MercoPress. South Atlantic News Agency

Nationalized Aerolíneas Argentinas remains deep in the red

CEO Recalde anticipates a rebound in revenue when the global airlines crisis is over.

Argentina’s re-nationalized flag air carrier Aerolíneas Argentina lost in July 48 million US dollars which is “a little bit more” than the same month a year ago when the company belonged to the Spanish tourism group Marsans, according to the company’s current CEO Mariano Recalde.

However Recalde attributed the greater losses to the economic crisis and argued that the issue was not in the costs but in the revenue.

“In June 2008 revenue was 90 million US dollars and this year 50 million USD”, said Recalde adding that “June and July are the worst months for airlines in the southern hemisphere”, plus the fact that this year “we had a dramatic drop in winter tourism because of the A/H1N1 virus flu”.

The July loss “just above 48 million USD” and an average red of “33 million USD” admitted by CEO Recalde, with average revenue of 50 million USD in June, are indicating that income is only covering between 50 and 60% of costs.

Nevertheless Recalde insisted in his optimism in the future of the company since “under government management all indicators of Aerolíneas have improved significantly”. He added that when the crisis “which is hitting all airlines of the world is over, revenue is going to increase considerably”.

Furthermore Recalde pointed out “if we also take into account that we have a plan to restructure the company and we are already in the process of renewing the fleet, Aerolíneas is certainly going to become a far more viable air carrier”.

He did however not go as far as to anticipate Aerolíneas could become profitable in spite of all the advances and reforms announced.

“We also have as a national air carrier a serious committed social responsibility to fly to all destinations of the domestic market”.

Recalde concluded pointing to the previous owner and operator of Aerolíneas, Marsans.

“Each time I look further and further into the company’s books I can clearly see that the private management was not efficient for the air carrier, but rather extremely efficient in executing a plan to empty Aerolíneas Argentinas”.