Spanish carrier Iberia today disclosed plans to create a new network airline based in Madrid as part of a new strategic plan adopted by the airline's board of directors.
Iberia in a statement explains the carrier will be based in Madrid to feed and distribute traffic to its growing long-haul network.
The establishment of the carrier is part of a two-fold strategy Iberia plans to institute in 2011 to "allow it to be larger while simultaneously cutting losses", the carrier explains. The first tier of the strategy is growth in long-haul routes from Europe to Latin America where Iberia is the long-haul leader, the carrier explains.
The creation of the new carrier is the second portion of Iberia's strategy to address short and medium haul flying. The unnamed carrier represents "a change in the production model for these flights". Overall, Iberia is planning to further reduce seat count in those markets beyond what has been previously announced.
In August Iberia revised its 2009 capacity reductions upwards from 4.3% to 6%, and said it would withdraw three A320s from its operations in addition five short and medium-haul aircraft it has already grounded.
The carrier's board today also approved cost-cutting measures that include a hiring freeze for duration of its 2012 strategic plan. Other portions of the cost cutting scheme include a wage freeze for 2010-2011, lay-offs of flight attendants 55 and older and an expansion of previously-announced lay-offs to include 200 ground employees. Iberia cut 4.7% of its staff in the second quarter.
Coinciding with the cost cuts are plans by Iberia to re-launch business class, with a new "Business Plus" class on its long-haul routes.
Commenting on the new strategy titled "Plan 2012" Iberia COO Rafael Sánchez-Lozano says: "The airline industry has never experienced such a dramatic situation. It is essential for us to use imaginative means to transform Iberia into a sound and viable project".
Source: Air Transport Intelligence news
