The Spanish businessman Antonio Mata, president of the executive commission of Aerolíneas Argentinas sings his praises to life. “In the coming years, Aerolíneas will have the most modern fleet in South America,” he speaks into every single microphone he finds in his way, although so far the company has 51 planes, of which the latest are four Airbus 340-200 that left the factory some five years ago. The rest of the machines (B747-200, B737-200, MD 88, MD 83 and MD 81) average 20 years of age.

Mata is convinced that his company will get back on its feet all on its own. However, there is some suspicion about the Spanish government financing that is still behind Aerolíneas Argentinas, though it no longer controls the company. Each time he is asked, the Spanish businessman denies the rumor.

Aerolíneas flies high. They maintain that they hold 80% of the domestic passenger market. However, a study of the consortium that administers the main air terminals in the country reports that in fact, during the past year, they handled 59% of the market. They are, indisputably, the leaders in the domestic market, though between one estimate and the other there is a difference of over 20 points.

The company disqualifies the Aeropuertos Argentina 2000 (AA2000) report and assures us that during the last four months in 2002 it carried “at least 79%” of the passengers flying within the country.

Notwithstanding, and always according to the data broadcast by AA2000, the participation of the various companies in Argentine domestic flights during last year was as follows: Aerolíneas Argentinas and Austral (59%), LAPA (18%), Southern winds (13%) and Dinar (6%). The other companies shared the remaining 4%.

“The AA2000 figures are false,” they say at Aerolíneas. AA2000 explains that the figures they handle are the same declared under oath by the different companies before take-off from the airports. What if the figures declared are not real? Ah… that is a different matter.

“What is true is that our figures logically refer only to the airports we manage,” they add at Aeropuertos Argentina 2000. Their statistics do not include the Ushuaia, El Calafate, Rosario, Santa Fe and Jujuy airports, just to mention the main ones. “In any case, we don’t think the movement these airports may have had all along last year can explain the 21-point difference between what Aerolíneas says and what we receive under the form of sworn statements from the companies,” they conclude.

In any case, be it 59% or 80%, the growth of Aerolíneas Argentinas was remarkable, particularly when one year before, in 2001, its participation in the market was 33%.

How was this growth achieved? How did the company manage to recover the domestic market so rapidly?

Undoubtedly, the brand is very important. When the company was practically paralyzed during several months in 2001, with most of its planes grounded and hundreds of employees suspended from work, the general comment was that “the only good thing left to Aerolíneas is its brand”.

The new management took advantage of this fact, with Antonio Mata at the head, to take off again. They based themselves on its brand strength and a planned communication strategy in the press, which was always willing – through ingenuousness or convenience – to publish whatever the Aerolíneas management desired.

Declarations

In mid 2002, the chairman of the executive committee of Aerolíneas Argentinas asserted that as of October they would start flying from Madrid to Vienna, Athens, Tunis and Istanbul. “The experience derived from our new connections in Europe (Paris and London) is magnificent, with occupancy sometimes reaching 92%. That is why we believe the new routes will have a similar success,” expressed Antonio Mata, according to the statement published in a business and economy newspaper in Argentina on 26 June 2002.

So far, the only European destinations of Aerolíneas continue to be Rome and Madrid. Landings in Paris and London are carried out using smaller planes and through a connection in the Spanish capital, while there was no further talk of Vienna, Athens, Tunis and Istanbul.

A similar plan to that mounted in Madrid was announced for Miami, reaching various points in the USA and the Caribbean. The idea never took off, though it had been announced that some of the connections would be using Continental Airlines flights, with which it was said “an imminent” agreement of shared codes was to be signed. No further news was had of this accord.

At the beginning of November the company announced that in December it would begin receiving “the eight planes, either purchased or leased”. They said they would add Boeing 737-300 and 747-300 planes to their fleet, plus others provided by the Airbus builders, of the 319, 320 and 340-600 type. Halfway through March, no new planes have joined Aerolíneas.

AIR MARKET contacted Boeing and from Seattle they stated that “Aerolíneas Argentinas is a prestigious company with which we wish to continue doing business, but so far there is nothing substantial in view”. There has been neither sale nor leasing: Boeing has signed no accord with Aerolíneas to deliver planes.

The same applies to Airbus, but the European builder prefers to make no comments. On some of the maker’s documentation Aerolíneas Argentinas is mentioned as a “launching client” for the A340-600, but there is no certainty that these machines will be delivered in effect. Nor is there any agreement for incorporating A319 and/or A320 planes.

It had been announced that Aerolíneas would be landing in Cancún, Mexico DF and Milán by January 2002. Although this announcement was made enthusiastically by Antonio Mata, the company planes never reached these destinations. Asked by AIR MARKET during a press conference, the businessman justified the suspension of the plans on account of the low market demand.

At the end of last year, in December, Antonio Mata himself became enthusiastic again in front of a recorder and spoke about a dream: the creation of four airlines in South America, one in Chile, another in Bolivia, a third in Paraguay and the last in Uruguay, all of which would only require an investment of 30 million dollars.

To start the operations the Aerolíneas boss thought of assigning two 737-200 and one 747-200 Boeings from the company to each new country where a branch would be opened. Surprising, not to say ridiculous. Of the four countries where Mata intends to create a “sister” for Aerolíneas, perhaps Chile is the only one in a position to provide acceptable occupancy to a Jumbo (though LanChile, market owner of its country, has not been using them for some time already).

On the other hand, the 30 million-dollar investment (7.5 for each country) is laughable.

Last December, when the European Civil Association authorized Aerolíneas Argentinas to carry out the technical maintenance of the fleets of companies in the Old Continent, in Buenos Aires the news was received with boundless euphoria and they even risked the remark that “in the next few days we will be announcing the first contract” with an European line.

No news is bad news.

In October 2001, a few days after taking over the Aerolíneas Argentinas management, Antonio Mata had announced with a great deal of fuss that the company would once again have freight planes, which has not happened so far. At that time, there was talk of adapting a Boeing 737-200 – a machine used for domestic and regional flights – but now the objective appears to be different. “It is on long flights where we perceive that the investment on a plane can be more profitable,” said Mata some time back, speaking to AIR MARKET, to explain why a change of direction had been given to the strategy, and now the talk is about using a much larger plane, such as the 747-200.

“We are assessing the investment needed to modify a Jumbo from an economic viewpoint,” remarked Mata. However, a high-ranking company executive, also questioned by this medium, admitted that the possibility of adapting a 747 for freight is a risky stake that it will be difficult to carry out. “Yes, it does seem strange,” he said.

In mid January of the current year, Aerolíneas broadcast a communiqué echoing a report published by MIS (Monthly International Statistics), an entity dependent on IATA, which presents the company as showing the greatest growth in South America, in what concerns number of carried passengers per kilometer between January and November 2002 as compared with the same period in 2001.

So what’s new, if during most of 2001 – the worst year in the history of the company – the Aerolíneas planes spent more time on the ground than they did in the air?

This is all mere talk. Surely, the idea is that announcing a large number of good news improves the company image amongst potential clients. And the figures seem to support this notion, because Aerolíneas – as has already been said – leads the domestic market and in one way or another recovered many of the international destinations that were suspended during 2001.

It remains to be seen if during 2003 Aerolíneas returns to the Asian continent to land in Tokyo and Peking, as Antonio Mata promised, or if it finally completes the delayed creation of Aerolíneas Executive Jet, the business unit of the airline assigned to carry business people on board a Boeing 737-200 exclusively adapted to that use, with just 30 seats and a great deal of comfort. If this does not materialize, the announcements will have been part of – once again – the optimistic strategy Made in Spain.