BA/Iberia…Time to split?

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  • transtraxman
    Participant

    This report was supported by one on Reuters……..
    “Los sindicatos de Iberia desconvocan la huelga de la próxima semana”
    miércoles 13 de marzo de 2013 15:19 CET
    meaning ………. (Iberia´s unions call off the strike for next week”)

    The article also mentions SEPLA, the pilots´union, which does not support the agreement. They can still cause a lot of trouble but in my view will be obliged to accept the agreement eventually.

    Thus a satisfactory end to the dispute. Let us hope IAG and its component parts get down to improving the business and providing a decent shareholder return.


    TominScotland
    Participant

    Anastasia – your posts would do credit to your Romanoff princess namesake!

    “Off to Heathrow soon. I just hope my assistant gets their on time. Someone has to get this bag up in to the overhead.” – I just wondered what it was belonging to your assistant that you hope they get on time – haircut? Big Mac? flu jab?

    Or did you mean “Off to Heathrow soon. I just hope my assistant gets there on time. Someone has to get this bag up in to the overhead.”?

    One cannot be too particular about grammar, you know……..


    VintageKrug
    Participant

    I don’t think it’s quite over yet; IAG has successfully taken a hard line.

    Once the union engaged IAG has demonstrated, as it did in London, that it is capable of negotiating a compromise which delivers what it needs, while allowing the Union to save face.

    While the Iberia situation is more stark than was the case with BA (with actual involuntary redundancies) IAG is emboldened by a wildcard in the form of being able to shut own the airline due to bankruptcy, and the fact that is a worse option for most of the employees makes a compromise more likely.


    BigDog.
    Participant

    Successfully taken a hard line. You are having a laugh.

    Great it is moving to towards resolution but at huge cost.

    In November IAG were making a public pitch for 4,500 redundancies – “to guarantee survival”, 3,800 was their fall back, they eventually had to settle for 3140.

    http://uk.reuters.com/article/2013/01/02/uk-iberia-pilots-idUSLNE90101920130102

    It is evocative of when Tony Blair surrendered the UK EU rebate with the true impact kicking in later.

    On top the redundancy package wasn’t 20 days salary per year worked, as IAG negotiated, for but 35 days – 75% more.

    So altogether more long term fixed costs and a higher severance cost – so much for the Walsh medicine. .

    Having said all that – it was always going to be the case, pity Walsh didn’t realise it sooner.

    Good that it looks as though Walsh has achieved a 40% reduction in starter salary of pilots, he now needs to do similar with BA pilots.

    http://elpais.com/elpais/2012/12/27/inenglish/1356638396_502634.html

    So overall good for Iberia employees, but another huge kick in the teeth for original British Airways shareholders who saw Walsh grossly overpay for Iberia in the first place and have then had to watch a further £1 billion in value wiped off.

    With the Spanish government, through its ownership of Bankia, being IAGs largest shareholder (12% methinks) there will still be a fair amount of state influence.


    Hippocampus
    Participant

    IAG has got what is was seeking which is structural change at Iberia.

    The devil is in the detail. The number of job losses may have been reduced and terms for redundancy improved, but this will be offset by measures to improve productivity.

    This is a big step forward. Some of IAG’s biggest critics should look at what they were saying only days ago.


    Henkel.Trocken
    Participant

    We all know that Walsh can cut costs, he cut them so much at Aer Lingus there was virtually no company left. There is a fine balance to costs and quality, when you cut costs, you inevitably cut quality and in the case of Iberia, there isn’t much quality to cut.

    What is really needed is someone who has some management skills and not just a frustrated bean counter with an ego problem.

    Troubled waters lie ahead. This is no victory.


    BigDog.
    Participant

    If you weren’t so financially naïve, I would reckon you were one of those long-gone industrial financial advisors hauled over the coals for mis-selling.


    AnthonyDunn
    Participant

    @ Henkel.Trocken – 13/03/2013 17:00 GMT

    Please see:

    http://corporate.aerlingus.com/companyprofile/history/
    http://corporate.aerlingus.com/companyprofile/fleet/
    http://corporate.aerlingus.com/companyprofile/routenetwork/

    The fact that EI was successfully floated in 2006 (after WW walked out, having had his MBO proposal rejected by the Irish government), has a fleet of 42 aircraft of which 25 it owns itself, has a series of strategic and regional partners – and has been the M&A target of O’Blarney not once but three times – tends to indicate that your comment

    “[WW] cut costs at Aer Lingus so much that there was virtually no company left…” is somewhat at odds with the verité.

    As your comments about BA/IAG/WW are now so utterly predictable, we could take them as read without a constant repetition. How about a new bone to chew on? He didn’t chuck you off a flight when he was an EI pilot did he?


    BigDog.
    Participant

    The Iberia pilots appear to be still holding out for improved terms for themselves.

    http://www.bloomberg.com/news/2013-03-13/british-airways-parent-iag-says-unions-agree-iberia-job-cut-plan.html

    Walsh is between a rock and a hard place with the pilots as he failed to restructure the BA ones appearing to treat them and BALPA particularly as a special case.

    If he continues this approach with Iberia, the other Unions may renege on their verbal agreement and lobby for further concessions themselves. One hopes the IB pilots see the bigger picture and settle as the others appear to have.


    DavidGordon10
    Participant

    Meanwhile, with a “must arrive” flight to Madrid coming up soon I will book with KLM to be as near certain as possible. Disputes causing uncertainty lead to short-term and eventually long-term loss of business.


    transtraxman
    Participant

    Well somebody has certainly split here.

    The chief executive of Iberia has been eased out to be replaced by the chief executive of Iberia Express. That in itself says a lot. But expect big changes in Iberia in the next twelve months – at last!!!
    Reported today on IAG´s website.

    http://www.es.iairgroup.com/phoenix.zhtml?c=240949&p=irol-newsArticle_Print&ID=1800899&highlight=

    Also reported today in Travel Weekly …..

    http://www.travelweekly.co.uk/Articles/2013/03/27/43588/iberia-boss-steps-down.html


    JohnHarper
    Participant

    Just because the CEO has been booted out it doesn’t necessarily follow that there will be significant changes. This is Spain we are talking about and the Spanish trade unions.


    transtraxman
    Participant

    I disagree. Not all Spain is a mess. Not all Spanish companies are badly run by far. Look at the Mondragon Co-operative. The Basque run industries/banks tend to be better than the norm.
    CAF – the railway construction international giant is well run and could and does give many British and foreign firms a good run for their money.

    Spain is not Madrid nor Andalucia, the Basque Country and Cataluña give great added value to the Spanish economy. The Trade Unions are anchored in the 19th century. Respect the differences and you will see the results coming from those regions.


    BigDog.
    Participant

    Transtraxman raises valid points.
    IMO there is little love lost between the “autonomous” Spanish regions and the capital. The love for Madrid from the regions is comparable with the love the Scottish parliament has for London.
    Would the Basque Country and Cataluña therefore prefer a strong IB or have their own carrier?
    No wonder IB is desperate to ensure the Vueling (Barcelona/Cataluna) buy-out occurs but they will pay a high price.

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