Another Merger? Iberia-BA

bits44 · Post by **bits44** » 25 Jul 2005, 13:36

http://www.regionalhub.com/?a=1&id=2877

hvv · Post by **hvv** » 25 Jul 2005, 17:29

Interesting. It doesn't surprise me that they start to mention a BA-Iberia merger as a possibility, as the Air France-KLM merger has so far been more successful than a lot of people had expected (and possibly hoped). I also expect a Lufthansa-SWISS merger at some future date.

Apologies if the following has been discussed before on Luchtzak, but I couldn't easily find it:

It will be interesting to see what will remain of the incumbent airlines in a few years' time in Europe and North America (Asia too, but I suspect regulatory boundaries will take longer to disappear there, shielding national airlines to some extent).

In the US, it seems there are too many major carriers, looking at the financial situation of most of them. So, how many could be viable, you think? I also wonder where it leaves Air Canada eventually.

In Europe, the trend seems to be to have one dominant major carrier (Air France, BA, Lufthansa) in each of the alliances (Skyteam, Oneworld, Star Alliance). Other airlines are linked to one of those three major carriers in the form of mergers (such as KLM) or feeder/regional airlines (such as LOT). Remaining airlines (such as Olympic) could face tough times in such a competitive environment, as artificial regulatory barriers start to fall away. The alternative is to find some kind of niche. Maybe Icelandair is an example of that?

I'm interested in opinions (for instance, how will airlines try to survive) - and sorry again if this has been discussed to death before.

Hans.

yagoceron · Post by **yagoceron** » 25 Jul 2005, 17:41

There have been merger talks for ages. Don't forget BA owns a very small percentage of Iberia.

Personnally I don't know why would anybody want to merge with a company so badly run like Iberia but who knows

SR89 · Post by **SR89** » 25 Jul 2005, 20:09

It's a no-brainer.

IB definitely owns the traffic to Latin America while BA is a real trail-blazer on routes to/from North America.

They'd complement each other quite well.

Atlantis · Post by **Atlantis** » 25 Jul 2005, 20:09

There was also launched an idea for an alliance between Iberia and Vueling.

Iberia want to decrease it's flights in Barcelona and the are thinking to create a new LCC in Barcelona.

But the government of Catalonia wants an alliance between Iberia and Vueling to create a big LCC in Barcelona againts Ryanair and other LCC.

SR89 · Post by **SR89** » 25 Jul 2005, 20:12

Atlantis wrote:There was also launched an idea for an alliance between Iberia and Vueling.

Iberia want to decrease it's flights in Barcelona and the are thinking to create a new LCC in Barcelona.

But the government of Catalonia wants an alliance between Iberia and Vueling to create a big LCC in Barcelona againts Ryanair and other LCC.

This long-time rumoured LCC out of BCN was officially launched last week.

http://news.airwise.com/story/view/1121941192.html

Vinnie-Winnie · Post by **Vinnie-Winnie** » 25 Jul 2005, 22:48

It makes no sense for Iberia to launch a low-cost company! As previously said Iberia isn't really the best managed airline! Every day you hear people complain about Iberia( Lost luggages, bad service, frequent delays..) If it were to launch a low cost company it should first of all try to sort its own problems!

Back to the BA-IB merger... I think both would certainly benefit! BA could bring its expertise in controlling costs and making revenues . It has been one of the best run airlines in the world since privatisation so sure it has some experience to bring to lucky iberia who has found such a good niche that it has avoided the same fate as Alitalia and Olympic. Iberia could bring its expertise and its cloud in the spanish market...

Imagine a BA-IB merger they would probably become the kings of europe to america routes! Air France-Klm Lufthansa-Swiss be warned better start lobbying the EU soon for some restriction on this soon to happen merger

:mexwave:

sn-remember · Post by **sn-remember** » 26 Jul 2005, 14:23

IB certainly does not need BA to implement a better management; it can perfectly do it on its own.
As already stated the 2 airlines are complementary on the Americas but is this a good reason for a merger ?
Both airlines are viable as such in the near future and currently making profits.
So what would the benefit be for each of the carriers which already cooperate inside the OW alliance ? Certainly it could provide more strength to face the AF/KL and LH/LX competitors. And therefore it probably makes sense...

However concerning the suggestion there are too many airlines in the US skies , I don't agree. If I follow the reasoning well, as long as airlines are in the red, the competition being too strong, some of them should disappear... But that happened already in the past decades leaving only a handful of surviving airlines. If this tendency goes on, there will be only 1 airline left in the US, an american counterpart of the soviet age aeroflot !!!

Post by **luchtzak** » 26 Jul 2005, 22:09

yagoceron wrote:Personnally I don't know why would anybody want to merge with a company so badly run like Iberia but who knows

Badly run? I think Iberia is still presenting good figures, load factors are high and they keep on buying new and modern planes (A320, A340-600, etc...). Besides their 'monopoly' in South-America is amazing!

Perhaps some passengers are not happy flying Iberia, yet the aircrafts are filled average 77% (June 2005-figures) or 75% from January to June 2005.

Besides I only hear that Iberia has positive results

When British Airways want to merge with Iberia BA will have to come forward with a good bid.

In my opinion BA will not merge with Iberia anyway but who am I ?

hvv · Post by **hvv** » 28 Jul 2005, 13:00

None of my Spanish colleagues likes Iberia (though some will defend it when it's compared poorly with other airlines

), and one of them always takes the LANChile flight from Frankfurt to Spain! I can't judge, as I've never tried them!

Hans.

Buzz · Post by **Buzz** » 29 Jul 2005, 00:40

yagoceron wrote:Don't forget BA owns a very small percentage of Iberia.

9% I believe...

Buzz · Post by **Buzz** » 29 Jul 2005, 00:41

hvv wrote:I also expect a Lufthansa-SWISS merger at some future date.

Nothing to expect, they will merge as soon as they get aproval to keep Swiss' landing rights etc...

Vinnie-Winnie · Post by **Vinnie-Winnie** » 29 Jul 2005, 09:06

Would be nice if there was finally some open-sky agreement between the US and the EU! This would certainly accelerate mergers between european airlines!

Problem is though when we will be left with 5 big groups won't there be some kind of oligopoly?