The CEO of the airline group believes that the purchase of Air Europa would allow Iberia to catch up with KLM in the long-haul fleet.
IAG is managing to operate in this second quarter at 80% of the capacity of 2019. This represents an increase of 15 points compared to the January-March period and 22 points over the end of 2021, and between July and September it expects to reach 85% . These data show an even faster progress than predicted by the airlines themselves, as recognized by the CEO of the airline holding company, Luis Gallego.
“In the estimates that we project after the crisis, we fall short, demand usually returns with more force; that is what is happening now,” explained the chief executive of the Hispanic-British group in the dialogue he has had with Amparo Moraleda, independent director of Airbus, Maersk, CaixaBank and Vodafone, within the III EXPANSIÓN International Forum.
Iberia, IAG’s main subsidiary in Spain, has set itself the goal of attracting more premium customers, as a reflection of the country’s strategy to seduce tourists with greater purchasing power. Gallego explained that the recovery in business or premium is being faster among leisure tourists than corporate ones. And in the business segment, SMEs are beginning to fly more than large companies, with banking as a sector that already takes as many planes as before the pandemic. The recovery in premium is being faster in Iberia than in British Airways, which in March had, respectively, 60% and 45% of pre-pandemic income.
Within this desire to expand its intercontinental presence, Asia remains the largest market least covered since Spain, despite being one of those with the greatest potential. The current reason is the pandemic and the impossibility of entering certain countries, in addition to the war, but in the long term it is that Iberia is concentrated in America, so that the airline chaired by Javier Sánchez-Prieto will only be able to develop a larger network of connections to the Far East (beyond Shanghai and Tokyo) if it completes the acquisition of Air Europa.
“That is why we are trying to buy Air Europa, which would allow us to position ourselves with a fleet of 70 planes, like KLM, which would help us fly to more cities and have more important programming in Asia; today it is difficult to fly to certain destinations”, Gallego commented, reiterating that the acquisition of the Globalia airline would help create a quality hub in Madrid.
The Spanish executive hopes that, after receiving the Competition authorizations, IAG will be able to convert the 100 million loan to Air Europa into capital. “The next step is to reach 100%. If we reach an agreement for the purchase and the conditions [of Competition to get rid of flights on overlapping routes] are assumable, we will go ahead; if not, we will not be able to do it,” he added. In any case, the term shall not be less than 18 months.
