3-Oct-2011 10:05 AM

Iberia may complement Vueling with a new LCC: reports

Iberia's board will meet this week to discuss the possibility of launching a new LCC that would take over most of the airline's short-haul network, according to a report in The Financial Times.

Iberia has been using Vueling, in which it has a 46% stake, to operate its short-haul feeder network, but the move has reportedly been met with mixed responses from Iberia clientele and its staff. Sepla, which represents pilots, believes Iberia is attempting to outsource all short-haul operations and warned its members are considering strike action. LCCs control about half of Spain's market, one of the world's highest levels of LCC penetration, according to OAG data. In the six months to 30-Jun, Iberia reported an operating loss of EUR78 million, while partner British Airways reported an operating profit of EUR210 million. Iberia launched LCC Clickair in 2006, but the airline suffered heavy losses and was absorbed by Vueling in 2009, which gave Iberia its current shareholding in Vueling.

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