Category Archives: Iberia

Air France-KLM, easyJet, IAG, Lufthansa Group and Ryanair call for a new EU Aviation Strategy

European Union flag

The CEOs of Europe’s five largest airline groups – Air France-KLM, easyJet, International Airlines Group (IAG), Lufthansa Group and Ryanair – met collectively for the first time today (June 17) and agreed to work together to lobby for the development of a new EU Aviation Strategy that will support growth and jobs across Europe, strengthen the sector and give Europe’s passengers lower fares and more choice.

Air France-KLM logo

The meeting took place (in Brussels) in response to the new EU Transport Commissioner Violeta Bulc’s consultation on a new EU Aviation Strategy. The five agreed a vision for this strategy that would match the revolution in aviation that the liberalization of Europe’s airline sector created a generation ago, through the creation of the internal aviation market.

easyJet (UK) 2015 logo

The five airlines identified four measures that would support the Commission‘s objectives of enhancing the competitiveness of the European air transport industry both at European and international level, supporting growth and jobs across Europe and which would help consumers through the provision of more flights and lower fares.
These measures are:

The development of an EU Aviation strategy with a plan for a simple efficient regulatory structure, which would strengthen the competitiveness of European airlines, ensure jobs and growth through innovation (e.g. Horizon 2020), protect consumer interests and promote more efficiency to reduce costs.

Lowering the cost of the EU’s airports by ensuring that monopoly airports are effectively regulated; ensuring that passengers receive the full benefit of the commercial revenues which they create at airports; and that security charges are efficient. This could be achieved by reforming the Airport Charges Directive.

Delivering reliable and efficient airspace by reducing the cost of ATC provision; ensuring that ATC strikes do not cause disruption to passengers across Europe; resetting the Single European Sky strategy by focusing on using new technology to make efficiency savings; and using SESAR funding to drive compliance with the Single Sky framework.
Stimulating more economic activity and jobs by creating the right regulatory environment, removing passenger taxes and unreasonable environmental taxes.

IAG logo

The five CEOs – Alexandre de Juniac, Carolyn McCall, Willie Walsh, Carsten Spohr and Michael O’Leary – outlined their vision:

“Europe’s airlines form the most competitive sector in aviation with a diverse mix of carriers offering competition and choice to consumers.This is the first time we have set aside our competitive battles to highlight the importance of a new European Aviation Strategy.

The liberalization of aviation in Europe in the 1990’s, creating a fully liberalized single market with a comprehensive common regulatory framework 18 years ago, strongly enhanced competition across Europe.As a result, consumers have benefited with substantially lower fares and more routes across Europe and to the rest of the world. At the same time, EU airlines have maintained leading safety standards. The range and quality of services have increased and airline costs have fallen by 1 – 2% per year for the last two decades.

Lufthansa Group logo

We believe that this decline should now be matched by a reduction in those costs which airlines do not control themselves. “As the new Transport Commissioner prepares a new Aviation Strategy for Europe she must drive more competition, encourage more efficiency and help reduce costs in other parts of our industry (such as monopoly airports and Air Traffic Control providers) and reduce the tax burden on passengers.”

Aviation is a proven driver of economic growth and jobs. The proposed measures will create many hundreds of thousands of jobs – particularly for young people, at a time of high youth unemployment in countries such as Italy or Spain – and increase Europe’s GDP. The group will write to the EU Transport Commissioner Violeta Bulc asking for these measures to be put in place.

Ryanair logo-3

Alongside the proposed policy positions the five CEO’s confirmed their support for several key principles and action items which should underpin EU aviation policy. The most important of these is the commitment to safety and ensuring that safety standards are developed based on a risk based scientific assessment.

The CEOs confirmed their support for the liberalization of the whole aviation value chain and for pro-competition policy and regulation within the EU. They also confirmed their opposition to the provision of State-aid, as a general principle, to airlines and airports. They agreed that EU and national regulation and policies should support the efficient delivery of services, and that this includes the need for efficient operations to minimise the environmental impact of aviation. The importance of balanced consumer rights was also underlined; EU and national policies need to ensure that consumer rights are respected.

The CEOs agreed to work together to encourage the Commission and EU member states to take up the proposed measures. The five airlines agreed that airline representation in Brussels today is not as effective as it could be – with six airline representative organisations – and agreed to explore possible forms of future representation.

The five airlines between them carried a total of 420 million passengers in 2014, accounting for half of the passenger journeys in Europe.

IAG moves one step closer to acquiring a 25% share of Aer Lingus

IAG logo

British Airways (London) and Iberia (Madrid) parent company International Airlines Group (IAG) (London) has confirmed that it has reached agreement with Aer Lingus (Dublin) to make a €1.4 billion ($1.5 billion) (£1 billion) cash offer for Ireland’s national carrier.

Aer Lingus clover logo

The deal, which comes after months of negotiations, values Aer Lingus at €2.55 a share ($2.80 a share).

The board of the Irish carrier is recommending the offer, which was made after confirmation from the Irish government that it is willing to sell its 25 percent stake in Aer Lingus.

The decision of the sale was made at a meeting of the Irish cabinet late on Tuesday, which itself followed indications earlier in the day from Brussels that European competition authorities would not stand in IAG’s path.

Yesterday (May 28) IAG updated the Aer Lingus offer with this formal statement: CLICK HERE

Read more from The Irish Times: CLICK HERE

Assistant Editor Oliver Wilcock reporting from Manchester.

Copyright Photo: AirlinersGallery.com. Aer Lingus Airbus A320-214 EI-DEO (msn 2486) in the special Green Spirit – Official Airline of the Irish Rugby Team livery taxies at the home of IAG and British Airways – London (Heathrow).

Aer Lingus aircraft slide show: AG Airline Slide Show

Iberia to take early delivery of 8 Airbus A330-200s to speed up the retirement of the A340-300s

Iberia A330-200 (13)(Flt)(Iberia)(LR)

Iberia (Madrid) and Airbus (Toulouse) have reached an agreement over the early delivery of the A330-200s the airline ordered last year, which will now join the long-haul fleet 14 months earlier than initially planned, between December 2015, and November 2016.

The new aircraft will replace the older Airbus A340-300s.

The new twin-engine, wide-bodied aircraft, with a range of up to 13,400 km, consumes less fuel than the four-engine A340-300s they replace, and also generate less noise and air pollution.

The earlier delivery dates also speed the upgrading of Iberia’s entire long-haul fleet with the new cabins, fittings, and entertainment and communications systems, for an improved customer experience.

Iberia is currently renewing its long-haul fleet and also its long-haul cabins. In recent years the IAG parent has ordered 24 new long-haul aircraft for Iberia, the eight A330-300s delivered in 2013 and 2014; the eight A330-200s; and eight A350-900s to be delivered later.

Meanwhile, the company is retrofitting its 17 Airbus A340-600s with new long-haul cabins.

Image: Iberia. The first new Airbus A330-200 for Iberia will now arrive in December 2015.

Iberia aircraft slide show: AG Airline Slide Show

 

International Airlines Group reports higher earnings in 2014 due to Iberia turnaround

International Airlines Group (IAG) (British Airways, Iberia and Vueling Airlines) (London and Madrid) presented Group consolidated results for the year to December 31, 2014:

IAG period highlights on results:

Fourth quarter operating profit €260 million (2013: operating profit of €113 million) before exceptional items

Revenue for the quarter up 9.9 per cent to €5,015 million, up 5.8 per cent at constant currency

Non-fuel unit costs for the quarter down 0.8 per cent at constant currency

Operating profit for the year to December 31, 2014 of €1,390 million (2013: operating profit of €770 million) before exceptional items

Revenue for the year up 8.0 per cent to €20,170 million and passenger unit revenue for the year down 0.4 per cent at constant currency

Fuel unit costs for the year down 7.8 per cent also down 7.8 per cent at constant currency.

Non-fuel unit costs before exceptional items for the year down 1.9 per cent, down 3.9 per cent at constant currency

Cash of €4,944 million at December 31, 2014 was up €1,311 million on 2013 year end

Adjusted gearing up 1 point to 51 per cent and adjusted net debt to EBITDAR improved 0.6 to 1.9 times

Willie Walsh, IAG Chief Executive Officer, said:

“We’re reporting strong full year results with an operating profit before exceptional items of €1,390 million which is up 80.5 per cent. Total revenue was up 8.0 per cent with non-fuel costs up 7.0 per cent and fuel costs up 0.6 per cent on capacity growth of 9.3 per cent.

“Iberia made an operating profit of €50 million compared to an operating loss of €166 million last year. The airline’s turnaround has been remarkable, both financially and operationally, and we’re very proud of its achievement especially its strong cost discipline. In 2013 we said our intention was for Iberia to breakeven in 2014 and it has fulfilled that promise.

“British Airways’ operating profit increased to €1,215 million up from €762 million last year which shows significant progress towards its long term targets. Vueling made an operating profit of €141 million, compared to an operating profit of €139 million in 2013, with the airline focusing on flexible growth.

“We achieved a strong unit cost performance, down 4.1 per cent, through increased productivity, supplier cost savings and lower fuel unit costs. The latter was boosted by the introduction of more efficient aircraft into our fleet and lower fuel prices in the last quarter of the year. However, the positive effect of the oil price reduction has been partly offset by hedging and significant currency impact.

“In the quarter, we made an operating profit before exceptional items of €260 million which is up from €113 million last year. Revenue for the quarter was up 9.9 per cent. Non-fuel costs were up 10.5 per cent and fuel costs decreased by 0.4 per cent on capacity growth of 5.8 per cent.”

Copyright Photo: Iberia Airbus A321-211 EC-JQZ (msn 2736) taxies at London’s Heathrow Airport.

British Airways aircraft slide show: AG Airline Slide Show

Iberia aircraft slide show: AG Airline Slide Show

Vueling Airlines aircraft slide show: AG Airline Slide Show

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Is IAG’s seduction of Aer Lingus working?

International Airlines Group’s (IAG) (British Airways, Iberia and Vueling Airlines) (London) continued seduction of Irish flag carrier Aer Lingus (Dublin) seems to be finally working, as the airline is revealing the positives of a takeover by the owner of British and Spanish flag carriers British Airways (London-Heathrow) and Iberia (Madrid).

In a statement to The Guardian, Christoph Mueller, the clover-tailed carrier’s outgoing CEO says that Ireland’s entire economy will benefit if the International Airlines Group takes over Aer Lingus.

Mueller, who steps down as CEO of the airline this week, said IAG’s £1.02 billion (€1.4 billion) ($1.57 billion) offer to buy Aer Lingus would be the biggest single foreign investment in the Republic since the financial crash.

He continued that there was “a great deal of excitement” that Aer Lingus would be able to create jobs on a much larger scale if IAG took charge of the former state-run airline.

Mueller also stressed that talks between IAG and the Aer Lingus trade unions had been “very constructive”.

Aer Lingus announced on Tuesday that its profits had risen by almost 18% to €72 million ($81.6 million) from the previous year. Total revenue was up by 9.2%. For the first time in the airline’s history the number of passengers has exceeded 11 million.

On the hike in profits and the IAG take-over proposal, Mueller added: We profitably expanded our long-haul network utilizing our cost advantage and favorable geographic position and helped establish Dublin as the 7th largest European hub for transatlantic connections.

“Our short-haul business continued to demonstrate its resilience despite a highly competitive market. Commercial initiatives, in addition to cost control, led to the highest operating profit since the financial crisis and 17.8% above last year.”

Read more from The Guardian: CLICK HERE

Assistant Editor Oliver Wilcock reporting from Manchester.

Update: The Irish government late on February 24 stated it cannot accept the current offer from IAG for Aer Lingus. The government according to the BBC has raised concerns and wants more information before selling its share. Red the full report: CLICK HERE

Copyright Photo: SM Fitzwilliams Collection/AirlinersGallery.com. A takeover by IAG would lead to an updated fleet. Aircraft like this wet leased Air Contractors Boeing 757-2Q8 EI-LBR (msn 28167) would be phased out.

Aer Lingus aircraft slide show: AG Airline Slide Show

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Qatar Airways acquires a stake in IAG

Qatar Airways (Doha) has bought a 9.99 per cent stake in British Airways’ owner International Airlines Group (IAG), becoming the company’s largest shareholder.

The move will cement a close commercial relationship between BA and the airline, whose owner, the Qatari government, is a significant investor in Britain.

Willie Walsh, chief executive of International Airlines Group, the BA owner, said in : “We’re delighted to have Qatar Airways, one of the world’s premier airlines, as a long-term supportive shareholder. We will talk to them about what opportunities exist to work more closely together and further IAG’s ambitions as the leading global airline group.”

BA sponsored Qatar’s entry into the Oneworld airline alliance, and they also have a cargo partnership. Qatar has indicated it would seek to extend ties following the investment, which could include codeshares on flights via the Gulf state, allowing the airlines to sell tickets on each other’s planes.

Akbar Al Baker, the Qatar airline’s CEO said: “IAG represents an excellent opportunity to further develop our westwards strategy.”

Qatar Airways is prohibited from owning more than a minority stake in IAG under EU ownership rules and said it does not currently intend to increase its 9.99% shareholding.

Report by Assistant Editor Oliver Wilcock from Manchester.

Copyright Photo: SPA/AirlinersGallery.com. Qatar Airways’ second Airbus A380, the pictured A380-861 A7-APB (msn 143) completes its final approach to London’s Heathrow Airport, the home of IAG’s British Airways.

Qatar Airways aircraft slide show:

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