Aerolíneas Argentinas Posts First Operational Profit in 16 Years Amid Privatization Push

Aerolíneas Argentinas, the state-owned airline, announced its first operational profit since 2008, closing 2024 with a $20.2 million surplus.

Company president Fabián Lombardo shared the news during a shareholder meeting, marking a significant financial turnaround for the airline. For 16 years, Aerolíneas Argentinas reported an average annual EBITDA loss of $400 million.

The airline relied heavily on government subsidies to sustain operations. The company’s improved financial performance follows aggressive cost-cutting measures implemented in recent years.

Aerolíneas reduced its workforce by over 13%, eliminating more than 1,600 positions and cutting 85 hierarchical roles. These included eight directorships, 20 management positions, and 57 other roles.

Lombardo emphasized that these changes aligned the airline with industry standards and prepared it for potential privatization under President Javier Milei’s administration.

Aerolíneas Argentinas’ Path to Financial Independence

Despite the positive results in 2024, Aerolíneas closed 2023 with a $220 million operational loss. However, Lombardo projected that the airline would operate without Treasury funding in 2025 for the first time since its re-nationalization.

He stated that Aerolíneas’ self-sufficiency would allow shareholders to explore future options without financial constraints. The Argentine government has spent approximately $8 billion subsidizing Aerolíneas Argentinas since taking control of it in 2008.

Critics argue this funding diverted resources from urgent social needs in a country grappling with poverty and fiscal deficits. The Milei administration views privatization as a solution to reduce state spending and improve efficiency in the airline’s operations.

Lombardo expressed optimism about the airline’s future prospects, citing its improved financial health as a key factor for attracting investors. He noted that the company’s efforts in 2024 focused on enhancing its market appeal and positioning it as a competitive asset.

Aerolíneas has also expanded its route network and passenger services, contributing to its revenue growth. The announcement signals a turning point for Aerolíneas Argentinas as it transitions toward operating independently of public funds.

The move aligns with broader economic reforms aimed at reducing Argentina’s fiscal burden while addressing long-standing inefficiencies in state-run enterprises.