Wednesday, January 30, 2013

►► SPAIN: Iberia to drop Cairo; to boost capacity to Casablanca, Algiers, Dakar, Nouakchott, and Malabo.

[UPDATE 30 JANUARY] Spanish carrier, Iberia (IB), has announced details of its new commercial and routes policies under the Transformation Plan it announced recently with various routes in Africa to be affected, for better and for worse.

Iberia new livery? (Skyliner)
The plan calls for the optimization of the Spanish airline’s route network in 2013, strengthening its most strategic and profitable routes, and dropping loss makers. Subsequently, it expects to resume growth if economic and market conditions allow, increasing revenues while cutting sales costs, to build a solid platform for future growth.

Within the Transformation Plan, there will be an increase in capacity to:
  • Casablanca (Morocco)
  • Algiers (Algeria)
  • Dakar (Senegal)
  • Nouakchott (Mauritania)
  • Malabo (Equatorial Guinea) (See this post)

Iberia has also announced Luanda, Angola as one of its future A330-300 destinations from February 2013 having previously announced A330-300 flights to Dakar when the first of eight A330-300s arrive from mid-January onwards.

Iberia’s CEO Rafael Sánchez-Lozano said:
Iberia is obliged to transform its commercial model, and this means focusing on routes that can help turn the company around – the profitable ones that still have some margin for future growth –, and these are our most strategic long-haul routes. The ones we are dropping are the biggest loss makers, where we have no chance of turning a profit under current conditions. Once we are able to restore competitiveness to the airline, we will carefully look at these routes to see if we can pick them up again.

In brief, Iberia's Transformation Plan aims to:
  • Stem Iberia's cash losses by mid-2013;
  • Turnaround in profitability of at least €600 million from 2012 levels to align Iberia with IAG's target return on capital of 12 per cent by 2015;
  • Network capacity cut by 15 per cent in 2013 to focus on profitable routes
  • Downsizing its fleet by 25 aircraft - five long haul and 20 short haul.
  • Reduction of 4,500 jobs to safeguard around 15,500 posts across the airline. This is in line with capacity cuts and improved productivity across the airline.
  • New commercial initiatives to boost unit revenues including increased ancillary sales and website redesign.
  • Discontinue non-profitable third party maintenance and retain profitable ground handling services outside Madrid.
The transformation will be funded from Iberia's internal resources.

[UPDATE 30 JANUARY] According to AirlineRoute, Iberia has postponed its planned Airbus A330-300 inaugural service by 20 days.
  • Madrid – Dakar IB3328/3329 09MAR13 – 16MAR13 Day 6 (Previously planned to operate in Feb 2013) 
  • Madrid – Luanda eff 08MAR13 2 weekly flights (Previously planned from 01FEB13)
Source [AirlineRoute]