Ponta Delgada, Azores Islands, Portugal, Oct. 20, 2025 (Lusa) - The possible closure of the Portuguese Azores Airlines could have an impact of around €1.27 billion and cause the loss of 815 jobs directly, according to a report by the Angra do Heroísmo Chamber of Commerce.
A technical report released by the business association warns that the "disappearance" of Azores Airlines, whose privatisation is currently being negotiated, is a "systemic risk that would affect the entire economic fabric of the Azores region".
"The collapse of SATA Internacional (...) would have a total estimated economic impact of €1.266 billion, corresponding to more than a quarter of the regional GDP [Gross Domestic Product] and half of the annual revenue of the Autonomous Region of the Azores," reads the study sent to the press by that business association.
The report points out that the approximately 1.27 billion represents the "total direct and indirect losses associated with the collapse", arguing that the closure of the company "would not only be a business problem, but a large-scale economic and social shock", with "immediate effects on mobility, tourism, tax revenue and employment".
The analysis estimates that the closure of the carrier would result in the loss of 815 direct jobs and the "risk of partial collapse" of the group's other company, SATA Air Açores, responsible for inter-island connections.
In addition, the closure of the company would lead to the "destruction of €436 million in assets and equity", the "transformation of €75 million in regional guarantees into public debt" and a 20% drop in tourist flow in the region.
"Even after three years, around 40% of the initial losses would remain uncompensated, highlighting the seriousness and persistence of the risk to the Azorean economy," warns the Chamber of Commerce.
Other "structural consequences" may also be at stake, such as the "erosion of external confidence", the "discontinuity of rapid regional exports", "increased isolation" and "increased budgetary pressure" on the Regional Government (PSD/CDS-PP/PPM).
The report suggests completing the privatisation process, the legal ‘'insulation" of SATA Air Açores, the creation of a Regional Mobility Stabilisation Fund and a Contingency Plan for the Aviation Sector.
The Angra do Heroísmo Chamber of Commerce and Industry argues that privatisation is the "only possible way to save the company" and calls for "the interests of the Azores to prevail over any personal and obscure interests".
"It is important to express our enormous concern about the intention to ask the European Commission for an extension of the privatisation process, with the aim of opening up space for direct negotiation," it laments.
The business association, which criticises the role of politicians, management and trade unions in the current state of the company, considers it "obvious" that the region will have to assume the company's liabilities.
"The payment of the debt and the assumption of any compensation for management errors committed are, at this moment, the lesser evil for the Azores and, in our view, the only possible way to avoid greater future problems for the region," stresses the organisation led by Marcos Couto.
The privatisation tender jury has asked the Newtour/MS Aviation consortium to submit a bid for the purchase of Azores Airlines by 24 October, a source close to the process revealed to the Lusa news agency on 13 October.
In June 2022, the European Commission approved Portuguese state aid to support the restructuring of the airline in the amount of €453.25 million in loans and state guarantees, providing for measures such as a reorganisation of the structure and the divestment of a controlling stake (51%).
RPYP/AYLS // AYLS
Lusa
