[AnthonyDunn]

@ transtraxman – 05/11/2012 14:58 GMT

Err actually, it showed that times move on but that there are some constants: “LHR operating near or at capacity”, restrictions on overseas ownership of US carriers, Richard Branson moaning about everything around British Airways, blah, blah, blah

It also showed that it is BA that routinely cops it in the media and elsewhere (like here….!) for just about anything and everything, factually based or not, fair comment or not.

[transtraxman]

AD
I do not understand your message.
What have capacity problems at Heathrow to do with a BA-Qatar linkup compared to a Qantas or AA – Emirates linkup?

RB is certainly a renowned moaner but has nothing to do with what I say.

I will say it again in other words. IAG lacks direction. It is in an alliance which means nothing compared to its two competitors. The OW components are each going their own way so what is the point of the alliance? The alliance´s future is far from secure as each member seems to be contemplating his own belly-button.

At this rate in two years time the alliance will be in the dustbin, and IAG with it to the lament of shareholders like myself.

[Bruce98]

Ah, but at least you get a free lemon on BA and your hairdryer travels, too.

[Henkel.Trocken]

And there was me thinking that the lemons were loaded for the crew to suck on during service time 😉

Does anyone really still use a hairdryer? I don’t and while there are several in the gym changing room, I’ve never seen one in use!

[BigDog.]

Walsh is set to make an announcement wrt buying the rest of Vueling tomorrow. Analysts are predicting 4,000 jobs could be axed at Iberia. IAG shares fell 1 percent today with Vueling up 25 percent.

A Credit Suisse analyst noted the depth of Iberia’s problems saying it could struggle to break-even at the level of operating profit by 2015. He said Iberia needed to cut its labour costs by Euro 300million or 15-20 percent of the workforce.

The dispute with its pilots continues, an attempt by the Spanish Govt. to mediate has failed so it is back to the courts.

Walsh should have had the stature to call off the engagement to IB before the nuptials then bought TAP as entree into the Latin markets, maintaining BA as a UK company. His decision to cement the tie BA to Iberia will continue to stifle the potential of BA for years.

[Bucksnet]

Agreed BigDog. I was against the IB merger from the start and pointed out the problems before it happened.

Bloomberg has just reported that IB is losing €1.7 million a day.

[JohnHarper]

I agree to. Any due diligence carried out on Iberia must have demonstrated they were a complete basket case and yet the deal still went ahead. They have been on my list to avoid for anything but shorthaul for years due to reliability and service standards.

And yet the deal still went ahead. Foolish in the extreme.

[Bucksnet]

Bloomberg are reporting 4,500 IB job losses.

[Henkel.Trocken]

Perhaps some of the interest in Vueling from IAG is to provide a base to do what LH have done with OS and effectively move the whole service to a low cost provider. Any IB staff who don’t want to go are made redundant and those who do work on new terms and conditions.

I’m not sure how Vueling would fit with Iberia Express which was created so recently. I do hope they are not creating a dog’s breakfast.

[BigDog.]

Oh dear, it doesn’t look good, especially as Walsh has continually reported a better picture than that which quickly transpired wrt both IB and the Spanish Economy.

http://www.bbc.co.uk/news/business-20264407

http://news.sky.com/story/1009108/ba-owner-iag-hit-by-iberia-performance

“Iberia is in (a) fight for survival,” the carrier’s chief executive Rafael Sanchez-Lozano said in a statement.

“It is unprofitable in all its markets. We have to take tough decisions now to save the company and return it to profitability.

“Unless we take radical action to introduce permanent structural change the future for the airline is bleak.”

If Walsh really wanted IB in order to meet his (flawed) goals, he should have at least waited 1-2 years for the inevitable fire-sale. Ineptitude in the extreme, costing BA stakeholders dear.

[Bucksnet]

Maybe that was the plan?

I thought they would be profitable on long haul what with their “unrivalled South American network” according to VK. But then again I proved in a subsequent post that their network is not ‘unrivalled’ and TAP flies to more South American cities.

[Deleted_User]

Only in Brazil Bucksnet. Apart from that, Caracas is the only city that TAP serves in South America.

[Bucksnet]

I know their route network, the point was they fly to more cities than IB.

Existing & new BA non-stops, TAP and AA from MIA to central America would be a far better route network.

[HonestCrew]

Is there a possibility Walsh went for the Iberia merger to stop one of the other major players (particularly AF/KLM and Lufty) getting their hands on them? Even though financially it was not the best idea.

Akin to Chelsea buying Fernando Torres.

[BigDog.]

Honestcrew, fair point, though remember Walsh was continuing a process started by a predecessor so IB was to all intent, pledged.

Also as CallMeIshmael – 06/08/2012 14:04 GMT posted

– The European competition authorities would never have sanctioned a European super airline. Adding IB to either LH/Swiss or AF/KLM would have created a dominant carrier to the detriment of all others European allegiances.

– The politics and strong national allegiance of LH and AF would never sanction the HQ and reporting of its national airline being moved to Spain as demanded, despite BA being the larger partner.

Unfortunately Walsh decided to complete the nuptuals despite there being obvious warnings that both the company, IB and the country, Spain were prime candidates for long term loss/recession if not melt-down.

As Bucksnet – 06/08/2012 13:09 GMT noted
A far better buy for BA would have been TAP, as long as its past debts were left with the Portuguese state.

TAP are number one to Brazil, which is the leading economy in South America, and could under BA’s management easily start routes to Uruguay, a former colony, and other destinations

… this would have been far cheaper and better for BA – who would have retained autonomy in the UK.

A subsequent fire sale of IB would have resulted in BA paying a far far cheaper price – if it wanted it at all! I doubt if AF/KLM or LH would have touched it with a barge pole especially with its recent BMI faux pas, let alone the competition commission never approving it, plus being preoccupied with their own not insignificant current restructuring issues.

IB will not just be a financial drain for years, but also a talent drain.

PS Honestcrew – Torres is at least useful, a beneficial asset.

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