Business World

Saturday 21 October 2017

BA 'happy' with traffic on London/Dublin

IAG board agrees to compromise deal with Iberian unions in cutting costs and stemming losses

John Mulligan

John Mulligan

British Airways is "very happy" with the performance of its services to Dublin after the brand made a reappearance at Dublin following a near 25-year hiatus, according to its Ireland country manager, Simon Daly.

BA began operating a Heathrow-Dublin service again last year after the group, part of IAG, acquired British Midland. The airline is increasing the number of flights on the service to eight a day for the summer.

Mr Daly declined to say what type of yields or load factors the route has been generating for BA, but he said that it has been a "very big success" for the airline. The Dublin-Heathrow route is one of the busiest air corridors in Europe.

Mr Daly declined to comment on the rejection by the European Commission two weeks ago of Ryanair's latest takeover attempt of Aer Lingus. As part of a sweeping remedy package presented to mandarins in Brussels, Ryanair had offered to transfer Aer Lingus slots at Heathrow and Gatwick to British Airways so it could serve Cork and Shannon as well as Dublin.

Mr Daly insisted that there was ample competition on the market, particularly between Dublin and London.

Four operators – Aer Lingus, Ryanair, BA and Cityjet – have services between the two capitals.

Meanwhile, IAG, the owner of British Airways, has backed a compromise deal that will limit the number of job cuts at Spain's ailing carrier Iberia to just over 3,000.

International Airlines Group, which was created from the merger of the two airlines in 2011, originally proposed 3,800 redundancies but has accepted a government-appointed mediator's recommendation that 3,141 workers should go.

The response of Iberia's unions to the revised proposals, which include severance pay of 35 days a year rather than 20, is still not known.

IAG chief executive Willie Walsh said recently that Iberia "must adapt to survive", having made a loss of €351m last year.

But despite three months of negotiations, no agreement on a way forward has been reached between the airline and its unions. Iberia workers have already held two strikes and are planning further industrial action this month.

The plan proposed by Spanish mediator Gregorio Tudela would cut pay as much as 14pc, with no raise before 2016.

"If accepted by the unions, this would see an end to strikes at Iberia and lead to a smoother turnaround," said James Hollins, a London-based analyst at Investec with a 'buy' rating on IAG stock. Unions still have to submit the proposal to members for ratification.

Irish Independent

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