May 5, 2020 – Today, through a letter addressed to the workers of both companies, Pablo Ceriani, President of the business group, announced the merger of Aerolíneas Argentinas and Austral.
In the letter, the company explains that “The world crisis caused by COVID 19 has had a full impact on the commercial aviation industry, and we don’t know how long this situation will last. Everything indicates that we are still looking at several difficult months ahead: months with no income and no scheduled operations. This causes a huge impact on our industry and on the economy in general. Without income (and, once again, without knowing when this situation will come to an end) many airlines in the region and in the world will disappear.”
The letter further states that “The efforts made by the Argentine Government to keep the company running are becoming unbearable. Those efforts are in fact made by the whole society, and now society desperately needs the Government’s help to survive this pandemic that is ravaging humanity.
The Government invests in its flag carrier because this generates economic and social benefits that exceed the investment made. However, in the face of such a severe crisis, even the most profitable investments are adjusted when it comes to priorities.”
The merger will, in turn, allow for the creation of a new business unit, which will be responsible for the provision of independent aircraft maintenance services to other companies and members of the industry. The company will draw on the reputation earned in terms of safety and on the international certifications and infrastructure it has.
In the same vein, the company will work towards the creation of a cargo business unit, drawing on the experience gained from its cargo flights to Shanghai. The development of a specific business unit responsible for the transport of cargo was one of the Company’s long-standing pending issues.
“It is necessary for the company to operate at its highest efficiency. We have achieved this in some areas, but in others, there are still inefficiencies that we have not been able to solve: a structural lack of productivity that we have been carrying for many years. We need to address this, operate with the general efficiency of the industry and adopt its best practices. This is a moral duty we all have,” reads the letter.
Finally, the letter states that “We have a plan to transform the company, to make it grow and make it great. Growth and development, however, can only be achieved through an efficient and sustainable work scheme. If we are not able to adopt the best practices of the industry, there will be no use in growing and the fate of the company will not be the one we dreamed of, but the opposite instead. Those companies which do not adapt to ongoing needs disappear. That will surely be the fate of Aerolíneas Argentinas if we do not rise to the occasion.”
Nowadays, the company has a specific maintenance area to service Aerolíneas Argentinas aircraft and another area for Austral aircraft. Similarly, pilots, cabin crew and, to a lesser extent, ground personnel are also part of one of the two companies, so organizational structures are doubled.
It should be noted that the merging process will commence after the shareholders’ meeting is held and is expected to finish by the end of the year.