[LuganoPirate]

Anthony and BigDog make a few good points but I also think it’s good to look at history to see what could happen.

First, what would happen if IAG divested itself of Iberia? I think the shares would go up as the group saves itself €3m a day. But who would buy it? The Spanish government can’t, the banks don’t have the cash. The Americans don’t need them, LH, AF etc wouldn’t or couldn’t! IAG’s only option then may be to put it in liquidation. The most likely scenario to then follow is the Spanish would nationalise the carrier then sue IAG for untold millions.

We don’t have to go far back in time to look at a similar situation when Swissair took over Sabena. Two much smaller airlines but nonetheless Sabena was riddled with losses and union problems similar to Iberia. To add to its woes Swissair could, under then EU rules, only buy 49% with the Belgian state having the other 51%. Politics thus interfered in many of the decisions Swissair had to take.

Sabena’s (along with two small French carriers with similar problems) losses and the cash needed to keep them afloat where just too great with no real way out other than bankruptcy which is what happened. 9/11 and the immediate strike by Sabena pilots thereafter both compounded and was the catalyst for this to happen.

IAG beware!

[AnastasiaBeaverhouzen]

In my very humble opinion, forget the personalities (though Wille awarding himself £1.3 million in shares as a bonus seems a little rich), this entire Iberia project makes sense in the long run. WW fought it out with the unions here and won in the end. The Spanish market and nation is in the doldrums. If they force the changes and keep pushing Iberia to comply eventually if they can wear their way through it, they will prevail. Besides which the purchase of Vueling the grinding crushing of opposition at Iberia will be less and less painful.

Iberia is like my overgrown bush when it needs a damn good trim and let’s face it with flights to the South American market booming in the coming years, a good Brazillian route is worth it’s weight. Iberia will bring benefits, in the end, they don’t have a choice.

[BigDog.]

Hi Karen or is it Megan 😉

No disrespect but your post did have me in a fit of giggles – intentionally on your part methinks.

Wrt the subject at hand, I think the similarities between the problems BA and IB were merely, though not insignificantly to do with intransigence, there are far more serious differences.

– BA the industrial action was around mainly cabin crew v IB it is virtually the whole company.
– BA received tacit support from a remote/hands-off UK government whereas the Spanish government, who have a history of state influence/interference, view IAG as assaulting national interest.
– BA no compulsory redundancies. IB redundancies 20% plus very expensive to do.
– UK Judiciary/laws favour employer, Spanish Judiciary/laws favour employee.

The IB situation further exacerbated by IAG perceived as reneging on assurances given to IB pilots and IAG having cried wolf previously.

Please give my regards to Martina if you are still on good terms with her and take care with those secateurs. I look forward to further posts from your good self.

[AnastasiaBeaverhouzen]

In the end I’m firmly of the belief that IAG will win out, it will be costly in terms of time and money and political favours with the Spanish government may not be forthcoming. Not that it matters because inside the EU they can do little to affect Dubyadubya’s long term agenda and he knows it. As We speak Vuling will be consumed and the end will be IAG will have the Catalan government fighting on their side against Madrid. It never needs a reason to want to have a go. BA Iberia and Vuiling will be tied by a Gaudian knot. Martini anyone?

[AnthonyDunn]

After advice on topiary and how to fix IB, how to mix a Martini! ABH, you’re veritable Renaissance woman…

[AnastasiaBeaverhouzen]

IAG posted a notification this morning advising they had accepted Spanish mediation. No other details. Haven’t had time to look yet by portable Martini kit is being packed ready for the trip on Virgin.

[TerryMcManus24]

IAG has accepted a government-appointed mediator’s compromise for an end to its dispute with Iberia staff.

“The board of International Airlines Group has met today in an extraordinary session to analyse and assess the proposal issued by a mediator regarding Iberia.

“As a result, the board has decided to accept the proposal,”

The Spanish mediator proposed Iberia lays off 3,141 workers, instead of the 3,807 the airline had planned to let go, with severance pay of 35 days per year worked, rather than 20.

The unions have yet to say whether they accept the proposals. The mediator will meet with worker representatives today.

Iberia workers went on strike February 18-22 and March 4-8 and have planned a third one-week strike for March 18-22.

They have also threatened to strike again during Easter week.

Struggling to compete loss-making Iberia also had also announced plans for 20% salary cuts for its remaining 16,000 workers while the mediator has proposed 15% reductions.

During the two week-long strikes by pilots, air stewards and ground staff, Iberia cancelled about 10% of flights to the United States and Latin America and 50 percent of flights within Spain.

The company is losing 3 million euros a day during these strikes.

[esselle]

35 days is at the high end; until recently, 45 was the standard, but many deals are being done currently at sub 30.

[Bucksnet]

I thought IB was losing 3 million euros a day when operating normally!

[NameRemoved-18/12/14]

Yes Terry, a decision is expected on Wednesday.

[BigDog.]

It looks as though it will be accepted.

http://www.telegraph.co.uk/finance/newsbysector/transport/9921789/IAG-accepts-mediators-plan-to-end-Iberia-labour-dispute.html

So the merger valued IB at around £2.6 billion.
Costs, losses, write-offs and redundancy will be around £1 billion.

Way to go Walsh, having destroyed a quarter of a billion in IB goodwill, his failure to push for IB restructuring prior to merge has cost BA shareholders very very dearly.

Losses/Pay Offs/write offs £1 billion to settle will only go part way as the current Spanish govt. becomes more interventionist to protect the national interest.

[BigDog.]

I guess seeing no money is coming from Walsh’s pockets/bonus he has had no problem spending £1 billion fixing his costly mistake. If you pay enough you can pay for any problem to go away.

So much for the Walsh medicine.

[Hippocampus]

Where does the figure of £1billion to settle the dispute come from?

[BigDog.]

Willie’s IB adventure has cost shareholders £1 billion to date.
Iberia losses 2011 €220 million
Iberia losses 2012 €351 million
Iberia impairment €343 million
Iberia redundancy €150 million

Again VK I find your snipes and pomposity tedious so I repeat the challenge. I am happy to meet with Martyn Sinclair and show him all my credentials which can then be checked against claims I have made on this forum. As Martyn has frequently backed you, I challenge you to do the same with Martyn vis-a-vis your alleged extensive travel, FFP and hotel statuses, business. Then let Martyn report back to the forum as to whether or not our various claims hold water.

Time to put up.

[HarryMonk]

A card off – lol

I’ve got one star alliance gold, hilton gold, tesco blue stripe and will raise you 74 argos premier points

[Author]

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