:D:D:D

Great post, thanks. But I highly doubt that IB will be a Star Alliance member in 5 months time. Every other airlines needed a lot longer to do all the necessary IT work, change booking classes etc. This is not a trivial task and they would need to start this process yesterday.

Welcome to the OW forum chumbawumba ^. Did you click on the wrong button or what went wrong? :D

I am not sure why LH would want to invest into IB. Lufthansa just invested into Jet Blue and I don't see the logic behind an investment into IB.

Even after taking the JetBlue stake, LH has significant cash reserves on their hands, plus access to more money if need be.

The reason that they would like to buy Iberia (albeit at a reasonable price, and not at the premium that such an acquisition would currently involve) is, and always has been, the Latin American network. As chumbawumba posted upthread, there are relatively few *A connections from Europe to LatAm:

LH: MEX, CCS, GRU, EZE
LX: GRU, SCL
TP: CCS + 8 airports in Brazil

Iberia also has routes to MEX, CCS, GRU, GIG, SCL and EZE, which would create overlaps. But they also have routes to MVD, LIM, GYE, UIO, BOG, PTY, GUA, SJO, SDQ and HAV, none of which are are currently served non-stop from Europe on *A. It would go a long way towards strengthening *A's currently fairly weak position in LatAm.

With the start of new, tighter US immigration regulations, higher US visa application fees and a general perception that connecting in the US is more trouble than it's worth, these non-stops already command a significant price premium for the simple reason that they bypass the US. I expect this premium to increase in the future.

While BA could also benefit from this development, they seem to see their future in North America (as evidenced by them starting flights from Continental Europe to the US). Besides, BA has three major projects currently underway (consolidation of London operations, including the move to T5 at LHR and a rumoured closing of the LGW base; and the ex-Europe transatlantics; and the planned and partially annouced renewal of their both the shorthaul and longhaul fleet) which will all require a certain amount of capital expenditure (especially the fleet renewal). Taking on a fourth project - an integration of Iberia - may prove too much for BA at this point in time. BA was given every opportunity to buy Iberia - that they have not taken advantage shows that they're not interested in Iberia. At least not at the current asking price.

One other point for LH is that they have extensive fleet commonality with IB's mostly-Airbus fleet, which BA would not. While the short-haul fleet would align to a degree, BA does not have a single Airbus longhaul aircraft, while Iberia does not have a single Boeing longhaul aircraft. There is less synergy to a BA/IB deal than a LH/IB deal.

There are a lot of good reasons why LH should buy Iberia - but at the moment they feel that Iberia is simply over-valued.

I would be very surprised if it could happen that quickly , IIRC when MX left Star they were subject to a 2 year 'standdown' period before they could join another alliance , I would be very surprised if Oneworld did not have a similar clause in their termination conditions ( I accept that CP flights were permitted on Star RTWs during the merger process with AC , but they were never actually a Star member in their own right )

So LAN Chile would be free to compete with Iberia on the Latin America - Europe routes? And where would this leave TAP? Would they be forced to feed the new Iberian hub at MAD? They'd be better off in OW or ST in that case.

I think TAP would continue to do what it does best - serve Brazil, where they have 8 destinations. The only non-Brazilian destination in South America they serve right now is Caracas. TAP would continue to fit into *A even if Iberia were brought in. Spanair would be a real problem, however.

And yes, LAN could (and would have to) compete with IB on LatAm-Europe routes.

Extraordinary Iberia's Board meeting regarding Star Alliance
 

Today an extraordinary Iberia board meeting has decided to maintain Spanair JK on the Star Alliance Alliance , once the adquision of Spanair is finished.

Source: http://www.sepla.es/news/archives/012416.php

Last week IB CEO Conte , on the Oneworld meeting in Los Angeles , sugested that Spanair will be moved to Oneworld once reestructured .

That very same day IB deputy CEO Blesa , and Caja Madrid's CEO , warned British Airways that if the talk between IB-BA didn't ended succesfully before the end of June , Iberia will pick-up the phone to Lufthansa .

Source:

"Caja Madrid espera un acuerdo con British antes de junio o se echará en brazos de Lufthansa"
"Caja Madrid expect an agreement with British Airways before June , or will tie-up with Lufthansa"

http://www.elmundo.es/mundodinero/20...206531289.html


LH CEO responded he was waiting for the call .

The decision of Iberia's board today clarify more the situation .

I expect Iberia to announce it's move to Star Alliance withing weeks .





-------------------------------

Other Iberia news:

2007 Short/Medium haul Departure Punctuality

AF... 81.5
IB... 81.3
KL... 80.5
LH... 80.2
BA... 67.5

Source: Association of European Airlines , Consumer Report 2007
http://files.aea.be/News/PR/Pr08-006.pdf , Page 5

But more importantly is the "FLIGHT REGULARITY" percentage , that's the percentage of scheduled flights that are ACTUALLY operated , and not cancelled for any reason.

Short/Medium Haul FLIGHT REGULARITY in %

LH... 98.9 %
IB... 98.8 %
KL... 98.5 %
AF... 98.1 %
BA... 98.0 %


Long Haul FLIGHT REGULARITY in %

LH...100.0 %
IB... 99.6 %
KL... 99.4%
BA... 99.4 %
AF... 99.2 %


Notice that a very small decimal variation means LOTS of flights cancelled .



Baggages delayed per 1.000 PAX

BA... 26.5
KL... 19.7
AF... 17.6
LH... 15.8
IB... 13.8


Source : http://files.aea.be/News/PR/Pr08-006.pdf Page 4



------------------------


Iberia to raise luggage allowance and cut excess weight charges

From 20 to 23 kg. in Spain and Europe, and to 46 kg. (two pieces of 23 kg. each) in Tourist Class on overseas flights (the Americas, Africa, and the Middle East).

50% average reduction in excess weight charges, and extra 30% discount when paid in advance via www. iberia.com.

http://www.elmundo.es/mundodinero/20...208513775.html
-------------------------

"Iberia could hire 300 pilots as part of new summer deal with Sepla"

"...it could hire up to 300 more pilots to boost growth on its long-haul flights to the Americas ..."

http://www.forbes.com/afxnewslimited...fx4911372.html

http://www.expansion.com/edicion/exp...o/1114051.html

------------------------

Iberia suffer a 24% PAX reduction between Madrid and Barcelan in March due to the new High-Speed train link AVE .

http://www.bolsamania.com/actualidad...rhh3jjvso7vdg5

------------------------

Vueling and Clickair will merger before the summer , according to new Vueling CEO .

Iberia says it will remain the reference shareholder but will not seek the "control" of the new airline .

The resulting airline will be the 4th largest Low-cost airline in Europe.

-------------------------

Iberia has started the construction of a new maintenance facility in Barcelona airport .

Render photos from iberia.com :

http://grupo.iberia.es/content/Grupo...o%20tierra.jpg

Iberia just today has revealed that the new "Director Plan" envision the opening of up to 10 long-haul routes , including codeshares , from BCN in the following 3 years , and for that purpose the new maintenance faciity was crucial .

The new hangar will be equipped to conduct all types of inspections, repairs, and special tasks for the nearly 80 companies using the airport. The hangar is expected to specialise in “C-type” inspections of Airbus A-320s and A-340s


----------------------------

Nice to see our Spanish friend again. Been a while since we last saw you here. ;)

Not long enough.

Jawohl!~ Maybe he can get some work with Fraport?

I'm surprised he is even employed! ;)

But he does describe LHs dream scenario: BA and IB talks fail so LH is in a very confortable position to buy. They are highly interested in IB but not for the current asking price.

It looks like LH is going to have their hands full with raping and pillaging BD, so that may put them off an IB deal for a while.