MercoPress. South Atlantic News Agency

Brazilian aircrafts for nationalized Aerolineas Argentinas

The Argentine government signed Thursday a contract to purchase twenty mid range aircrafts from Brazilian manufacturer Embraer for recently nationalized flag carrier Aerolineas Argentinas. President Cristina Fernandez de Kirchner said these will be the first new aircrafts for Aerolineas in 16 years.

six E-170 jets, all made by Embraer, which has become one of the world’s leading aircraft manufacturers and one of Brazil’s top exporters.

The agreement was signed at a ceremony in Argentina's Government House (Casa Rosada) and involved 700 million US dollars, of which 585 million a loan extended by Brazil’s development bank, BNDES.

The first of the Embraer 190 jets, which seat up to 114 people, would be delivered to Aerolineas Argentinas next April 2010 and from then on two per month. The deal stipulates that future repairs on the aircraft must be carried out in Argentine workshops.

“The fact that after 16 years, Aerolineas Argentinas is buying new planes isn't just economic news it's also about getting back some of our national pride” President Cristina Kirchner said in a speech to mark the signing.

The airlines, (Aerolineas and subsidiary Austral) which have a debt-load of about 900 million US dollars, were plagued by strikes and cancellations before the state takeover. At the time, only 26 of their 85 aircraft were operating.

Earlier this year, the Argentine government also announced it would also buy 12 planes from US manufacturer Boeing.

Aerolineas Argentinas and Austral dominate virtually the whole of Argentina’s domestic market. After a bitter struggle with the Spanish group Marsans Aerolíneas was taken over by the Kirchner administration with the support of the unions. Marsans complained that with frozen air fares, soaring fuel costs and striking unions the company was forced into bankruptcy.

According to the Buenos Aires press Aerolineas is accumulating significant monthly operational deficits.

The signing ceremony in Government House was headed by President Cristina Fernandez de Kirchner next to Planning minister Julio De Vido, Defence minister Nilda Garré, Transport Secretary Ricardo Jaime, Aerolíneas CEO Julio Alak and the chairman of the powerful trade unions federation Julio Moyano.