The new chairman of Iberia, Spain’s national airline, vows to complete stalled merger talks with British Airways that would create a million-tons-a-year cargo carrier.
“I’ve come to Iberia with the objective of closing a deal with British Airways,” Antonio Vazquez told Cinco Dias, a Spanish business newspaper. Negotiations “cannot go on for much longer.”
A merged Anglo-Spanish airline would have a million tonnes-a-year cargo business based on 2008 traffic – BA handled 777,000 metric tons and Iberia 242,000 metric tons – and would be the biggest operator on Europe-Latin America routes.
But it would remain in third place among scheduled European carriers, with just over half of Lufthansa’s 1.92 million metric tons traffic in 2008.
Vazquez was named in early July as successor to Fernando Conte who stepped down after seven years at the helm of Iberia amid media reports of pressure from shareholders to revive negotiations with British Airways.
Merger talks were slowed over concern about BA’s $2.8 billion pension deficit and differences over each carrier’s stake in a merged airline following sterling’s slide against the euro and share price movements of the two airlines in the past year.
BA, which has a 10 percent equity stake in Iberia, originally wanted a 65 percent share in the merged airline, but is now prepared to accept a 50:50 split, according to Spanish press reports July13.
BA and Iberia are currently seeking antitrust clearance from U.S. and European regulators to form a joint venture with American Airlines on transatlantic routes.
BA has fallen further behind Lufthansa and AirFrance-KLM in recent years as it failed to match their merger activity.
Air France-KLM, a merger of the French and Dutch flag carriers, became top European cargo carrier in January with the takeover of Martinair, a Dutch cargo and charter airline with a sizeable freighter operation.
Lufthansa’s cargo business has grown with the acquisition of Swiss, which also has a significant freight operation, and a 25 percent stake in Jade Cargo International, a Chinese all-cargo carrier. Lufthansa is also a 50:50 partner with Deutsche Post DHL, in AeroLogic, a German cargo airline that began operations in mid-June and plans to buy eight Boeing 777 freighters.
Contact Bruce Barnard at brucebarnard47@hotmail.com.