William Franke is an American lawyer and businessman who positioned himself as the main reference for “low cost” airlines, both in his country and in Europe and Latin America. In a few days it will be 82 years old but it is still more active: yesterday it arrived in the morning to Argentina in its private jet, traveled by car to El Palomar and got back on a plane, an Airbus A320 just out of the factory, with which Jet Smart Argentina made its inaugural flight to Mendoza. During the flight, Franke spoke with Clarín and asked the government to win in December to maintain the rules of the game for the sector.
“In the business world, for us the important thing is stability, no matter which party is in power, about which I am not an expert: but the most important thing is that a country is predictable to be able to carry out business there, “said this entrepreneur, founder of the investment fund Indigo Partners, which controls several low cost airlines around the world: the United States (Frontier Airlines), Hungary (WizzAir), Mexico (Volaris) and, now, also in Chile and Argentina with Jet Smart.
-They start to compete in the local cabotage market, where 70% is in the hands of Aerolíneas y Austral.
– But we do not take passengers from other airlines, but we grow the market. We have a lot of experience in that: we try to fly more passengers, that the cake is bigger. We have a low cost efficient business model, while our competitors have a different model.
tSmart already has three aircraft with local registration and 75 employees, including employees who provide their own ramp service in El Palomar. He joined the competition proposed by Flybondi and Norwegian, with an initial fleet of two aircraft to fly 17 routes to eight cities in the country. By the end of the month, they will add a third Airbus A320 and, according to their CEO, Estuardo Ortiz, they will reach five aircraft and 200 employees by the end of the year. Every day, the three Airbus will take off from El Palomar and return there for the night.
President Macri publicly asked him to increase the number of planes and employees. You did not say yes, what he did was raise his thumb, Clarin insisted to Franke.
-We have the largest aircraft order that Airbus has ever made, with 430 new aircraft for the next five years. Many will be planes that will be used in the region, so that with planes there are no problems. We believe that if Argentina becomes the successful market we expect, they will see a significant number of our aircraft in this market.
-Between the announcement of the opening of a local subsidiary and the start-up, the peso was devalued close to 60% …
-60% of the costs of an airline is in dollars: airplanes, fuel and spare parts. We have to sell the tickets in pesos and convert them to dollars to pay the bills. So that is an important factor, without a doubt. But we believe that in Argentina the peso stabilized in the range of 38/44 pesos and I believe that within that range we can handle well. In fact we are used to dealing with many different currencies since there are many different currencies in Central Europe and Eastern Europe. We are good at managing other currencies.