British Airways and Iberia merger agreed
November 16th, 2009 by elisa

British Airways and Iberia have agreed to merge to create the world’s third largest airline by revenue. The merger is expected to be completed in late 2010 and will have 419 aircraft and fly to 205 destinations.

Virgin Atlantic reacted by warning of a heighted stranglehold of take off and landing slots at Heathrow

“The BA/Iberia merger will increase BA’s dominance at Heathrow with 44% of take-off and landing slots this winter,” the rival said.

“It is impossible for any other airline to replicate their scale. Regulators in Europe and the US need to be alert to BA’s growing dominance through proposals such as its monster monopoly with American Airlines, proposals which will not be in the consumer interest.”

BA chief executive Willie Walsh said: “The merger will create a strong European airline well able to compete in the 21st century. Both airlines will retain their brands and heritage while achieving significant synergies as a combined force.”

The Spanish airline’s chairman and CEO Antonio Vázquez said: “It has been a long process where many people, both at British Airways and Iberia, have worked very hard to reach this agreement. But in the end it was worth it. This agreement is a giant step in the history of both Iberia and British Airways.

The aim of the new group is to combine the two carriers’ leading positions in the UK and Spain and enhance their strong presence in the international long haul markets, while retaining the individual brands and current operations of each airline.

BA passengers will gain access to up to 59 new destinations, of which 13 will be in Latin America, while Iberia’s will gain up to 98 new destinations across the UK airline’s network. According to the merger statement, they will also be offered better frequencies and connections, more competitive prices, access to more VIP lounges and enhanced frequent flyer benefits.

 We hope that the proposed benefits to this merger are true for the long term and not just the short term until a monopoly is established as is prophesized by Virgin Atlantic. I suppose all we can do at the moment is to watch this space…

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