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Tag Archives: IAG

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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According to the BBC, Virgin Atlantic has filed an appeal with the European Commission to block the sale of bmi to IAG  (British Airways). Now the EC has already approved the sale, and Virgin Atlantic has already committed to bidding on all of the Heathrow slots that BA will be required to divest as a result of the sale.

My question is, will this sale EVER  go through?

What do you think, leave you comments below.

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The slow death is speeding up. Announced via e-mail on April 19th 2012 reward bookings will no longer be accepted for lufthansa group airlines. (Lufthansa, Brussels Airlines, SWISS, and Austrian Airlines). While not unexpected with the change of ownership this does confirm that bmi is transitioning out of star alliance. At what date that is set to occur depends on the the contract bmi has with Star Alliance.

As with the trend of loyalty programs what once was very generous is now not so much. Value in bmi was found in two places, their business class and first class redemptions and cash + plus miles. Now the levels are normalized with Miles and More (the LH program, though that will change) which were not so generous and the tack on fuel surcharges to tickets, which on long haul flights can be 500-700 added on the ticket. Quite a lot to pay for what is a “free” ticker.

Oh well AVIOS here I come.

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