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Argentine airline unions are threatening to strike Thursday if the government goes ahead with plans to evict the local subsidiary of Latin America’s biggest carrier from its Buenos Aires airport hangar.
Regulators have given LATAM’s LAN Argentina until month’s end to vacate its hangar at Aeroparque airport in downtown Buenos Aires. LATAM says Argentina’s government wants to undermine the company’s competitive advantage against money-losing state-owned Aerolineas Argentinas.
Unions say more than 1,000 LAN employees could lose their jobs if the eviction goes through. The Argentine APTA and Atcpea unions, whose members include airplane technicians, flight attendants and ground crews, warned on Monday that its members will strike on the eviction deadline.
“We’ve determined a nationwide stoppage for all airlines — Aerolineas Argentinas, LAN, Andes and Sol — that will affect international flights,” APTA union leader Ricardo Cirielli told reporters, listing the airlines that operate at Aeroparque.
Aerolineas Argentinas flies to most of the country’s cities and covers international routes including Madrid, Barcelona, Miami and New York. Sol has flights within Argentina and Uruguay, while Andes has cargo-only routes.
LAN now has 10 planes serving 14 Argentine cities. It says it will have to stop flying domestically in Argentina without the maintenance hangar. The company pays $20,000 a month in rent on the building under a contract that expires in 2013.
Aerolineas also has expanded its service, but continues to bleed money despite government subsidies that keep most of its ticket prices below what LAN charges. Many passengers prefer LAN because it has a better on-time record and has fewer delays due to strikes and other labor problems.
Flag-waving union members blocked the road leading to Aeroparque on Monday.
LAN Argentina, meanwhile, went to court to try to block the regulator’s decision.
“We want to keep flying in Argentina and that’s why we need our hangar in Aeroparque,” LAN said in a statement published by local newspapers.
The government says the eviction won’t affect the company’s services and LAN will be allowed to “continue its operations to and from the airport without risking operational security or jobs.”
The conflict with Argentina’s government is the latest setback for LATAM, which was formed when Chile’s LAN took over Brazil’s TAM airlines last year.
The company announced a quarterly loss of $330 million last week due largely to currency fluctuations in Brazil, and it was fined $1 million by Canada in a price-fixing case involving South American cargo shipments.
LATAM’s shares have lost more than half their value in the year since the merger.
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