The plan includes the installation of fireproof systems and other expansion and modernization works. This effort is in addition to further investments in infrastructure for the amount of USD 32 million, which are already underway.
Buenos Aires, August 29, 2018.- Aerolíneas Argentinas is undertaking new works in its hangars for the sum of USD 30 million, in addition to investments in infrastructure for USD 32 million.
The airline is increasing its investments in safety and maintenance. An aggregate amount of USD 15 million will be allocated to fireproof system installation in Ezeiza’s hangars. A similar amount will be allocated to hangar improvement works in Ezeiza and in Aeroparque (City of Buenos Aires).
These works are in addition to the ones already underway for the modernization and expansion of the existing infrastructure in different airports throughout the country: Bariloche, Córdoba, Chapelco, Iguazú, Mendoza, Tucumán, Comodoro Rivadavia, Resistencia and La Rioja, among others. Additionally, the plan includes the purchase of ramp equipment, as well as a major investment in systems. These investments, approved in the budget for 2018, amount to USD 32 million.
The company has already made significant investments in hangar infrastructure. This year the company inaugurated its biggest hangar, Hangar 5, in Ezeiza, where maintenance is performed on the fleet’s largest airplanes. Moreover, USD 2.4 million was invested in the installation of optic fiber and Wi-Fi networks in said workplaces.
The funds needed to carry out this ambitious investment plan come from the contributions made by the Argentine Government and the sale of the company’s non-operating assets (for example, six floors in an office tower owned by the company and located in Bouchard street, in the Buenos Aires City center). The assessed value of these facilities is USD 15 million, and they will be put up for auction in September.
As an additional source of funding, the sale and lease back of two airplanes of the B737-700 fleet is under evaluation. In practice, this transaction entails the sale and immediate lease back; therefore, the aircraft will continue in full operation until they are permanently unscheduled from service, which is expected to occur during May and June, 2021. Following said period of time, these aircraft will be replaced by B737-MAX8 aircraft. The estimated additional income from the sale of these two aircraft is around USD 32 million.
Lastly, the company will carry out the sale of 50,000 spare items unscheduled from service for an amount of around USD 3 million.
These decisions are part of a path taken two and a half years ago, through which the company has achieved the reduction of costs by means of contract renegotiations, a more transparent purchase system, and the optimization of available resources. There were also major investments made during this period aimed at achieving a competitive position in an increasingly complex market. The most important investments are: the incorporation of 24 airplanes (4 Airbus 330-200, 4 Embraer 190, 11 Boeing 737–800 and 5 Boeing 737–MAX8); the company’s digitalization plan, with investments stacking up over USD 10 million during the last two years, including a new data center assembly, the purchase of new main data processing equipment, and the laying of 10 km of fiber optic cable, among others.
