antipodean
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- Oct 20, 2019
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Good, let the airlines fail, once flights resume new airlines will take their place. Any 'bailouts' for them should instead go directly to their employees.
I’m not sure that reflects the reality in Argentina.
AR would be a state monopoly, as it was for a long time and I experienced first hand, it was not good for jobs or the community or the economy.
Their employees still went on strike. Airfares were prohibitively expensive. They (together with K governments and various other state owned monopolies) aggressively blocked entry to new airlines and repeatedly placed anti-competitive roadblocks on LATAM both major and petty (Eg refusing their planes to use finger piers and make their pax take a bus to a remote stand) There was less domestic tourism. Their were less international tourists visiting the interior. The cost to the state exceeded US$3m a day in “bailouts”, The airline never made a profit.
JetSmart, FlyBondi and LATAM do not make big profits like say North American Airlines. At the best of times margins are paper thin - you have a $100m aircraft with 180 seats costing $10k an hour to fly and if you make a profit of $3 per pax... amazing. LATAM has gone 3-5 years without making money off Argentina.
If they go, no one will replace them in Argentina for a long time or until a regime change at least. Next time rich expats want to go home or explore the country they will complain about high fares. Next time middle class Argentines want to fly, they take a bus.