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British Airways/IAG Loss Iberia Job Cuts To Come  
User currently offlineOA260 From Ireland, joined Nov 2006, 27112 posts, RR: 60
Posted (2 years 2 months 2 weeks 6 days 2 hours ago) and read 8689 times:

IAG announced today that jobs will be cut at Iberia due to losses.

Article here :

British Airways Owner IAG Plans Iberia Job Cuts After Loss

British Airways parent International Consolidated Airlines Group SA (IAG) plans to cut jobs at Spanish arm Iberia as part of a revamp to be unveiled next month after the Madrid-based unit pushed the company to a second-quarter loss.
IAG will reduce the workforce as it shrinks Iberia’s business and reshapes the network in the near term in order to boost unit revenue while seeking cost cuts in all areas, Chief Executive Officer Willie Walsh said today in a statement.
Shortfalls at Iberia mean London-based IAG will probably record a “small operating loss” for the full year, the company said, after earlier forecasting it would break even. The second- quarter operating loss was 42 million euros ($51 million), including costs from BMI, acquired in April from Deutsche Lufthansa AG (LHA), versus a year-earlier profit of 134 million euros.

http://www.bloomberg.com/news/2012-0...beria-job-cuts-following-loss.html

Another article here also :

Loss for BA owner

British Airways parent company International Airlines Group (IAG) has announced losses of around £200 million.

Passengers numbers are up around five per cent in the last month but the losses are put down to a big rise in the cost of fuel and losses associated with the perchase of British Midland. IAG owns BA at Gatwick and Heathrow, British Midland and Iberia. Chief Executive Willie Walsh said: “We made an operating loss of €4 million in the quarter, including €50 million of bmi losses, before exceptional items. While our revenue performance was good, up 11.5 per cent, this was countered by an increased fuel bill of €314 million, a rise of 25.1 per cent.

http://www.itv.com/news/meridian/2012-08-03/ba-owner-announces-losses/

[Edited 2012-08-03 04:03:33]

25 replies: All unread, showing first 25:
 
User currently offlineFCAFLYBOY From United Kingdom, joined Nov 2006, 601 posts, RR: 0
Reply 1, posted (2 years 2 months 2 weeks 6 days ago) and read 8462 times:

Still not bad given all the many changes, and excellent versus the huge losses AF/KL are racking up.

User currently offlineslinky09 From United Kingdom, joined Jun 2009, 843 posts, RR: 0
Reply 2, posted (2 years 2 months 2 weeks 6 days ago) and read 8317 times:

With jet fuel prices currently around 7% lower than a year ago and IAG's fuel bill 25% higher, I wonder if someone hedged very badly?

User currently offlineOA260 From Ireland, joined Nov 2006, 27112 posts, RR: 60
Reply 3, posted (2 years 2 months 2 weeks 5 days 21 hours ago) and read 7959 times:

Quoting FCAFLYBOY (Reply 1):
Still not bad given all the many changes, and excellent versus the huge losses AF/KL are racking up.

True there have certainly been alot of influences at IAG the past number of months.


User currently offlineLAXintl From United States of America, joined May 2000, 25741 posts, RR: 50
Reply 4, posted (2 years 2 months 2 weeks 5 days 20 hours ago) and read 7838 times:

A couple points - the weakness of the Euro is hurting airlines as they have large dollar, yen and other currency expenses.

Also speaking about the Euro, news on the radio even here in the US was that IAG today announced it was commencing contingency planning for Spain to exit the Euro!


IAG plans for Spain euro exit, Iberia overhaul
http://www.reuters.com/article/2012/08/03/us-iag-idUSBRE8720BH20120803

=



From the desert to the sea, to all of Southern California
User currently offlinePezySPU From Croatia, joined Dec 2011, 283 posts, RR: 0
Reply 5, posted (2 years 2 months 2 weeks 5 days 17 hours ago) and read 7576 times:

Quoting OA260 (Thread starter):
Shortfalls at Iberia mean London-based IAG will probably record a “small operating loss” for the full year

That's a bit disappointing considering that they had a very nice profit last year even with IB's losses. And frankly, I don't see much action at IB with restructuring. Heck, AF announces new cost-cutting ideas constantly, they will probably do something about their losses. But IB seems rather laid back.

I can't wait to see what they'll come up with in September (from link above).


User currently offlineeljonno From Australia, joined Sep 2008, 172 posts, RR: 0
Reply 6, posted (2 years 2 months 2 weeks 5 days 17 hours ago) and read 7475 times:

Quoting LAXintl (Reply 4):
Also speaking about the Euro, news on the radio even here in the US was that IAG today announced it was commencing contingency planning for Spain to exit the Euro!

Does this mean they would trade in Sterling then potentially? That would be an interesting development.


User currently offlineLJ From Netherlands, joined Nov 1999, 4461 posts, RR: 0
Reply 7, posted (2 years 2 months 2 weeks 5 days 16 hours ago) and read 7437 times:

Will be interesting to learn how the IB unions will react to this announcement.

User currently offlineSQ773 From Spain, joined Apr 2005, 200 posts, RR: 0
Reply 8, posted (2 years 2 months 2 weeks 5 days 5 hours ago) and read 5885 times:

Quoting LJ (Reply 7):
Will be interesting to learn how the IB unions will react to this announcement.

Now lets see how the customer reacts, because after reading this news many people will advoid buying IB tickets from september-october onwards ( or worst, by Christmas time ) for fear of future strikes, that will come yes or yes now


User currently offlinejumpjets From United Kingdom, joined Apr 2012, 846 posts, RR: 0
Reply 9, posted (2 years 2 months 2 weeks 5 days 4 hours ago) and read 5701 times:

Quoting PezySPU (Reply 5):
And frankly, I don't see much action at IB with restructuring. Heck, AF announces new cost-cutting ideas constantly, they will probably do something about their losses. But IB seems rather laid back.

Do you not consider the introduction of Iberia express and the ordering of new more efficient A330s as important stages in Iberia's restructuring - it will take some years to work it through but you have to start somewhere.


User currently offlineLHRFlyer From United Kingdom, joined Apr 2010, 817 posts, RR: 1
Reply 10, posted (2 years 2 months 2 weeks 5 days 1 hour ago) and read 5301 times:

Quoting PezySPU (Reply 5):
But IB seems rather laid back.

A full restructuring plan will be published in September. I think we can say with confidence that with IAG and Willie Walsh overseeing it, the restructuring will be pursued with some vigour!


User currently offlinePezySPU From Croatia, joined Dec 2011, 283 posts, RR: 0
Reply 11, posted (2 years 2 months 2 weeks 4 days 23 hours ago) and read 5173 times:

Quoting jumpjets (Reply 9):

Honestly, I had Iberia Express in mind but forgot to mention it in the post.   

Quoting LHRFlyer (Reply 10):
I think we can say with confidence that with IAG and Willie Walsh overseeing it, the restructuring will be pursued with some vigour!

  


User currently offlinetonystan From Ireland, joined Jan 2006, 1443 posts, RR: 2
Reply 12, posted (2 years 2 months 2 weeks 4 days 23 hours ago) and read 5108 times:

Quoting LHRFlyer (Reply 10):

A full restructuring plan will be published in September. I think we can say with confidence that with IAG and Willie Walsh overseeing it, the restructuring will be pursued with some vigour!

God help them is all I can say!



My views are my own and do not reflect any other person or organisation.
User currently offlinejumpjets From United Kingdom, joined Apr 2012, 846 posts, RR: 0
Reply 13, posted (2 years 2 months 2 weeks 4 days 22 hours ago) and read 5046 times:

Quoting LHRFlyer (Reply 10):
I think we can say with confidence that with IAG and Willie Walsh overseeing it, the restructuring will be pursued with some vigour!

lets hope his people skills have improved a bit since the long running BA dispute which he oversaw!

However I have made a couple of long haul flights with IB in recent times and honestly their service and the staff attitude has been pretty rock bottom [as opposed to short haul staff who seem unrelentingly cheerful] - so I hope this restructuring will lead to major gains in this area as well as the cost savings, efficiency gains and route reviews which will inevitably be a focus for Willie.


User currently offlineLHRFlyer From United Kingdom, joined Apr 2010, 817 posts, RR: 1
Reply 14, posted (2 years 2 months 2 weeks 4 days 22 hours ago) and read 4978 times:

Quoting jumpjets (Reply 13):
lets hope his people skills have improved a bit since the long running BA dispute which he oversaw!
Quoting tonystan (Reply 12):
God help them is all I can say!

If you actually look at the facts during the whole of his tenure a huge amount of significant change was achieved at BA and a lot of it achieved without confrontation.

Many observers thought that BA renegiating the terms of its pension scheme and changing ground staff working practices before the move to Terminal 5 would be impossible without bitter confrontation with the unions. But that didn't happen.

The big exception was of course the cabin crew union. However, all the facts in the court cases point to failings on the part of BASSA rather than BA management.

Things will no doubt be different at Iberia in Spain, but Willie Walsh and IAG will see it through and it will be better for it. It's been a long time since BA has been growing passenger numbers, investing in its product and expanding its network in the way it is now and that's because its restructured itself to compete. A few years ago it was dubbed a pension fund with wings that was doomed to decline into irrelevance.


User currently offlineTalaier From Spain, joined May 2008, 490 posts, RR: 0
Reply 15, posted (2 years 2 months 2 weeks 4 days 20 hours ago) and read 4861 times:

The restructuring plan basically will lay off most if not all of IBs senior staff (who fly long haul and worked back when IB was a public company and consistently bring up customer satisfaction issues) , and presumably move those flying short haul into long haul with lower salaries. Most if not all national flights (except BCN) will be moved to IB express along with a big chunk of European operations. Strikes will not be an issue because effectively most of the union members will be kicked out in the process, plus Spanish labour law gives companies incurring loses huge power to reorganise themselves internally as they wish. This plan has been on the table for months now and pretty much everyone in IB knew about it and saw it coming. For most of the long haul staff (some of which I know personally) this summer will be their last one in the company.

User currently offlinemikey72 From United Kingdom, joined Oct 2009, 1780 posts, RR: 2
Reply 16, posted (2 years 2 months 2 weeks 4 days 19 hours ago) and read 4787 times:

Quoting LHRFlyer (Reply 14):
A few years ago it was dubbed a pension fund with wings that was doomed to decline into irrelevance.

British Airways was never going to decline into irrelevance they just have too much going for them.

Due to that as much as I love the airline I don't mind admitting that probably no other airline on the planet could have survived the catalogue of errors they made in short succession combined with gulf wars, economic crisis and 9/11.

Quoting LHRFlyer (Reply 14):
If you actually look at the facts during the whole of his tenure a huge amount of significant change was achieved at BA and a lot of it achieved without confrontation.

Rod Eddington and Willie Walsh did a great job.

Quoting LHRFlyer (Reply 14):
Things will no doubt be different at Iberia in Spain, but Willie Walsh and IAG will see it through and it will be better for it.

I hope so but outside it is true there are disturbing currents to battle through. None of which Willie Walsh can do much about.



Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
User currently offlineFI642 From Monaco, joined Mar 2005, 1079 posts, RR: 2
Reply 17, posted (2 years 2 months 2 weeks 4 days 19 hours ago) and read 4727 times:

I understand BA will be outsourcing some US stations soon too.


737MAX, Cool Planes for the Worlds Coolest Airline.
User currently offlinerichardw From United Kingdom, joined May 2001, 3755 posts, RR: 0
Reply 18, posted (2 years 2 months 2 weeks 4 days 17 hours ago) and read 4603 times:

Will getting a controlling interest in VLG be part of the plan?

User currently offlinetonystan From Ireland, joined Jan 2006, 1443 posts, RR: 2
Reply 19, posted (2 years 2 months 2 weeks 4 days 15 hours ago) and read 4473 times:

Quoting LHRFlyer (Reply 14):
However, all the facts in the court cases point to failings on the part of BASSA rather than BA management.

Couldnt be further from the truth!



My views are my own and do not reflect any other person or organisation.
User currently offlineLHRFlyer From United Kingdom, joined Apr 2010, 817 posts, RR: 1
Reply 20, posted (2 years 2 months 2 weeks 4 days 14 hours ago) and read 4436 times:

Quoting tonystan (Reply 19):
Couldnt be further from the truth!

Absolutely wrong. The court judgments in the cases on changes to crewing levels made it clear that the two cabin crew unions did not negotiate in good faith with BA. The two cabin crew branches were frequently arguing between themselves and refused to sit in the same room as each other. They were also invited to produce their own cost savings proposals, which when independently audited by a major international accountancy firm were found to be worth only one third of what they claimed to be worth and the unions then refused to negotiate any further.

The unions had months to negotiate with BA and they failed their membership catastropically.


User currently offlineSQ773 From Spain, joined Apr 2005, 200 posts, RR: 0
Reply 21, posted (2 years 2 months 2 weeks 4 days 2 hours ago) and read 4138 times:

Quoting Talaier (Reply 15):
Strikes will not be an issue because effectively most of the union members will be kicked out in the process, plus Spanish labour law gives companies incurring loses huge power to reorganise themselves internally as they wish.

Hey, where do you live ? And that´s it ? Strikes will not be an issue because the union members will be kicked out ? Come on !!

Wow, had we known it was sooooo easy to advoid an strike, we would have sacked all the unions members months ago just in case.

No, things do not work like that. The Unions have to be there and everywhere as long as they are realistic and do not represent a danger for any company because of unrealistic premises. Things are changing, so they must change too. But the solution to any problem ( call it strike or whatever ) should not be to kick them out.


User currently offlinemikey72 From United Kingdom, joined Oct 2009, 1780 posts, RR: 2
Reply 22, posted (2 years 2 months 2 weeks 4 days 1 hour ago) and read 4095 times:

Nobody ever wants to take a pay cut especially when their life has been for a long time built around earning a certain amount of money.

Trouble is if you are unfortunately working for an industry that has changed as much and become as competitive as this one (especially for the legacies) it's just a case of bad luck.

The management of these airlines know these days they can get kids full of wanderlust with itchy feet to work hard and do a good job for peanuts.



Flying is like sex - I've never had all I wanted but occasionally I've had all I can stand.
User currently offlinejumpjets From United Kingdom, joined Apr 2012, 846 posts, RR: 0
Reply 23, posted (2 years 2 months 2 weeks 4 days 1 hour ago) and read 4075 times:

Quoting SQ773 (Reply 21):
The Unions have to be there and everywhere as long as they are realistic and do not represent a danger for any company because of unrealistic premises

I agree - in the 1980s the unions took a trouncing here in the UK and many of the union excesses we saw here were curtailed - but they are still have rights and 'power' as demonstrated by their pre-Olympic threats to get their members bonuses for turning up and doing their jobs during the Olympics. If the IAG management think they can steam roller Spanish unions on the back of a weak Spanish economy then I suspect they will be very disappointed.


User currently offlineTalaier From Spain, joined May 2008, 490 posts, RR: 0
Reply 24, posted (2 years 2 months 2 weeks 3 days 21 hours ago) and read 3814 times:

Quoting SQ773 (Reply 21):

Hey, where do you live ? And that´s it ? Strikes will not be an issue because the union members will be kicked out ? Come on !!

Wow, had we known it was sooooo easy to advoid an strike, we would have sacked all the unions members months ago just in case.

No, things do not work like that. The Unions have to be there and everywhere as long as they are realistic and do not represent a danger for any company because of unrealistic premises. Things are changing, so they must change too. But the solution to any problem ( call it strike or whatever ) should not be to kick them out.

AFAIK, there will be a brief negotiation with the unions that will give few or no concessions. Given IB has incurred losses it can walk out with a severance pay of only 20 days per year worked (as opposed to the 45 days that most employees have on their contracts) which will reduce the costs of laying off staff significantly - including those that are current union members. IB has already been through a very tough period of strikes which I very much doubt will occur again. The redundancies could very well see most (if not all) of IB's long haul employees kicked out.


User currently offlineLAXintl From United States of America, joined May 2000, 25741 posts, RR: 50
Reply 25, posted (2 years 2 months 2 weeks 3 days 17 hours ago) and read 3619 times:

Quoting FI642 (Reply 17):
I understand BA will be outsourcing some US stations soon too.

If true, its long overdue.

BA has been one of the last hold outs to maintain inhouse staffing at many stations. In the US, much of this staff is quite senior, plus they are unionized.

I recall almost 10-years ago when BA wanted to do the same, but for whatever reason the concept fizzled.



From the desert to the sea, to all of Southern California
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