Argentina purchases 20 airplanes from Embraer and wants to negotiate partnership
Valor Econômico 05/22/2009
Embraer and the Government of Argentina announced yesterday the execution of an agreement through which the state company Aerolineas Argentinas and its branch Austral Linhas Aéreas will purchase 20 airplanes form the Brazilian company to renew their fleet. It will be the first acquisition of new planes by Aerolineas in 18 years. Since the company was privatized, in the Carlos Menen Government (1989-99), only two new McDonnell Douglas aircrafts have been incorporated to the fleet by the partners - at first Iberia, and later the Marsans group, both of them from Spain.
The agreement involves US$ 700 million, from which 85% (US$ 595 million) will be financed by the National Development Bank (BNDES), through a credit facility to mature in 12 years and interest of 8% a year. The other 15% will come from the cash of Aerolineas/Austral.According to information disclosed by Embraer, the agreement includes a memorandum of understanding for the "support to the development and to the technological qualification of the Cordoba Material Area (AMC, in Spanish), aiming at the future supply of services and parts". The AMC is a complex for the production and maintenance of airplanes located in the capital of the province of Cordoba (800 km west of Buenos Aires.The new fleet will be formed by EMB 170 and 190 airplanes, with capacity for 70 to 122 passengers. The airplanes have flight endurance for 4,400 kilometers and should replace the old Boing 737-200 and 737-500, in operation for more than 30 years. They will start landing in the country in February 2010.