LEVEL enters Amsterdam Airport at the expense of Vueling

IAG's low cost brand LEVEL plans to operate four services from Amsterdam Schiphol starting in Apr-2019. The routes are to London Luton, Rome Fiumicino, Valencia and Vienna and will be operated by LEVEL Austria with A321s.

After Vienna, Amsterdam will be the second short/medium haul base for LEVEL and the second where its growth is at the expense of its sister company and IAG's other low cost brand Vueling. On three of the Amsterdam routes LEVEL is replacing some or all of existing Vueling operations. In a further ironic twist, LEVEL Austria is operated by Anisec Austria - itself legally a subsidiary of Vueling (although not organisationally).

Vueling does not make IAG's target return on invested capital of 15% (it made 13.3% in 2018 after six quarters of no improvement). The latest development reflects the group's policy to allocate capital where it can generate the best returns.

IAG also appears to be confirming once again that it has dropped any interest in acquiring Norwegian, preferring to develop LEVEL in both long haul and short/medium haul low cost markets. LEVEL's new services at Amsterdam, which has greater LCC penetration than any other major Western European hub, are likely to be followed by long haul routes.