Summary
- Aerolíneas Argentinas' first wage increase proposal was rejected by its four unions as it was considered "well below the inflation rate."
- Employees were expecting a 15% wage increase but were offered only 7% by the airline, leading to deep discontent among the workers.
- The future of Aerolíneas Argentinas as a state carrier is uncertain, as the frontrunner for the Argentinian presidency, Javier Milei, has expressed interest in privatizing the airline.
Aerolíneas Argentinas’ four unions rejected the airline’s first wage increase proposal on Tuesday during the ongoing salary negotiations. According to the Unions, the proposal presented by the state carrier was “well below the inflation rate,” prompting them to reject it firmly.
Deep discontent inside Aerolíneas Argentinas
First reported by Aviacionline, Aerolíneas Argentinas and its unionized employees are in the midst of a labor dispute as they look to negotiate a salary increase. Sources close to the media outlet indicated that employees were expecting a wage increase proposal of around 15%. Instead, Aerolíneas Argentinas offered a 7% salary raise.
In a statement posted on social media, the Air Lines Pilots Association (or APLA, in Spanish) said that “far from contributing to the search for solutions, this attitude from the management of Aerolíneas Argentinas generates deep discontent among the workers of the company, as it disregards an undeniable reality that we experience day by day, as a result of the acceleration in price increases and devaluation.”
Argentina’s annual inflation this year is currently at 142.4%, according to analysts polled by the South American country’s central bank, as reported by Reuters.
The four unions (APLA, the Aeronautical Personnel Association – APA, the Aeronautical Technical Personnel Association – APTA, and the Union of Higher and Professional Personnel of Airline Companies – UPSA) announced they will remain awaiting a new meeting to unlock the wage discussion and move forward with an agreement.
Could Aerolíneas Argentinas be privatized?
Aerolíneas Argentinas’ future as a state carrier could be in jeopardy. Javier Milei, the frontrunner for the Argentinian presidency after shockingly winning the country’s primary election, is reportedly interested in selling the airline.
Last month, Milei said that Aerolíneas Argentinas needs to be privatized. He said “nothing done by the State” can be considered “efficient” during a campaign event he held in Mar del Plata. Since its nationalization in 2008, Aerolíneas Argentinas has never been profitable. Nonetheless, it has reduced its net losses in the last couple of years, posting its best result ever in 2023’s first half. The state company posted a $48 million net loss during the period, an 80% decrease compared to 2019’s $667 million net loss.
Javier Milei added that Aerolíneas Argentinas and other State-run companies have an exorbitant number of political positions, which is inefficient. “We are ready to undertake all the necessary reforms and bear the political costs that may be necessary.”
A short view at Aerolíneas Argentinas
The Argentinian state carrier is often considered one of the world's least efficient airlines. Since 2008, it has been highly subsidized by the government. It has mostly been protected against domestic competition. Only recently, newcomers, such as Flybondi and JetSMART, have been able to gain market share in the country.
Aerolíneas Argentinas has a fleet of 81 aircraft. The company operates nine Airbus A330-200 (and expects to receive one more) for long-haul operations. For short and medium-haul operations, it has eight Boeing 737-700s, 29 737-800s, seven 737 MAX 8s (with ten more coming), and 26 Embraer E-190s. Moreover, it has two Boeing 737-800BCFs for all cargo operations.
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Source: Aviacionline, Reuters.