The company must define, in the short term, new investments to continue its growth. This is intended to improve competitiveness.
Buenos Aires, August 13, 2018.- Aerolíneas Argentinas called all six unions representing its workers to an open discussion with no preconditions regarding competitiveness, to allow the company to begin a new stage of growth.
Today, the President of Aerolíneas Argentinas, Luis Malvido, welcomed the representatives of the six trade unions that group the company’s workers. At such meeting, he proposed to conduct negotiations with each union in particular about a list of working conditions. The goal is to promote competitiveness regarding the new investments required by the potential growth of the company.
The airline is facing a significant deficit that forced all Argentine people to make an average of 678 million US dollars’ worth of contributions per year for one decade. In the last two years and a half, the company worked intensely to reduce the application for financial aid to the National Treasury, but now new negotiations must be conducted in order to make the work of 12,250 company employees more productive.
Between 2015 and 2018, Aerolíneas Argentinas’ fleet increased from 74 to 83 aircraft. Additionally, 24 of those planes are brand new. This entailed significant investment efforts on the company’s part and a strong support from the National Treasury. Now, a new stage begins, with the need to urgently renew part of the Embraer fleet for transatlantic and domestic flights.
Without the incorporation of at least two new aircraft during 2019, Aerolíneas will not be able to cover all of its international routes. The decision on these planes must be made within the next 60 days.
On the other hand, Austral has similar pressing needs. It must define, within the next 90 days, the renewal of its Embraer fleet, since it needs more modern and larger-bodied aircraft to be able to compete against the new operators that are coming to the market.
The Aerolíneas Argentinas Group has already worked intensely in the search for greater productivity. It renegotiated agreements, saving millions, such as those agreements signed with booking companies, which entailed the reduction of annual payments by USD 30 million. It also cut its purchases by USD 80 million per year thanks to transparent and ample bidding processes, and decreased its financial costs through the timely publication of its balance sheets. Today, the company seeks to take a step further, together with all its employees, in search of greater competitiveness. It aims to match the levels of other companies operating in the market.
In this sense, the company has repeatedly started negotiations with its workers to discuss working conditions to allow taking its competitiveness to the industry standards, without impairing the safety and quality of the services. The results of these negotiations, however, have been insufficient to confront the challenging situation the market is currently facing, and, mainly, to make the most of the opportunities provided by the very same market. That is why Aerolíneas has now called all the union leaders, since the time elapsed with no favorable results poses a risk to the investments and future sustainability of the company.
The meetings with the trade unions are scheduled to begin this week and will be held separately with every union, given that the issues to be discussed are specific for every one of them.