IAG CEO Sees Growth Opportunities in Demise of European Airlines
October 13 2017 - 6:38AM
Dow Jones News
By Robert Wall
LONDON--IAG SA (IAG.LN) is eyeing some of Monarch Airlines'
(MA.YY) slots at London's Gatwick Airport and may order more Airbus
SE (AIR.FR) planes for its units, said chief executive Willie Walsh
on Friday, adding that the bankruptcies of Monarch and Air Berlin
(AB1.XE) could provide growth opportunities for European
carriers.
The demise of European airlines is reducing the number of seats
for sale in the short term and could change the competitive
landscape in parts of Europe in the longer term, Mr. Walsh told
reporters. It could also help airlines wield greater control over
ticket pricing, he added.
Monarch ceased flying last week after running out of money,
while Air Berlin on Thursday sold the bulk of its business to
Deutsche Lufthansa AG (LHA.XE) after declaring bankruptcy in
August. Bids are due next week for Alitalia (ALITALIA.YY), which
went bust in May.
Mr. Walsh, whose company bid for parts of Air Berlin, also said
that the effective takeover of Germany's second-largest carrier by
its No. 1 airline raised "significant competition issues."
International Consolidated Airlines Group--as IAG is formally
known--would be positive in the July-to-December period; that
outlook hasn't changed, he said.
IAG also sees growth opportunity elsewhere.
Aer Lingus is looking to add more Airbus A321LR narrowbodies
that can be used on trans-Atlantic hops and may have scope to add
more Airbus A330 long-haul planes, Mr. Walsh said.
Aer Lingus "could expand faster than their current plan," said
Mr. Walsh, who once ran the Irish airline.
Mr. Walsh said IAG is also looking to expand budget long-haul
unit Level from its current two-plane capacity to up to 30 by
2022.
Level, which began flying this year, will also set up operations
beyond its Barcelona base, though the location hasn't been set
yet.
Mr. Walsh said Level could provide IAG with a gateway to
price-sensitive secondary cities in China, where a lack of demand
for business-class seats has made it more difficult for British
Airways to make money.
Mr. Walsh said that in addition to the Airbus A330s flown by
Level, the carrier also could add the A321LR planes that Aer Lingus
flies.
Those A321LR planes--single-aisle aircraft configured for longer
ranges--could also be operated by British Airways and Spanish unit
Iberia, he said.
Write to Robert Wall at robert.wall@wsj.com
(END) Dow Jones Newswires
October 13, 2017 07:23 ET (11:23 GMT)
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