History: Aerolíneas Argentinas is the flagship airline of Argentina, with its hub in Buenos Aires. Despite its size and strategic location the airline's financial performance has been less than bright. Decades of economic crisis and an extended, painful privatisation have left the carrier struggling for survival till practically disappearing.
Argentine civil aviation has its roots in the French air mail line Aéropostale and its South American subsidiaries, one of which was Aeroposta Argentina.
In 1932, control of Aeroposta underwent several changes, including temporary ownership by the Argentinian post office. Beginning in the late 1930s, other airlines were starting to crop up in Argentina, then in 1949, a new nationalistic government in Argentina, merged the four joint-stock companies--Aeroposta Argentina, FAMA, ALFA, and ZONDA--into the new state airline, Aerolíneas Argentinas. This monopoly would last until 1956.
AR continued to expand and modernize its fleet,retiring older aircraft and establishing service to popular resort destinations.By the 1960s, AR was the leading South American airline. However, financial and managerial woes were emerging. In 1963 both AR and its competitor Austral had been losing money on the regulated domestic fares and had been granted government subsidies to help offset the losses.In June 1964 amid charges of mismanagement and corruption at the airline ordered several 707 from Boeing. It also began operating Boeing 747 widebody jets to Madrid in January 1977, launching a period of expansion. After testing the route with charters, AR pioneered the first scheduled services across Antarctica, to Auckland, New Zealand.
The company's was in poor financial health, losing $10 million a month in 1990. A consortium led by Spain's carrier Iberia made a bid in June 1990, Iberia would control 30 percent; three Spanish banks another 19 percent; Argentinian investors 36 percent; employees ten percent; and the government, five percent. resulting in 51 percent Argentine ownership. As costly as it proved to Iberia, AR still controlled one-third of South America's air traffic. Then after a resale American Airlines parent AMR Corp. took a ten percent share in 1998.It started reducing the number of aircraft types though it ordered a dozen Airbus A340s, a type new to Latin America, for its long-haul needs.
In June 2001,after the AMR Corp. pulled out,the airline filed for bankruptcy protection from creditors. Flights to Auckland, Los Angeles, Miami, New York, São Paulo, Sydney and Rio de Janeiro were halted, the suspension of the daily flight to Madrid, which also served Rome was the last connection with Europe,. After this, most of the fleet was grounded, and only 30% and 10% of domestic and international flights, respectively, were operating.
Then a breath of fresh air came from Marsans group who acquired a 92% stake through its subsidiary Air Comet with the intention of resuming short as well as long–haul services.
In May 2008, the Argentine Government took the airline back into state control in July 2008 after acquiring 99.4% of the stake for an undisclosed price. In November 2011,the government announced an austerity plan for the company in order to reduce the deficit it has been incurring since being taken over from Marsans.
Since then the airline has been growing with good load factors, serving strong markets and making its domestic network a feeder to its long haul. New orders for Airbus Aircraft A330 and B-737-800 have made the airline stand out again and it's on route to achieve a profit once again after many years of losses.