MAH4546
Topic Author
Posts: 24560
Joined: Wed Jan 24, 2001 1:44 pm

Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 12:49 am

According to the Miami Herald, the Argentine government as threatened Aerolineas Argentinas to re-start 747-200 and A340-300 service to New York City, Miami, Los Angeles, Auckland/Sydney, Sao Paulo, and Rio de Janiero, or they will face sevre penalties, none more great than the threat that the government will discontinue AR's route authority on domestic routes. The Herald also reports that oneWorld members LanChile and Amercian Airlines, as well as American's Brazilian partner, TAM, might begin to bid on AR's loss routes if thier position continues to get worse. LanChile would love to add EZE services out of MIA, were they already to fly with Fifth Freedom Rights to cities in Ecuador, Columbia, Peru, Venezuela, and the Dominican Republic, along with Chile.
a.
 
Guest

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 6:08 am

I have to say this is not accurate. Nothing of the sort has been said here in Argentina, actually the opposite. I'm pretty sure that if any airlines would get the routes it would be Souther Winds or LAPA. There has been talks about taking over the routes and the employees, these airlines would receive some kind of big tax discounts and other benefits. But these reports from the Miami Herald??? hmmmm I don't know .... do you have a link to it?

I don't have time to translate, but I would check out Clarin.com.ar

Peter
 
AeroArgentina
Posts: 190
Joined: Tue May 08, 2001 4:28 am

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 7:00 am

LV-7772
What you say is correct. If AR does not start flying its routes in a month they will be bid off probably to SW and LAPA. Both airlines might merge as Eurnekian (owner of SW and the airports in Argentina) wants to buy LAPA which is also in financial difficulties. This would create a huge airline/airport monopoly if AR goes away as there would be basically one airline in Argentina (Dinar is not big enough to compete). They would not sell the routes to a foreign airline. The whole country would go crazy. Clarin.com and Lanacion.com are great sources if you can read spanish.
 
MAH4546
Topic Author
Posts: 24560
Joined: Wed Jan 24, 2001 1:44 pm

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 7:40 am

All the article said was that AA, LA, and TAM are interestead in the routes. Nothing about the Argentina government wanting to sell it to them. You can find the article in the Business section of http://www.herald.com. I do speak Spanish, and your right about those two sources. They are great.
a.
 
Guest

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 7:41 am

I agree Aero. I highly doubt, as stupid as our government can be at times (just like any other country) will not sell the routes to American or LanChile...they would not do that, especially after this mess with Iberia/SEPI/Spain.

I have to disagree with the monoply though. Does Argentina really need 4 airlines anyway? You have to remember that for a long time AR was the sole airline, Austral did great in the domestic market before it was taken over (the good old days AU was sooooooo good on it's own) and LAPA was just a small player with props, but served it purpose.

In one article on Flight International, someone from LAPA (sorry I don't have the magazine with me and don't recall his name) said that the market (here in Argentina) could be serve by one airline with just 45 planes... I agree.

If AR finally goes, whenever that will be...... I don't think that Eurnekian's idea is a bad one. If only for SURVIVAL! Merge and give Argentina a good product and maybe a flag carrier we can be proud of and not be run by someone who might not give a s***!

But everyone keeps talking, negotiating, etc. and our President now says that AR will continue.... ok, sure.
I understand about the jobs! 6500 people would be un-employeed, we don't need that.
I for one would like this thing to end already! Got to wait and see.......

Peter
 
LatinPlane
Posts: 2471
Joined: Mon Dec 27, 1999 11:05 am

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 10:16 am

De La Rua said that Aerolineas will continue to fly but the same thing was said by the president of Venezuela after Viasa suspended their services for a month to "reorganize itself". This is what I recall him saying: "Estoy seguro que las alas de Viasa volvera a volar por los cielos del mundo en un mes mas con la bandera de Venezuela". (Translation) "I'm sure Viasa's wings will return to the skies in one months time flying Venezuela's flag throughout the world once more". Sadly this was not the case...


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I defenitely agree with LV-7772, Argentina at the current moment has too much capacity and too much competition. However, you can't really afford to have only one airline with 45 aircraft because then air fares will sky rocket due to lack of competition. This is not good for the consumers as well as for the tourist market. There needs to be some sort of competition in order to have a good balance of good service with stable airlines. These are the extreme cases in Latin America where such things happen: Peru has so much competition in its market that all of its airlines have gone bankrupt and Mexico's government has given so much protection to AeroMexico and Mexicana that they are so powerful that domestic passengers are complaining that they charge high fares on the domestic routes they have a monopoly.

In any case, if the government decides to redistribute AR's route authorities they will be handed down to Argentinian airlines not foreign airlines. However, it seems like the current airlines; Southern Winds and LAPA are not strong enough to take them over. First of all, although Southern Winds states they are prepared to fly them, they are not experienced enough to venture out from one day to another with long haul routes. They don't even fly the smallest of AR's airplanes, which are only 737's. It takes time to learn how to climb the ropes and such a bold step sometimes has a devasting effect if things aren't done properly. Maybe someone like Lan Chile can come in and help them establish themselves. LAPA seems like it's too weak to try to venture out and expand.

Just my imput.

Best regards,
A. Diaz
Pan Am - The World's Most Experienced Airline.
 
SegmentKing
Posts: 3224
Joined: Sun Aug 27, 2000 7:16 am

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 11:12 am

Here is the link:

http://www.miami.com/herald/content/business/latam/digdocs/093221.htm

Nate
~ ~ ~ ~ pRoFeSsIoNaL hUrRiCaNe DoDgEr ~ ~ ~ ~
 
TOMASKEMPNER
Posts: 389
Joined: Wed May 02, 2001 3:21 pm

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 11:55 am

I think that UA will try to get the LAX-EZE route, but AA might be interested in this route too.

As for the MIA- EZE, and JFK- EZE routes
AA flies twice daily from MIA (777) and daily from JFK also in 777.
UA flies daily from ORD, MIA and JFK to EZE

The EZE-AKL-SYD route ¿¿¿ AZ????
because Qantas already operates this route




 
AeroArgentina
Posts: 190
Joined: Tue May 08, 2001 4:28 am

RE: Gov't Threatens AR; AA Might Buy Routes

Thu Jun 14, 2001 1:35 pm

LatinPlane
If AR goes away what will probably happen is a guy named Eurnekian who owns SW as well as the airports in Argentina will probably buy LAPA as well as AR's routes. This guy is rich and powerful and wants to have American or Delta help invest in this new mega-airline for Argentina. I think it will have the resources to take over AR's position the only problem is that it will leave no competition. Too much competition is bad but so is no competition. A balance is needed. Plus when (or if) the recesion in Argentina goes away I bet more than 45 planes will be needed for the domestic market. Just my 2 cents, although Peter is right AR and AU did a great job before 1990. I might have been small back then but I still remember. Oh well.

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