Argentinean airline builds executive charter fleet

 - February 2, 2007, 8:50 AM

With two straight years of 8-percent economic growth, Argentina appears to be on the road to recovery, as does the country’s flag carrier airline, Aerolíneas Argentinas. After several difficult years, Aerolíneas, which recently made its final payment to creditors to exit bankruptcy protection, is preparing an aggressive expansion plan that includes adding two new aircraft to its executive charter fleet by the middle of next year.

The airline began offering business aviation services two years ago in response to growing demand from local businesspeople, many of whom had been forced to sell their aircraft during Argentina’s deep recession. In 2002 alone, the crisis forced more than 200 companies to shed their aircraft, and although the economy has begun to show signs of improvement, few companies yet have been able to replace their aircraft. As a result, Aerolíneas began offering charter flights using a specially refurbished Boeing 737-200.

Demand for the “executive jet” service has been solid since its 2003 launch, according to Julio Scaramella, director of institutional relations for Aerolíneas Argentinas. “We’ve noted significant demand for the service,” he told AIN. Clients include Argentina President Nestor Kirchner, members of Argentina’s fast-growing oil industry and foreign businesspeople traveling in the country.

The airplane can fly nonstop to any destination in Argentina and also to Rio de Janeiro and São Paulo, Brazil; Santiago, Chile; and Santa Cruz, Bolivia. Charter rates start at approximately $5,000 per flight hour. The airplane has room for 29 passengers with meeting rooms, galleys and a private office, along with 10 first-class seats.

Hot on the heels of its financial turnaround, the airline has begun the process of upgrading its fleet, which will involve replacing two 737-200s that are currently flying commercial routes. Rather than disposing of them, Aerolineas will refurbish and reconfigure the two aircraft and reassign them to the executive charter market. The firm expects to have them both operating in their new role by next year.

Aerolíneas Argentinas has already begun the process of refurbishing the second 737 in the executive jet fleet. Like the first aircraft, the second will use an interior plan developed by U.S.-based Completion Air, but the renovation is taking place in Argentina. The nine-month process costs approximately $2.4 million per airplane and requires 62,000 hours of labor.

At the same time, the aircraft will undergo a D-Check inspection and will be cleared to the standards of both the FAA and Argentina’s Aeronautical Certification Agency. It will be based at the Jorge Newberry Airport, located near downtown Buenos Aires.