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Air Europa Plans IPO In 2014  
User currently onlineMarkam From United States of America, joined Jan 2008, 368 posts, RR: 1
Posted (5 months 1 week 6 days 3 hours ago) and read 2078 times:

According to Spanish newspaper El Mundo (see link below), Air Europa is planning a prospective IPO in 2014.

While private companies have some advantages, a publicly held UX may be able to raise funds more effectively in order to support their expansion plans (the article mentions that nine new planes will join the fleet in 2014, and that MIA, SJU and "Russia" are future destinations for 2014). Thoughts?

http://www.elmundo.es/economia/2013/...1/05/5278ea1f0ab74038668b45a6.html (Spanish only)

7 replies: All unread, jump to last
 
User currently offlineAM777LR From Mexico, joined Sep 2013, 206 posts, RR: 0
Reply 1, posted (5 months 1 week 6 days 2 hours ago) and read 1962 times:
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I find SJU interesting. since IB dropped it, I assumed there wasn't a big SJU-MAD market.

User currently offliner2rho From Germany, joined Feb 2007, 2497 posts, RR: 1
Reply 2, posted (5 months 1 week 4 days 4 hours ago) and read 1491 times:

Quoting AM777LR (Reply 1):
I find SJU interesting. since IB dropped it, I assumed there wasn't a big SJU-MAD market.

IB dropped it along with other lower-yielding routes because they couldn't make it work with their high legacy cost base and unsuited aircraft type. But UX has successfully picked up several ex-IB routes over the past year. I think they could make SJU work.

As for MIA, didn't UX try something via TFN in the past, but didn't work out? I guess this would be a nonstop now.

Quoting Markam (Thread starter):
"Russia" are future destinations for 2014

Very good move. IMO this is a market that Spanish carriers have overlooked. Russian tourism is growing strong in Spain, many Russians are buying beach properties, etc. Russia-Spain has large market growth potential and little competition so far.


User currently offlinecybergus From Venezuela, joined Mar 2006, 500 posts, RR: 10
Reply 3, posted (5 months 1 week 4 days 1 hour ago) and read 1390 times:

Quoting r2rho (Reply 2):
As for MIA, didn't UX try something via TFN in the past, but didn't work out? I guess this would be a nonstop now.

They did try TFN first. Then they did MAD. Then they switched to 767. Then they dropped the route and start the codeshare with DL from JFK. I really don't know if this route will work again, I have my doubts. Even that MIA-MAD can be very lucrative we can't forget that is a OW territory with IB and AA on the run with 3 daily flights. Complimenting that we have BCN with AA. They might want to try TFN again twice a week but still don't see it.

Cheers

Tavo



LAN Excellence in Flight
User currently offliner2rho From Germany, joined Feb 2007, 2497 posts, RR: 1
Reply 4, posted (5 months 4 days 5 hours ago) and read 1051 times:

Quoting cybergus (Reply 3):
Even that MIA-MAD can be very lucrative we can't forget that is a OW territory with IB and AA on the run with 3 daily flights.

Agree, trying to squeeze into already well covered MIA-MAD is risky, and even if they achieve it, it would only be via price competition which will drive down yields. IMO there is low hanging fruit in secondary LatAm destinations not served by IB, where they could command higher fares too.


User currently offlineSKY1 From Spain, joined Apr 2006, 879 posts, RR: 4
Reply 5, posted (5 months 4 days 2 hours ago) and read 935 times:

Quoting cybergus (Reply 3):
I really don't know if this route will work again, I have my doubts.

I do also.

While UX has been able to establish itself as the Spain's second network carrier and growing slowly but surely I find a mistake insist again on MIA as that route has show there is not room for 3 players. Not at all! If my memory serves me well, I recall UX having 3 unsuccessful attempt to have profit with the MIA routes



Time flies! Enjoy life!
User currently offlinecybergus From Venezuela, joined Mar 2006, 500 posts, RR: 10
Reply 6, posted (5 months 4 days 1 hour ago) and read 876 times:

Quoting r2rho (Reply 4):
Agree, trying to squeeze into already well covered MIA-MAD is risky, and even if they achieve it, it would only be via price competition which will drive down yields. IMO there is low hanging fruit in secondary LatAm destinations not served by IB, where they could command higher fares too.

Well...seems the route is ready to be launched. Looking at it I have higher doubts it will work. The schedule is just horrible and the layover here in MIA will cost a lot of money to UX.

The secondary market can work in LatAm destinations as people really look always for the best bargain and nevertheless coach product in UX A332 is slightly better than IB A343/A346. Now looking at MIA-MAD there is a lot of business travelers that will not use UX J product as AA/IB offers a better one in the MIA-MAD (Tons of connections, better schedules, multiple flights, best J service, etc). Also consider that IB is sending their new product and the A333 to this route, which makes it more competitive.

Quoting SKY1 (Reply 5):
I do also.

While UX has been able to establish itself as the Spain's second network carrier and growing slowly but surely I find a mistake insist again on MIA as that route has show there is not room for 3 players. Not at all! If my memory serves me well, I recall UX having 3 unsuccessful attempt to have profit with the MIA routes

True. I don't think that the "3rd is the one" will apply in this case. They tried so hard in the past to make it work, first TFN then MAD then code sharing with DL...and still nothing. Is not that I don't wish them the best of success here in MIA, is just that I think there are other options that could fit better. Maybe they should take advantage of LatAm markets where IB has a monopoly.

Cheers



LAN Excellence in Flight
User currently offlinePDPsol From United States of America, joined Feb 2004, 1088 posts, RR: 6
Reply 7, posted (5 months 4 days ago) and read 841 times:

Quoting r2rho (Reply 2):
But UX has successfully picked up several ex-IB routes over the past year. I think they could make SJU work.
Quoting SKY1 (Reply 5):
While UX has been able to establish itself as the Spain's second network carrier and growing slowly but surely I find a mistake insist again on MIA as that route has show there is not room for 3 players. Not at all! If my memory serves me well, I recall UX having 3 unsuccessful attempt to have profit with the MIA routes

This discussion topic is very interesting. UX has been developing its route network to the Americas [North and South] for years. They now find themselves in a truly unique position as Spain's second-largest carrier, with the opportunity to offer IB/AA/LA/JJ real competition on TATL routes to key markets from MAD, including EZE, GRU, MEX, JFK and MIA. These five markets are the most important to IB and will only see greater service improvements as competition heats up, thanks to UX. One cannot exclude the impact of AV either, or even efforts by LH/LX and AF/KL to develop the Europe-S. America market, but we'll leave that for another thread.

UX had always played its 'secondary market' strategy well, with the leisure/friends-and-family market to Latin America, the US and the Caribbean. The real story today, however, is UX entering massive 'bread-and-butter' markets, with high-margin business customers as well as wealthier travelers.

An IPO is the right decision for UX, as a public listing will facilitate access to capital and provide resources to fund expansion [aircraft/facilities/routes/working capital growth] and enhance its transition from a 'captive carrier' serving an affiliated tour group business to a truly viable stand-alone network from Spain to the Americas, and Europe.

UX finally has friends in the region, with an interest in developing the carrier. Sky Team members, AF/KL/AZ all work closely with UX, as does DL/AM and G3.


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