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An all things aviation blog

Iberia subsidiary of the IAG holding company posted an overall 1.2 billion dollar loss for 2012. This is bad news for the Spanish carrier as they struggle with labor relations and higher fuel costs. CEO Willie Walsh told the BBC that the airline needs to adapt to survive. Some of the recent changes IAG has made to the Spanish carrier include outsourcing large portions of the route network to “express” carriers. I put express in quotes because the express carriers are running A320s for the Iberia brand. This actions engender the predictable result from Iberia labor.

While BA, the other IAG airline, is hardly a model of airline efficiency they certainly do a better job than Iberia. Iberia is one of those airlines that has cranked along due to government support and a near monopoly on air service. However, that has changed in recent history with large numbers of LCCs entering in the Spanish market. Legacy carrier SpanAir shut down about year ago after a last minute takeover deal fell through. While it is unlikely Iberia will go bankrupt and shut down, they risk ending up like Austrian Airlines a brand run by contracted carriers.

I had the displeasure of flying Iberia from New York City to Istanbul several years ago on a mistake fare ($300.00). The only mistake made was that I purchased the ticket, I decidedly overpaid and that I think sums up Iberia quite well.

Iberia, adapt or be gutted.

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