airlines establishes reciprocal frequent flyer arrangements with both Aerolineas Argentinas and Austral, S. A. and code-shares on certain of their internal routes. Meanwhile, the U. S. major’s almost-partner British Airways, Ltd. (2) and Iberia discuss a 10% equity stake for the U. K. flag carrier as well as a strategic partnership with the usual frequent-flyer program linkage and code-sharing on routes between Madrid and London.
Significant opposition quickly materializes from Continental Airlines and United Airlines, which fear not only an AA-BA linkup, but also the potential domination of Latin American routes by the Dallas-based megacarrier.
“Latin Liberation,” an article by John Waggoner, in the online edition of Air Cargo World, reports that, in September, the cargo of a company freighter is seized at Ezeiza Airport in Buenos Aires. In something of a mistake, the 85-ton cargo of rifle parts, though legally exported, are pulled over because they are en route from Brazil to Venezuela, via Argentina—a mysterious roundabout trip. They mystery is soon resolved; Aerolineas Argentinas, having won the freight contract over VARIG Brazilian Airlines (Viacao Aerea Rio-Grandeuse, S. A.), has elected to make a stop in Argentina. Customs officials, however, had not forgotten a similar triangular shipment made the previous year through Venezuela to Equador, which was illegal.
Electronic ticketing is further promoted during the fall and is advertised by a B-737-287 that wears the phone number for the service in billboardsized titles on both sides of its fuselage.
On October 15, ATC in Bariloche mistakenly and simultaneously authorizes a company B-737-287A to land while a USAF C-5 Galaxy, carrying equipment and personnel in support of President Clinton’s visit, is taking off. The two jets come within 1,600 feet of colliding.
On November 4, the cargo division of Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.) deploys four extra freighters to the Netherlands, boosting its total to ten, from Madrid in an effort to defeat the road blockade established by French truckers at the borders. In a normal week, Iberia operates six freighter flights from Madrid to Maastricht Aachen Airport. Two of these are operated by Aerolineas Argentinas and are routed, via Madrid, on to Buenos Aires.
Also in November, the unprofitable Buenos Aires to Los Angeles return service is suspended for 180 days. Aerolineas Argentinas places increased emphasis on its flights to Miami and New York, where its passengers can connect with new partner American Airlines. In December, AMR, the parent of American Airlines, executes the formal agreements with SEPI and Andes Holdings, subject to approval by the U. S. Justice Department.
Passenger boardings for the year slide 2.4% to 793,000, while cargo climbs 18.4% to 103.77 million FTKs. Revenues total $998.2 million, but expenses are $1 billion; consequently, there is an operating loss of $5.8 million, which is still an improvement on the previous year. Additionally, a small $2.8-million net profit is earned.
At the beginning of 1998, the fleet includes 32 aircraft, of which 50% are Stage III certified; this number includes 16 B-737, 7 B-747-200s, 2 A310s, and 7 MD-80s.
In January, AMR Corporation, parent of American Airlines, signs a final agreement to purchase 8.5% of the Argentine flag line through a 10% buy-in to the holding company Interinvest.
During the first quarter, two B-747-287Bs receive special World Cup decals and the slogan “Aerolineas, Mas Argentina Que Nunca” (Aerlin-eas, More Argentina Than Ever) printed along the fuselage cheatline.
The company in April negotiates a wide-ranging strategic alliance with Qantas Airways (Pty.), Ltd. The pact will include dual-designator flights from South America to Australia.
A new five-year business plan, dependent upon the American Airlines stockholding, is unveiled in June. It includes a $2-billion investment in regional jets and an increase in the number of nonstop frequencies to Europe.
The U. S. Department of Justice (DOJ) clears the AMR investment in Andes Holding on July 8. The flight schedule is altered, also at the beginning of the month, to include new international services. Daily nonstop B-747-287B roundtrips are launched from Buenos Aires to New York. Four weekly direct A310-324 return flights are started from Buenos Aires to Caracas, while three to Caracas, via Bogota, are also launched.
Four-times-a-week roundtrips are resumed from Buenos Aires to Mexico City, while the schedule to Madrid now includes daily service from Buenos Aires, via San Pablo, plus four weekly nonstops to the Spanish capital.
On September 24, it is reported that a shareholder vote to confirm the new ownership structure has been postponed “for administrative reasons” until October 24. At that point, the arrangement receives assent.
AMR completes its purchase of a 10% stake in Interinvest on November 3 and thereby gains 8.5% ownership of Aerolineas Argentinas and 9% of its regional affiliate Austral Airlines, S. A. Although U. S. DOJ regulators rule that neither American Airlines nor its parent may take any direct control over either carrier, that matter is mooted when Aerolineas Argentinas appoints its new management team.
American’s former managing director for Argentina, Diego J. Cousino, becomes CEO, with its former managing director of international planning, C. David Cush, as COO. The two quickly replace most of the carrier’s senior management, which had been put in place by Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.).
A $120-million, ten-year contract for its information technology functions is signed by the airline on November 17 with the SABRE Group. The contract also calls for he SABRE group to provide specialized information technology services to Austral Airlines, S. A.
Just before Christmas, an order is placed for 12 Airbus A340s, including six A340-600s for delivery beginning in 2002. Plans are announced for the retirement of the airline’s B-747-287Bs over the next four years. A new business plan is unveiled, which will allow Aerolineas Argentinas to fly new routes to Europe, Australia and New Zealand, and provide additional domestic service in the Mercosur region with regional jets.
Passenger boardings during the 12 months drop 2.6% to 4.11 million. On the plus side, freight traffic accelerates 12% to 215.56 million FTKs.
By the beginning of 1999, airline employment has been reduced by 5.2% to 4,913. An MD-88 is damaged beyond repair in a Buenos Aires hangar fire on February 24.
Taking a leaf from the commuter airline book of its U. S. partner, Aerolineas Argentinas sets up its own regional affiliate on March 15. Employing British Aerospace BAe Jetstream 32EPs, the new AeroVIP, S. A. launches Aerolineas Argentina Express flights from Cordoba.
La Nacion reports on April 21 that the carrier has completed a $1.7-billion investment in the lease of the 12 A340s and that it has contracted with CTO-Auckland to relaunch the company logo. The Spanish government holding company SEPI (Sociedad Estatal de Participanciones Industriales) continues to seek buyers for the 80% stake in the Interinvest concern Andes Holdings. Airline officials await the $200-million capital injection slated for June, while making plans to phase down the Austral Airlines, S. A. tradename to internal flights.
Xavier de Irala, of Iberia Spanish Airlines (2) (Lineas Aereas de Espana, S. A.), informs reporters during a May 7 news conference that his company has no objection to the possibility that LanChile Airlines (Linea Aerea Nacioanl Chile, S. A.) may purchase a stake in Aerolin-eas Argentinas or that American Airlines may seek to increase its shareholding. Indeed, conversations are underway to determine if collaboration with the Chilean line in this regard might be arranged.
COO Cush reviews future plans in the May 12 issue of Flight International. The company will complete a $200-million recapitalization by the end of the month in order that its parent, Interinvest, can be sold off in June and that Aerolineas Argentinas might merge with its sister, Austral Airlines, S. A. in July. There are, apparently, some problems in coming together with the second part of the package and so the amalgamation of the two carriers will be delayed from 60 to 90 days.
On May 19, the Argentine government postpones August talks with the U. S. on a new aviation trade agreement in order to accommodate the schedules of its officials involved. The move disappoints the U. S. Department of State, which lets it be known that the code-sharing pact between Aerolineas Argentinas and American Airlines will not be approved without a new liberal aviation agreement.
A pair of leased ex-Philippine Airlines (PAL) A340-313s arrive in early June, making Aerolineas Argentinas the first Latin operator of the long-range type. Under terms of a three-way code-sharing agreement signed with Aerolineas and VARIG Brazilian Airlines (Viacao Aerea Rio-Grandeuse, S. A.), South African Airways (Pty.), Ltd. introduces twice-weekly nonstop roundtrips on July 8 between Johannesburg and Sao Paulo. Also in July, four former Philippine Airlines A340-242s are chartered from Airbus Industrie.
A new phased “Open Skies” agreement is signed by Argentina and the U. S. in September. It is clearly noted by the Argentine government that, for it to take effect on schedule a year hence, American Airlines, per its original investment agreement, must successfully restructure its 10% ownership of the flag carrier by December 31. No new owners have been found by year’s end and ownership remains unchanged. On other matters of reorganization, AA, despite improvements in systems and fleet and the absorption of Austral Lineas Aereas, S. A., has also largely struck out. The concerned new government of Pres. Fernando de la Rua takes office in December.
Overall, passenger boardings during the 12 months fall 5.1% to
3,979,000 and freight plunges 11.2% to 214,433,000 FTKs. It will be reported that the carrier has lost $125 million net on a $1 billion turnover. The company debt now stands at $874 million.
The thrice-weekly A340-242 roundtrip service between Buenos Aires and Rome is doubled to six weekly return flights on January 2, 2000.
As the result of the failure to locate new investors, SEPI, the Spanish holding company, agrees in February to take over total management of Aerolineas and to continue its funding via the subsidiary Interinvest. Aerolineas arranges to implement a SEPI-created rescue and restructuring plan. Although AMR, like Iberia, will retain its 10% stake, David Cush, the executive seconded to Aerolineas as COO, is replaced by an Argentinian and is now recalled to American Airlines, where he becomes VP-int’l planning and alliances.
New Infrastructure Minister Nicolas Gallo announces on February 3 that Argentina will delay implementation of the “Open Skies” pact with the U. S. unless capital restructuring of Aerolineas has been completed. In March-April, the Argentine pilots’ union APLA undertakes negotiations with the Inter American Development Plan on its own efforts to secure sufficient funding for a 51% buyout. The organization, meanwhile, voices its strong opposition to any implementation of the “Open Skies” agreement.
On May 15, the Argentine Transport Ministry confirms that 32 company aircraft have been grounded by the courts over unpaid tax bills.
Drafts of the SEPI restructuring plan circulate in Argentina during late May and early June. The document envisions an airline of six divisions controlled by a new holding company, Grupo Aereo Argentino.
Additionally, an RIF of 20%-25% (1,500 jobs) through early and incentive retirements will be required plus 20% wage cuts and a $650 million injection of new capital: $240.8 from SEPI, $32.5 million from the Argentine government, $65.3 million from company employees, $55.2 million from American Airlines, and $256.2 million from Merrill Lynch and Bankers Trust.
These measures are widely attacked as “unfair” by the nation’s president, Fernando de la Rua, other members of his government, and numerous unions (including all seven of the airline groups), who also fault Iberia Spanish Airlines (2): Lineas Aereas de Espansa, S. A. for earlier alleged mismanagement contributing to the company’s $900 million debt. SEPI warns on June 26 that, unless the plan is approved, the airline will be bankrupt in a month.
Daily flights between Buenos Aires and Bogota are suspended on July 1.
Despite the spat of negativity, company shareholders approve the SEPI plan at the end of July. Unions, if not pacified, are victorious at the political level when the national Congress legislates a seat for them on the airline’s board of directors.
SEPI agrees on July 31 to loan Aerolineas $208.5 million to keep it afloat until the airline’s stockholders can meet on September 15.
Employing an A340-242, the company inaugurates new thrice weekly roundtrips on September 2 between Buenos Aires and Los Angeles, via Lima.
Still attempting to save jobs and avoid paycuts, members of the Association of Technical Aeronautical Personnel offer to purchase the airline on September 5.
On October 13, SEPI and the government of Argentina reach an accord on future financing for the carrier and its Austral Lineas Aereas, S. A. subsidiary. The Spanish holding company agrees to invest another $650 million while Argentine authorities pledge to provide whatever amount is required to maintain the nation’s 5% stake. On the other hand, significant additional cost-cutting remains to be implemented and three of the carriers’ six employee unions, fearing job cuts/salary reductions, are already on record as being against the terms of this bailout.
AEROLINEAS ARGENTINAS EXPRESS. See AEROVIP, S. A.
AEROLINEAS BONANZA, S. A. de C. V. See AEROVIAS CARIBE, S. A. de C. V.
AEROLINEAS CARGUERAS, S. A.: Aeropuerto Eldorado, En-trada Catam Int 26, Bogota, Colombia; Phone 57 (1) 413-5007; Fax 57 (1) 413-5183; Code VS; Year Founded 1995. Aerovias Especiales de Carga, S. A. is renamed in 1995; however, its business continues as before. Under the direction of General Manager Juan C. Ospina, the workforce grows to 20 and the fleet comprises 2 Boeing 727Fs and 1 Convair CV-580.
In 1998-2000, the company undertakes scheduled and ad hoc cargo charters to points around the globe, including Athens, Boston, Hong Kong, Johannesburg, London (LHR and LGW), Los Angeles, Manchester (England), Miami, New York (JFK), Newark (EWR), Orlando, San Francisco, Tokyo, and Washington, D. C. (IAD).
AEROLINEAS CARRERAS TRANSPORTES AEREOS, S. A.: Argentina (1959-1968). Buenos Aires-based Aerolineas Carreras is established by Jose M. Carreras in 1959 to offer nonscheduled, allcargo services, initially with a single Curtiss C-46 Commando. During the next five years, the fleet is increased by the addition of four more Commandos.
In the fall of 1963, the company is awarded a foreign air operator’s certificate by the U. S. CAB and acquires a Lockheed L-749A Constellation. Beginning in July 1964, the Connie begins scheduled flights to Miami and these are maintained until the four-engine transport is impounded at Montevideo, Uruguay, in April 1967. Curtiss cargo services are maintained until Carreras goes out of business the following year.
AEROLINEAS CENTRALES DE COLOMBIA, S. A. See ACES COLOMBIA (AEROLINEAS CENTRALES DE COLOMBIA, S. A.)
AEROLINEAS CONDOR, S. A.: Ecuador (1978-1985). This third-level carrier is formed at Simon Bolivar Aiport at Guayaquil on January 3, 1978. A year is spent in obtaining sufficient backing and choosing a fleet, which comes to comprise 1 Fokker F.27, 1 Cessna 402, and 1 Cessna 337. Regularly scheduled services are inaugurated on March 12, 1979, linking Guayaquil and Ambato with Loja and also with Quito and Tulcan in the north.
In 1981, a de Havilland Canada DHC-4 Caribou is acquired for contract freight services. Increased fuel prices and the world economic recession when combined with competition by other Ecuadorian airlines leads to several years of economic losses for the carrier; as a result, it is forced to shut down in 1985.
World History
