/CORRECTION/TRANSPORT/LABOUR-ARGENTINA: Flagship Airline in Final Throes?

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, May 3 2001 (IPS) - Aerolíneas Argentinas, a company that was privatised in 1991, is in its ninth day of a strike triggered by the layoff of more than 500 technicians. The airline may soon be shut down, agree union leaders, meaning 5,000 people would lose their jobs.

Edgardo Ferreira, of the Argentine Airline Pilots Association, told IPS that one possible scenario is the definitive closing of the emblematically Argentinean enterprise, which is currently run by Iberia, the Madrid-based airline.

Another possibility is that the company could shut down temporarily, reopening later with a portion of its liabilities resolved. Aerolíneas’ current debts are estimated at one billion dollars.

Meanwhile, other companies have covered the regular flights of Aerolíneas Argentinas, and of its subsidiary, Austral, since the first days of chaos and stranded passengers over a week ago.

The airline technicians, meanwhile, have issued warnings about the increased risk of accidents due to the lack of aircraft maintenance.

Ricardo Cirielli, secretary general of the pilots’ union, said the layoff of personnel in his sector would be the last step before the company closes its doors. He is planning to go to Madrid to meet with the authorities at SEPI, a partnership of industrial concerns that is in charge of managing Aerolíneas Argentinas.

Lawmaker Alicia Castro, delegate for the flight attendants’ syndicate, pointed out that her union has been cautioning for quite some time that the company is being manipulated in order to open the Argentine skies to other companies, primarily those based in the United States.

Aerolíneas Argentinas was privatised in 1991, when the number of employees was twice what it is today and the company owned 30 aircraft outright, compared to just one currently.

Under Iberia’s management, hangars and flight simulators have been sold, and services that were previously provided by the company itself, such as baggage handling, were auctioned off and are being exploited by the competition.

The Argentine flagship airline has also lost more than 40 routes, which were either abandoned because of costs or ceded to other companies.

As far as flights to Europe, which are the most profitable, Aerolíneas Argentinas today flies only to Madrid, while Iberia, with its own aircraft and its agreements with other airlines, has taken over the rest of the destinations in that region.

Throughout the last decade, Aerolíneas has suffered numerous union conflicts and has reached the brink of bankruptcy on several occasions.

But this time, the company also faces a lawsuit for the liquidation of capital, charges filed by the national Ombudsman’s Office and which the federal justice authorities characterise as “concealment” by the government of Fernando de la Rúa.

The company’s current tensions began nine days ago when the mechanics’ union, the Association of Aeronautical Technical Personnel, demanded the re-incorporation of 224 of their colleagues who had been laid off, and of another 58 whose contracts had not been renewed by Aerolíneas or by Austral.

But the response to their strike was a new wave of layoffs on Tuesday, International Labour Day, affecting another 250 technicians. Thus, in just nine days, the 1,300 technicians that were employed by the two airlines have been reduced to fewer than 800.

And the strike continues, even under the threat that the companies could close their doors forever.

There are six unions involved in the aeronautics industry in Argentina and they usually act as a bloc. But the country’s social crisis and lack of jobs, in addition to the possibility of the airlines’ bankruptcy, have contributed to the fact that, this time, only the technicians’ union is involved in the strike.

The pilots, meanwhile, accepted salary cuts. Their union delegates voted against participating in the strike even though they recommended supporting the mechanics’ protests. They believe the strike could be the last step before they, too, lose their jobs, or the company finally goes under.

The De la Rúa administration has kept its distance from the conflict even though the government still holds a five-percent share in Aerolíneas, a stake that would allow it to demand balance sheets and other data that the unions stress should be available for the scrutiny of all shareholders.