Aerolíneas Argentinas S.A., Argentina’s state-run flagship airline, has recently announced a significant restructuring.
This move involves reducing its directorates by 43%, from 14 to 8, and its direct reports from 17 to 11, as of December 2023.
Spearheaded by Infrastructure Minister Guillermo Ferraro, this “rationalization plan” is a response to the recent appointment of Fabián Lombardo as the new manager, taking over from Pablo Ceriani.
This restructuring follows the government’s decision to embrace an open skies policy. Outlined in DNU 70/2023 and explore the potential sale of Aerolíneas Argentinas.
The ongoing discussions in the Chamber of Deputies include a proposal to privatize state-owned enterprises, including this airline.
Attorney General Rodolfo Barra clarified that this proposal is not a mandate but an authorization, leaving the decision to privatize at the President’s discretion.
Financially, Aerolíneas Argentinas has shown a declining debt trend, with its commercial and financial debt dropping to just over $600 million as of June 2023, down from $1 billion in 2019.
The National State’s contributions to the airline have been substantial, totaling approximately $8 billion between 2008 and June 2023.
These contributions peaked in 2012, with a subsequent gradual decrease until a rise in 2019.
Workforce of Aerolíneas Argentinas increased to 11,899
Followed by a decrease to $353 million in 2022 and $30 million by June 2023.
The airline’s net equity as of June 2023 was nearly $200 million despite improvements in 2016 and 2017.
Pre-tax profit results have been negative since the state expropriated the Aerolíneas Argentinas Group in 2008, with a recovery in recent years.
According to the National Institute of Census and Statistics (INDEC), the workforce of Aerolíneas Argentinas increased to 11,899 employees by December 2023.
This rise in employment comes despite a hiring freeze implemented by the former Economy Minister Sergio Massa in August 2022 for state companies and entities.
In summary, Aerolíneas Argentinas is undergoing significant changes in its structure and operations.
Reflecting the evolving landscape of the aviation industry and the Argentine government’s policy shifts.
These changes are aimed at improving efficiency and financial stability amidst considerations of privatization and adapting to new market realities.