BA/Iberia…Time to split?

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  • HarryMonk
    Participant

    Another day, another subject, another pi55ing contest

    Guys, about doing away with the snide remarks and sticking to the subject. I find some of the subjects can be quite interesting and factual once I step over much of the dogs mess on the virtual pavement that these threads can become at times


    FormerlyDoS
    Participant

    Wikipedia is not a recognised reference.

    Half of it is great, the other half is dross and the problem is that most people don’t know which half is which, as they are not experts in the area.


    austline
    Participant

    A few weeks ago I had to fly to Accra, I had been on Bristol on business and instead of heading back to LHR I decided to fly on Easy Jet to Madrid, you get what you pay for but with seat selection and SB for a 100minute flight it was good value. Stayed overnight at the Hilton, very nice hotel and then picked up IB the following afternoon.

    The check in was okay, I was one of 3 pax in J, the lounge at Barajas was quite good but the flight was very disappointing. The cabin crew very average, I really don’t think they wanted to be there. The seat was the old cradle style. The food was dreadful, to say the least, and more than once I had to get up and replenish my own glass of very average wine.

    Frankly I have had better service in Y class on CX/QF/SQ.

    If IB is going to survive they need a really good dose of WW medicine and the front line staff lessons in customer service. No passenger in their right mind would spend thousands of dollars and fly on this carrier. It is a pity as travelling via Madrid is very convenient if you are going to Africa or South America from many cities in the UK and Europe, if they don’t change, I fear that they will not be around for long in this new and very competitive world of aviation.


    Str8Talking
    Participant

    I have only ever flown on Iberia once, on a hop from Madrid to London which was pretty uneventful. I have avoided their longhaul business class mostly because of the hard product.

    I am, however, (by the sounds of it) probably alone in saying that I am looking forward to their new product and pleased to already hear positive comments about the A330-300. I would be quite happy to try it heading to Central and South America.

    The way I see IAG shaping up is Vueling will take over as the “low cost leisure” branch, possibly taking over a lot of the routes from Gatwick. That way BA can differentiate between their business and leisure product using two different brands, while at the same time bringing IB up to a good standard. It is interesting to see the launch of routes such as LHR-FLR by Vueling!

    Wishful thinking? Time will tell. These are not things that change overnight.

    I have a feeling that all the loss-making announcements are carefully timed to coincide with current action at IB. I wish it was possible to fix all the economic problems without cutting jobs, but I think that’s not really feasible.

    I look at government owned airlines, and in particular, Cyprus Airways, where the Cypriot government has been forever trying to find loopholes to pour money into a failing system. For many years, Cyprus Airways staff, essentially as civil servants, treated passengers with contempt, as if they were nothing but nuisance and that the staff were worthy of celebrity status just for being Cyprus Airways workers! Is that the sort of motivation needed to make a good airline? I don’t think so. How do you change that mentality? It gets much trickier when dealing with a different culture altogether – and that is what it boils down to in the end, cultural change!


    JohnHarper
    Participant

    I agree with the very valid point made above by CXDiamond. Those of us who are labled anti-BA on this forum are in all probability not.

    I certainly am certainly in favour of it being a soundly structured, competitive company but there were and are far better ways to go about this than what Walsh did.

    I am a BA shareholder so why would I want the company to do badly?

    I want it to do well but it has not been well managed for at least ten years. I know enough to know how to restructure a major organisation and take the workforce with me, there are a tiny minority who won’t budge but at BA this was managed so badly that many staff were alienated from the company and each other.

    I want back the aspirational company BA was when first privatised when they really were the world’s favourite airline and it was great to fly them. Creating that requires vision and innovation and it’s clear that Walsh has neither of those things and to hear his on-going mantra about reducing costs while taking a £1.7m bonus makes me want to scream.

    BA needs a complete clear out of managers and some fresh blood and thinking.

    It may be an opportunity to bring together the IAG more fully and with the right managers they could be a force to be reckoned with.

    If more of the same is the way forward you will end up with Europe’s third largest carrier having a disaffected workforce and problems as a result that will last for years and years.


    AllOverTheGaff
    Participant

    I mentioned recently about how discussing BA always seemed to descend into farce, something else struck me about BA discussion topics on this board:

    Hippocampus – 06/03/2013 15:15 GMT
    So much nonsense from the anti-BA agenda on this thread.
    04/03/2013 21:09 GMT
    rferguson writes a lot of sense amongst the usual nonsense from the anti-BA agenda.
    02/03/2013 18:54 GMT
    No, the anti-BA agenda is wrong. The shares closed up on the day of the results and are still up.
    27/02/2013 21:13 GMT
    Usual nonsense from the anti-BA agenda in this thread.
    02/02/2013 20:30 GMT
    Unsurprising comment from the anti-BA agenda!
    20/01/2013 20:57 GMT
    Whatever it does, the Victor Meldrews and anti-BA agenda will never be satisfied.

    Rather begs the question: What is on the anti-BA agenda?
    Regards.
    AOTG.


    AllOverTheGaff
    Participant

    AnthonyDunn – 06/03/2013 19:05 GMT
    As opposed to what? There really are some pompous asses on this site.

    I choked on my lunch when I read that.

    Rgds.
    AOTG.


    christopheL
    Participant

    AllOverTheGaff- 07/03/2013 13:41 GMT

    Discussing BA on this forum is the same as discussing same-sex wedding in France. Definitively impossible 🙁 🙁


    BigDog.
    Participant

    Terry, Anthony – the IB Union issue is a (small) part of the problems facing IAG

    The Spanish Political class, Illuminati as well as chattering classes, appear unanimous in their opposition to the decimation of Iberia by Walsh. In typical thuggish style, “slasher Walsh” appears oblivious to the increasing view IAG is assaulting the national identity and self-interest of Spain.

    As the FT noted …
    For policy makers in Madrid, it is unthinkable that there should be fewer direct flights between Spain and Latin America. These routes represent in no small degree Spain’s ticket to world influence. Yet IAG is halting direct Iberia flights to Santo Domingo (Dominican Republic), Havana (Cuba), Montevideo (Uruguay) and San Juan in Puetro Rico

    Jose Manuel Soria, industry minister complained “To me it seems unacceptable that, to go from Spain to Havana, we have to go through London”

    It concludes..
    Spain rightly expects a full set of routes to Latin America. But there is no compelling reason why Iberia, in or out of IAG’s control should run them.


    VintageKrug
    Participant

    Something of an obsession with Walsh, n’est ce pas. Unhealthy.

    With compelling fares in the latest sale, and a new fleet of A380s being delivered there’s plenty of good news at British Airways and IAG:

    http://www.britishairways.com/travel/low-price-finder/public/en_gb

    I watch RTVE news every evening, and even I have noticed a radical change in the past few months after Pepa Bueno disappeared.

    In a recent article in El País (28 February), viewing figures have dropped by 2 million. At the end of 2012 at the time of strike threats, there was barely a mention.

    The opposition accuses TVE of being ‘sectaria’ and ‘al servicio del Gobierno’ (the ruling PP).


    transtraxman
    Participant

    alexpo1 @11.53GMT
    You do not explain yourself.

    Neither “RTVE” nor “El Pais” are independently reliable sources. With 30 plus TDT channels you now have a broad spectrum of independent news sources to reach an evaluated opinion of your own.

    One common element is that BA is blamed.(This is an old tactic used over the years, to blame the foreigner.) The Spanish media takes the viewpoint of the unions that BA is trying to dismantle Iberia – a simplistic xenophobic attitude – and grab all the lucrative premium traffic (as if it were so simple).

    This is obviously a tremendous lack of communication from the (Spanish) directors of Iberia to public opinion. Iberia´s problems run very deep and the solution in these difficult times means somebody has to take a lot of stick – which nobody in Iberia is prepared to do. So IAG will have to take a bigger role and brave the storm. Hair will have to start flying soon.

    As an addage. The financial newspaper “Expansion” today cites the board of Vueling rejecting the takeover offer of IAG @€8 per share(a 27% premium at the time) as being too low. IAG´s strategy relies to a great extent on that acquisition so the analysts say that the offer will have to be improved somewhat even to achieve a 51% holding from the 45.85% at present.

    Interesting times ahead. Difficult for Iberia and very challenging for IAG. This is just when TAM announces its integration into oneworld and consolidating oneworld´s hegemony into South America.

    Good evening transtraxman

    Thanks for your post.

    As an outsider, I am trying to understand how this merger has reached this stage. Of course El País is not an independently reliable source but the quality of its journalism is not in question. I’m sure you will agree.

    Do you think LATAM’s integration into oneworld will be yet another blow for Iberia?


    AnthonyDunn
    Participant

    CXDiamond/AOTG: skip to next post.

    @ BigDog. – 08/03/2013 11:16 GMT

    As an FT subscriber, I had seen the article and the comments from the PP Industry minister. You also wrote:

    “The Spanish Political class, Illuminati as well as chattering classes, appear unanimous in their opposition to the decimation of Iberia by Walsh. In typical thuggish style, “slasher Walsh” appears oblivious to the increasing view IAG is assaulting the national identity and self-interest of Spain”.

    You don’t opine on whether you think that the Spanish chattering classes/illuminati etc. would be happy to witness the collapse of IB owing (a) to Spanish travellers voting with their wallets and feet onto Flyanscare and Vuelling (b) the refusal of IB’s unions and workforce to agree the necessary measures to return the company to solvency and (c) the company literally running out of cash?

    Maybe you are right that IAG/BA is getting in the way with its cash resources enabling IB to continue flying. So if IAG/BA were to walk and let the Spanish do the dirty work of bringing IB to its knees on their own, untrammelled by Slasher Walsh and the “British pirates”… do you think that the Spanish would be any happier with their sense of national identity and Spanish national interest intact? BTW, the Spanish government is specifically prohibited from a bailout and the Spanish banking sector is not exactly awash with cash right now either.

    This might read as my being facetious but you have invited this riposte because what you are effectively saying is that “it’s nonsense but because it’s Spanish nonsense, it’s entirely understandable…”

    Because I respect your opinions, experience and judgement – and because you deplore what WW/IAG is doing – I feel obliged to ask just what would you do (rather than what might you have done)?


    BigDog.
    Participant

    Anthony,
    Because of the long term dire situation of the Spanish economy (which IMO could well necessitate exiting the Euro) coupled with the Latin/Med culture of heavy state control/influence/ownership/interference I would endeavour to split IB from BA.

    Pandering to the Spanish national interest by maintaining its international influence via a plethora of (loss making) routes to Latin American countries for the forseeable future, is clearly not a viable way forward for a listed company.

    Transtraxman, who appears to have a better insight into the Spanish market, makes an interesting but not unsuprising point…
    ” obviously a tremendous lack of communication from the (Spanish) directors of Iberia to public opinion…
    So again IAG seniors have done little to win hearts and minds preferring to emulate the thuggish style Walsh used with BA crew. Lacking one iota of emotional intelligence, it appears the route one of direct confrontation approach following a cursory attempt at adult communication is much preferred over a winning friends and influencing people approach to win hearts and minds.

    Additionally Walsh has hamstrung the company by not having restructured the BA pilots also crying wolf in court when restructuring its cabin crew – neither will go down well when played to the Spanish judiciary.

    Interestingly although Hippo views LATAM being a good thing for oneworld (which it is) but also good for IAG specifically. A view not shared with the FT Airline editor who views LATAM as an up and coming competitor to IAG – specifically IB methinks.

    Not having an ego requiring validation, I would therefore cut my losses and try to demerge. Chrysler/Mercedes and Newscorp managed it and created shareholder value to boot.

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