Iberia strikeBack to Forum
- This topic has 37 replies, 15 voices, and was last updated 5 Mar 2013
at 00:15 by Ellwood.
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Demand for flights to South America has always been high.
Iberia value was around £3 billion. Five years worth of losses, restructuring costs and fleet upgrade (which apparently is even older than BA’s aging fleet) would eat a sizeable chunk from that.
The smart play would have been to buy TAP, keeping control in BA whilst access to the Brazilian market – a market which is as large as the next 5 largest South American countries combined. But Walsh wanted to be seen to be competing with AF and LH whatever the cost. Shackled to a corpse is a most apt description.
@ BigDog. – 19/02/2013 17:01 GMT
2. Just how have TAP’s route network, service offering and finances compared with IB’s I wonder.
Has anyone ever had the opportunity to put the question to WW and/or any other members of the IAG directocracy why they plumped for IB rather than TP? Or was it that TP was so far into bed with *A that any such discussions were not feasible?
I think that BA lost it when it reached agreement with Swiss to share routes and slots at LHR. It did not take the hint to invest, at least, in Swiss just when it was crying out for it. The result was the CEO of Swiss was displaced by an ex-LH man and the rest is history. That would have been the ideal partner.
It just shows BA´s attitude that it is so North Atlantic orientated because it did not learn from the experience. Air Berlin entered oneworld but has been ignored since then. It could have been an excellent vehicle for BA but has since fallen into the web of Etihad. Without doubt Air Berlin will eventually leave oneworld and join Skyteam.
Iberia was the last wallflower. It has great potential – more than TAP which was already in the clenches of Star Alliance. However, Iberia has wasted the last 5 years. It has does nothing to educate the public in the last 12 months so the battle with the unions is going to be very bitter with no public opinion on its side. Yesterday, when the striking members gatecrashed T4 at Barajas the working members (even non-striking BA, Vueling and AirNostrum) all disappeared leaving passengers to their own devices.
Spanish strikes can be very violent so do not be surprised if sabotage raises its ugly head. The end result – IAG will get its way but the legacy will be bad industrial relations. Maybe yesterday´s collapse of ORIZONIA – one of the biggest travel companies in Spain (tour operator, airline etc.) with 3000 job losses out of 5000 – might bring some reality into Iberia´s union´s discourse. I doubt it as their real objective is to bring down the government.
Interesting and troublesome times ahead.
@BeckyBoop – 19/02/2013 15:47 GMT
I am sorry to say this but you make the same mistake so many times it has become so irritating.
Your piece ended “….. should of increased.”
It should read “……should have increased.”
Good points transtraxman,
IIRC BA fell foul of investing in Swiss for the same reasons as they did with KLM and they set their own value too high.
Swiss would have been an excellent partner and it’s interesting to see how they have retained such a distinct style within the LH group with an all round reputation for great products and service.
The second tranche of 5 day strikes has started, with more to follow later in the month.
As El Periodico de Catalunya reports they are facing the worst recession for generations, meanwhile the level of corruption has exploded right up to their rulers and Royal Family hobnobbing with Russian criminals and living a high life from “donations” with judges and prosecutors complaining of being pressured… The problem is a culture of “patronage” and a collapse of public faith. El Pais (Madrid) reports 600,000 Spanish families without income or benefits.
Hippo views the Spanish situation as improving – it certainly does not appear the case. It will continue to cost BA/IAG dear with no end in sight…..
I recall a year ago Walsh stating on record that he believed Spanish economic crisis was more down to an adverse impression pedled by the press than reality – Clueless or badly advised or both? Traits one would not desire in a CEO.
BA has cancelled flights without notice…
although the Spanish Govt. has ordered a minimum service to be maintained.