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FCAFLYBOY
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Sun Feb 03, 2013 6:23 pm

Quoting toobz (Reply 49):

Oh I don't know, AF is not exactly 'hot stuff' at the moment either, not sure I would want to see them snapping up any airlines too soon!

Does anyone know what sort of back-up plan IB has for these proposed strikes? Could we see BA being called in to help operate flights on behalf of IB?
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Sun Feb 03, 2013 9:02 pm

Quoting FCAFLYBOY (Reply 50):
Does anyone know what sort of back-up plan IB has for these proposed strikes? Could we see BA being called in to help operate flights on behalf of IB?

Iberia is required by law to operate a specified minimum service to certain destinations.

BA operating Iberia flights is probably an absolute no-no. There might be pressure from IAG for BA to at least cover some of the Iberia operated Madrid-Heathrow rotations but I expect BA staff would rather not get involved.
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Sun Feb 03, 2013 11:23 pm

Quoting LHRFlyer (Reply 51):

really? I never knew such laws existed that's rely interesting.
Why is that, political? Going off topic but I suppose that must include some service to the Canaries/Balearics.


Are there many carriers in Spain to offer spare capacity?
 
Tupolev160
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Sun Feb 03, 2013 11:25 pm

Quoting AR385 (Reply 2):

What a strikingly accurate description...
"In a time of universal deceit, telling the truth becomes a revolutionary act."
 
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lightsaber
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 04, 2013 4:08 am

I'm sad for IB, but they must restructure> I understand the employees frustration, but this is a self inflicted wound.

But how much does BA really have at stake?

Also:
But it is struggling to respond to rivals such as Latam Airline Group, formed this year through a merger of Brazilian and Chilean airlines.

http://www.ft.com/intl/cms/s/0/97b37...ce-00144feabdc0.html#axzz2JtpB6E5y

No amount of striking will make LAN/TAM less competitive. IB was given a breather by the 788 grounding, but that won't last forever. It isn't a question of if IB must cut, but how effective. One big cut is far better than cut followed by cut...

IMHO, BA made a mistake buying IB. Now they must do the best with the hand they have been dealt. Like it or not, IAG must cut job at IB.

Quoting seahawk (Reply 25):
Such a strike is just going to enforce people´s opinion that Iberia is one of the European carriers that is not a good idea to book, just like Alitalia.

That is the crux. I set of disruptive strikes is just an advertisement for the competition.

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AR385
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 04, 2013 9:00 am

According to this, the involved unions will be deciding the logistics of their strike:

http://economia.elpais.com/economia/.../actualidad/1359925100_664231.html

But:

The strike dates will be defined on Monday (today for me) and will be five CONSECUTIVE days.

Which essentially means an all out war has broken out. I wonder why SEPLA is not joining though. Hard to see how IB is going to survive this.

[Edited 2013-02-04 01:10:36]

[Edited 2013-02-04 01:11:50]
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 04, 2013 11:03 am

Quoting lightsaber (Reply 54):
disruptive strikes is just an advertisement for the competition

IMO, is not "just an advertisement for the competition".... is THE BEST advertisement ( the most effective ), and it's free of charge for the competitors... definitely the worst thing you can do if you're struggling with low demand.

Quoting AR385 (Reply 55):
I wonder why SEPLA is not joining though.

I wouldn't be surprised if SEPLA joins the party in the last minute, that will allow them to say "we do our best to avoid this" in the future.

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 04, 2013 8:46 pm

Quoting LHRFlyer (Reply 51):
Iberia is required by law to operate a specified minimum service to certain destinations

AFAIK this normally concerns island destinations. Though it is true that in the case of transportation companies (airlines, trains, busses) Spanish law can require a minimum service to be provided. Not sure what the minimum would be in this case.

Quoting FCAFLYBOY (Reply 50):
Could we see BA being called in to help operate flights on behalf of IB?

Technically yes, but if they do that it would be an all-out war. If IAG really wants to play down the rumors that "BA is killing off IB", that's the last thing they want to do.

Quoting lightsaber (Reply 54):
No amount of striking will make LAN/TAM less competitive. IB was given a breather by the 788 grounding, but that won't last forever.

Indeed LAN-TAM is the number one threat to IB's former LatAm stronghold. However, they will need more than a handful of A333's to counter them... a good stopgap but I hope IAG has a better IB fleet plan than that for the future.

Quoting lightsaber (Reply 54):
BA made a mistake buying IB.

I think it can still work out in the long term, particularly throwing AA into the mix. But they really need to get their act together and sort this out ASAP.

Quoting AR385 (Reply 55):
I wonder why SEPLA is not joining though.

Surprising, given that they have historically been the most active strikers, even against the interests of other employees.
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 04, 2013 9:07 pm

I find it a bit disturbing that certain posters here can show such largesse with the careers and lives of other people. I wonder what would they do faced with the prospect of joining the breadlines in Spain - awfully long as they are these days, vis-a-vis the dire straits that Spain is facing today.

And the folks that will most likely be let go are the most "expensive" ones, i.e. the most senior, the least likely to be hired ever again by any airline. They are simply too old for this new economic order. Ahh... progress.

And if one has been to Spain over the past 6-8 months, understands Spanish and personally knows folks in the thick of it, one has to realize that the perception in Spain is that BA is calling the shots here, picking the cherries and so forth. Phrases like having given Iberia to the pirates are not unheard of. While I do not subscribe to that point of view, fact is, a good deal of people in Spain at large and in Iberia particularly feel that way. And perception, sooner or later, becomes reality if it is not stopped at its tracks.

Therefore the management at C/Velazquez 130 needs to prove that it is calling the shots here, not BA. So far, that has not been the case and time is running out before we may have to regret things.

[Edited 2013-02-04 13:09:38]
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 3:22 am

Quoting r2rho (Reply 57):
I think it can still work out in the long term, particularly throwing AA into the mix. But they really need to get their act together and sort this out ASAP.
Quoting dcajet (Reply 58):

I find it a bit disturbing that certain posters here can show such largesse with the careers and lives of other people.

I don't take their trials for granted. I just jumped ship with a demotion and pay cut to preserve my carrier. Sometimes it is just seeing the writing on the walls.

IB is hurting at LAN/TAM are far more effective competitors today for the South American competition. Do I need to mention what FR and U2 has done to IB on short haul? There is no pretending this is the same economy that allowed the prior work conditions.

Quoting dcajet (Reply 58):
And the folks that will most likely be let go are the most "expensive" ones,

Why I took a pay cut. However, I held my ground as they wanted a far larger pay cut and I made my new employer compensate with vacation days.    This is why one moves when one can. I do not like the seniority system as it means no mobility. One must develop skills and there is an option with airline employees (e.g., management).

If I come across as harsh, I simply do not want IB employees to be in the same shape many of my friends are in. I jumped ship a mere 3 months ago. However, that is far better than what is happening now. The US economy shrank in the 4th quarter due to 'defense cuts' and I came out of that world. For those of us in it, the 'contraction' wasn't a surprise and its going to get worse. So I feel for the IB employees. But there must be money to pay them.

Quoting dcajet (Reply 58):
Therefore the management at C/Velazquez 130 needs to prove that it is calling the shots here, not BA. So far, that has not been the case and time is running out before we may have to regret things.

That has nothing to do with the economic reality. I know worker are frustrated, but scaring off customers is not going to preserve jobs. IB must:
1. Rationalize their fleet. BA will help here tremendously.
2. Reduce costs (the whole point of this thread).
3. Find ways to increase RASM. (e.g., better partnering to the East of Spain as IB's eastward routemap is too sparse).
4. Improve the customer experience (AA did it, so it is possible)

MAD has potential as a hub. But costs must be first brought in line. And quickly. For once the 788 grounding is lifted, IB will be facing a world of LAN 788 lovin' that will be tough. And FR will have a fun with a strike too...

Quoting EK413 (Reply 26):
Honestly, I understand unions fight for better conditions but in this case the airline has no chance of surviving if a 5 day strike goes ahead...

IB isn't that dire... I waited to rebut, but that is the truth. The issue is how much business it will cost them and thus jobs.


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dcajet
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 4:40 am

Quoting lightsaber (Reply 59):
Why I took a pay cut. However, I held my ground as they wanted a far larger pay cut and I made my new employer compensate with vacation days.    This is why one moves when one can. I do not like the seniority system as it means no mobility. One must develop skills and there is an option with airline employees (e.g., management).

Two things come to mind:

1. The job mobility that we enjoy here in the US, is something very unique to our way of life and economic system. In most other countries it is not that easy to jump from job to job. Or cut deals for more vacation days - those are perks reserved for those in management. Which is hardly the case here - these jobs are all unionized and those deals you refer to are not possible. The fact you even bring it up as an example leads me to think you don't even get the predicament these people find themselves in.

2. You do understand that Spain is looking at 27% unemployment, don't you? So you hold on to what you have with tooth and nail.

Care to explain to me what TAM/Lan have to do with all this? Iberia's woes have little to do with Lan or Tam. You do realize that Iberia is much more than flying to Lim/Gye/Scl and Gru/Gig. I fail to see that point. There is a clear difference between Spain and its economic situation, its location in the context of the EU and Lan Chile and Tam Brazil - both Latin carriers with a whole different cost structure; and in the big picture of Iberia's woes they are not that fundamentally relevant. I agree though that Ryanair is a problem. And not just for Iberia. But for BA to LH to AF et al too.

[Edited 2013-02-04 21:35:17]

[Edited 2013-02-04 21:38:01]
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 6:06 am

Quoting lightsaber (Reply 59):
IB must:
1. Rationalize their fleet. BA will help here tremendously.
2. Reduce costs (the whole point of this thread).
3. Find ways to increase RASM. (e.g., better partnering to the East of Spain as IB's eastward routemap is too sparse).
4. Improve the customer experience (AA did it, so it is possible)


1. Iberia only has the 320 family and 330/340 in house. What exactly do you mean by rationalize? Unless rationalizing for you means stuff made in Seattle....

2. I think Iberia is trying to do that...

3. East of Spain - do you mean Italy, the Levant, Greece, China? Turkey? Russia?

4. AA improved its customer experience? Sorry but I need to laugh here, no offense. So can you explain why AA continues to have the worse indicators of ALL US airlines by most measures? A new 777 and a hurried and botched branding exercise (Tails of Desperation) hardly are any indicators of improved customer service.

And why would LAN 787 spell disaster for IB? Not sure I follow the logic. Unless the new cash cow route pairing is something like a nonstop Asturias-Arica... but for everything else, the 330/340 combo should do well. There are two city pairs in LatAm that are Iberia's cash cows: MAD/EZE and MAD/MEX - and neither of them have LAN or TAM competing directly with IB.

Have you seen the new IB Business class cabin that made its debut last week at FITUR? Far superior to what LAN has installed on their 787s.

Regards,
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bagmanlgw
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 10:44 am

Now that the Iberia unions have announced their intention for a series of 24 hour strikes up to the end of Feb

Have they actually announced the dates for the industrial action and what time they intend to start from ?

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 11:45 am

Is Air Nostrum part of strike???, am flying with them in Feb, between MAD-TNG
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 12:03 pm

Quoting bagmanlgw (Reply 62):
Have they actually announced the dates for the industrial action and what time they intend to start from ?

The announcement will be made tomorrow, after a last meeting between the Unions and the company, but this meeting is considered "just a formality", and there is consensus among the Unions that an agreement with the company is already impossible. The *rumours* are there will be 5 consecutive days of strike, starting on Feb 18.

Source ( sorry, Spanish only ) :

http://economia.elpais.com/economia/...05/agencias/1360063556_897877.html

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 12:53 pm

Clearly IAG has no intention of backing down...

http://www.bloomberg.com/news/2013-0...in-in-taking-on-iberia-unions.html

Quote:
IAG Chief Executive Officer Willie Walsh pledged to push through job cuts at Spanish unit Iberia in the face of union opposition, pointing to his past record in slashing costs at British Airways and Aer Lingus Group Plc.

“We will reform Iberia and we will secure its viability,” Walsh said in London, adding that a move on Feb. 1 to go ahead with cuts without union agreement was the first of a number of “difficult” steps to be taken. “People can be confident we will resolve this issue. I’ve done it before and I’ll do it again.”

IAG is pressing on with a plan to shrink Iberia operations by 15 percent after the rejection of proposals that would have limited job losses to 3,147. While the capacity cut implies an initial workforce reduction of 3,500, analysts have said Walsh may need to eliminate more posts and cut pay if he’s to deliver a 600 million-euro ($814 million) earnings turnaround by 2015.

While Walsh previously faced down strikes to cut positions and wages at British Airways and as CEO of Ireland’s Aer Lingus, he said Iberia’s talks are being left to local executives.

“It’s the responsibility of the management at Iberia to do it and they’re the people that are managing the negotiations with the trade unions,” he said in an interview at the annual Business Travel Show in London. “They’re the people responsible for implementing the change, so they will continue to do it.”
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 2:28 pm

Quoting AR385 (Reply 17):
Quoting capri (Reply 63):

Is Air Nostrum part of strike???, am flying with them in Feb, between MAD-TNG

Air Nostrum and Iberia Express are not part of the strike. However, handling will be on strike, so they will be affected in some measure, as well as any other airline serviced by Iberia Airport Services at any Spanish airport.
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 2:54 pm

Suspect this is going to get messy, the Unions will figure they have nothing to lose and IAG will not want to be seen backing down, Just wonder if Iberia will see the year out. If not or it becomes very Bloody I can see BA getting the blame somehow, as said above IAG need to get the PR side sorted out sooner than later otherwise its just going to get very out of hand....
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 3:13 pm

You can see from the latest traffic numbers the stark difference in the traffic performance of the two airlines.

Worringly, Iberia's revenue is falling faster than the cuts in capacity and cargo, seen as a indicator of future passenger trends, is down by 17%.

http://phx.corporate-ir.net/External...YxfENoaWxkSUQ9LTF8VHlwZT0z&t=1

[Edited 2013-02-05 07:14:13]
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 05, 2013 8:30 pm

Quoting dcajet (Reply 60):
The job mobility that we enjoy here in the US, is something very unique to our way of life and economic system.

You missed my point. One has to be flexible and mobile to stay employed in this economy. I get it. Did you bother reading about the overall job situation (US isn't a great market, not as bad as Spain, but not great)? What I didn't mention is the number who are outside the Aerospace industry who have taken up jobs in Singapore, Russia, and even parts of Africa that make living in Spain look easy.

I get that they have it tough. Striking will only drive business to LAN/TAM, FR, and U2.

Quoting dcajet (Reply 60):
Care to explain to me what TAM/Lan have to do with all this? Iberia's woes have little to do with Lan or Tam.

Their hubs are taking traffic and high yield passengers. Despite domestic markets open to foreign competition, they thrive. LAN has rights in Chile, Argentina (being constrained), Brazil, Colombia, Peru, and Ecuador. What happens to IB when LAN starts flying to Europe from new cities? That is why I see them as the big threat. Not just what they are doing today, but in the environment and potential for groath LAN/TAM is in a very exciting place!

Hence why I say when the 787 issues are resolved, they will be tough competition.

Quoting dcajet (Reply 61):
1. Iberia only has the 320 family and 330/340 in house. What exactly do you mean by rationalize? Unless rationalizing for you means stuff made in Seattle....

Nothing with Seattle. You'll find I'm not A vs. B. What I mean is dump the A340s that are not on profitable routes and quickly replace them with aircraft that can be profitable at $96/bbl crude. Some of that will be with longhaul NEOs. The collapse in crude prices hasn't happened and to be blunt the A346s are tough at even a cheap $50/bbl (about as low as oil will go before oil fields are idled).

IMHO LH has already laid the groundwork to replace their A346s early with 748Is, A380s, and some A330s. We need to see such planning from IB.

Quoting dcajet (Reply 61):
2. I think Iberia is trying to do that...

Too slow. They must speed up the rationalization. There isn't just getting it right, but doing it fast enough to matter.

SLOW=DEAD

Quoting dcajet (Reply 61):
3. East of Spain - do you mean Italy, the Levant, Greece, China? Turkey? Russia?

I meant long haul and wrote that poorly. I mean India, China,Russia and possibly other Asian nations. IB should be taking advantage of their incredible South American feed to connect passengers onward or else others will do it for them.

Quoting dcajet (Reply 61):
4. AA improved its customer experience? Sorry but I need to laugh here, no offense

Before 2012 I would have laughed too. In 2012, my customer service experience on AA has been wonderful.

Quoting dcajet (Reply 61):
the 330/340 combo should do well.

Outside of hot/high,    A well managed airline like EK has fuel at 40% of their expenses. There just isn't any profit left with the A340s. Once the 787s are no longer grounded, much of the hubbing IB does on routes competing with LAN/TAN will be taken care of directly. (Or at least enough of the J class demand.)

Quoting dcajet (Reply 61):
Have you seen the new IB Business class cabin that made its debut last week at FITUR? Far superior to what LAN has installed on their 787s.

I'm sure it is a great hard product. Now get IB's 'soft product' to match their prices. What I've found is people are picky until their boss says 'fly the cheaper J or coach' and then they suddenly do not care so much about the seat.

IB is losing market share and money too quickly. Even the Spanish economy doesn't explain their woes relative to some peers. Even this reorganization isn't enough to compete long term as noted by LHRflyer. While South America is hurting, somehow LAN/TAM are doing ok while:

Quoting LHRFlyer (Reply 68):
Worringly, Iberia's revenue is falling faster than the cuts in capacity and cargo, seen as a indicator of future passenger trends, is down by 17%.

Gasp...

BA's tepid growth is masking IB's drop. But its only 10% drop in passengers... only...

Quoting acelanzarote (Reply 67):
Suspect this is going to get messy, the Unions will figure they have nothing to lose

They have everything to lose as you implied by wondering if they will see the year out. I do not think they are in that bad of shape.

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 12:45 pm

Quoting LHRFlyer (Reply 68):
Worringly, Iberia's revenue is falling faster than the cuts in capacity and cargo, seen as a indicator of future passenger trends, is down by 17%.

Iberia Express is not doing better. Although there is no previous stats to compare ( IB Express has only one year in the market ), the managers admitted they expected a higher number of pax for 2012, and the reality was 8 % under that expectations. Not surprising considering the branding problems that IB is facing.


http://economia.elpais.com/economia/...06/agencias/1360151097_572976.html

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 2:34 pm

Just on the news: 15 days strike, 18-22 February, 4-8 March, 18-22 March. This is what I call "caring for the passenger".
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 3:22 pm

Quoting spantax (Reply 71):
Just on the news: 15 days strike, 18-22 February, 4-8 March, 18-22 March.

Yep... certainly fighting the fire with fuel. When I started this thread I thought that " no less than 5 days of strike" could be called a "sensationalist title" for some people here... now they go for 15 days of strike...  Wow!

I understand at some degree the worker's dilemma ( strike = kill the airline and get jobless / don't strike = get jobless anyway ), but I really feel sorry for the thousands of passenger that will be the first casualties in this war....

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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 3:36 pm

I just read the article, totally crazy...

http://economia.elpais.com/economia/.../actualidad/1360158688_840644.html

I can only imagine what insane chaos this will create. Dreadful really for all parties involved, the owner, IAG, the employees, and the passengers.

IAG should be very clear with its employee unions: "the sole purpose of our existence is to maximize the wealth of our shareholders, within the guidelines of all appropriate regulations and agreements. We believe our measures will maximize the wealth of our shareholders and can be executed within the parameters of all relevant laws and agreements."

Why not just negotiate based on that statement? All cards on the table, chips fall where they may...
 
acelanzarote
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 4:14 pm

Not going to improve forward passinger bookings with Iberia then... just wonder where it will all end.
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 4:19 pm

Quoting spantax (Reply 71):

Nice way to cut your own throat.

Adios Iberia!
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 8:19 pm

Quoting spantax (Reply 71):
Just on the news: 15 days strike, 18-22 February, 4-8 March, 18-22 March. This is what I call "caring for the passenger".

That's NUCLEAR! In my prior posts, I thought it would be 5 days of strikes. Not 5 days in February, 5 in the start of March, and 5 more just to ensure March sucks for IB's passengers.

What is the risk of wildcat strikes? This is bad...

Quoting PDPsol (Reply 73):
Why not just negotiate based on that statement? All cards on the table, chips fall where they may...

IAG must cut staff. So the unions would still strike because... they could.

Quoting Gonzalo (Reply 72):
When I started this thread I thought that " no less than 5 days of strike" could be called a "sensationalist title" for some people here... now they go for 15 days of strike...

I don't think any of us thought they would go that far.

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AR385
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 8:24 pm

Quoting lightsaber (Reply 76):
That's NUCLEAR! In my prior posts, I thought it would be 5 days of strikes. Not 5 days in February, 5 in the start of March, and 5 more just to ensure March sucks for IB's passengers.

This is dangerous brinkmanship:

IB won´t survive this. The costs of acommodating those passengers, plus the revenue lost since as of now reasonable people won´t book IB, and not only for those days, constitutes an unsurvivable cash haemorraghe.

I find it also hard to believe thta the government has the political capital to invtervene in this, with the political crisis they are going through now.

I guess the ball is in IAG´s court now.
 
mfc
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 8:57 pm

Why they don't close down Iberia and create a "new" Iberia the next day? Didn't Swissair and Sabena do that? I don't know many details about the situation of that companies before their closure...
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LHRFlyer
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 9:59 pm

Total insanity.

When IAG management says they will do something they will do it. If they say industrial action by the unions will accelerate the shrinking of Iberia they mean it.

I suspect we will know of IAG's intentions by the end of the month.
 
Freshside3
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 10:02 pm

You would think, with the demise of Spanair, last year, IB would be doing well financially.
 
mfc
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 10:09 pm

Quoting LHRFlyer (Reply 79):
I suspect we will know of IAG's intentions by the end of the month.

I don't know exactly, what do you mean?
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 10:26 pm

Quoting mfc (Reply 81):
I don't know exactly, what do you mean?

IAG said last year when the restructuring was announced that the cash burn in Iberia must be stopped. One reason for this is that IAG has to review the value of its investment in Iberia for the financial year ended 31 December and if the cash burn detoriates IAG would have to write down the value of its investment in Iberia and take a financial charge in its accounts.

IAG made it clear yesterday that it would pursue action without union agreement to return Iberia to a cash flow neutral position by the middle of the year so they will not waste any time and I expect they will want clarity before IAG publishes its financial results for 2012 at the end of this month so they can reassure the market that the situation at Iberia is under control.
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Wed Feb 06, 2013 10:47 pm

Quoting mfc (Reply 78):
Why they don't close down Iberia and create a "new" Iberia the next day? Didn't Swissair and Sabena do that? I don't know many details about the situation of that companies before their closure...


Very interesting point. Perhaps somebody could enlighten us about these two cases in the framework of Iberia. Personally I wouldn't be shocked if this happens. Iberia has always been a kind of Francoist company: privileges for the personnel, endogamy, inefficiency, inflation of managers, promoting the inflation of unused-absurd airports all over the country, submissiveness of the State to the desires of the company (last example: T-4 in Barajas, a totally unnecesary operation that helped so much to the dire financial situation of AENA, the Spanish aviation authority, with a debt of around 15 billion EUR; somebody calculated that, if everything goes well, AENA could repay its debt in around 700 (sic) years). And as said before, even after the collapse of Spanair they were unable to take advantage of the situation to grow or to gain market.
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 12:32 pm

Quoting dcajet (Reply 61):

And why would LAN 787 spell disaster for IB? Not sure I follow the logic.

LAN-TAM are a limited threat today, but the biggest threat lies in their future expansion potential. IB would then be competing with a handful of A346's and A333's against a swarm of 787's (don't forget AV-TA will join the party too). Not a great future fleet strategy. It would help if IAG management promised employees a future 787/A350 order for IB, thereby giving them the hope that IB is long-term viable, which is something they have lost faith in today.

Quoting Gonzalo (Reply 70):
Iberia Express is not doing better. Although there is no previous stats to compare ( IB Express has only one year in the market ), the managers admitted they expected a higher number of pax for 2012, and the reality was 8 % under that expectations.

Not a surprise given that the expansion of the IB Express fleet has been blocked by a court. He does claim in a vague way that I2 has met its "financial objectives", whatever those are (but I assume it is too early to know if IBS is profitable). In any case, it is clear that IB short-haul can only survive in the form of I2 or VY. LH with 4U and AF with HOP are doing the same thing.

Quoting spantax (Reply 83):
even after the collapse of Spanair they were unable to take advantage of the situation to grow or to gain market.

They did : through VY which is growing and thriving at BCN. But I agree IB mainline short-haul was unable to take advantage due to its high cost base.
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 2:23 pm

Quoting AR385 (Reply 77):
IB won´t survive this.

They could. Its just a question of how large an IB.

Quoting AR385 (Reply 77):
I guess the ball is in IAG´s court now.

It is in the unions and IAGs court. Either could sink the company. IAG if that is the best ROI. The unions out of spite.
It really sounds like IAG has given IAG targets to meet with no choice but to meet them:
“It’s the responsibility of the management at Iberia to do it and they’re the people that are managing the negotiations with the trade unions,” he said in an interview at the annual Business Travel Show in London. “They’re the people responsible for implementing the change, so they will continue to do it.”
http://www.bloomberg.com/news/2013-0...in-in-taking-on-iberia-unions.html

To me this implies that IB management is about to get a haircut too. Either get in line with IAG's cost cutting or find a new position. Unfortunately, that is how it must be in this environment.

Quoting LHRFlyer (Reply 79):
Total insanity.

When IAG management says they will do something they will do it. If they say industrial action by the unions will accelerate the shrinking of Iberia they mean it.

   I hope IAG is very rational in their additional cuts. However, as already noted, it is their choice.

Quoting r2rho (Reply 84):
It would help if IAG management promised employees a future 787/A350 order for IB, thereby giving them the hope that IB is long-term viable, which is something they have lost faith in today.

Agreed. But before buying, the cost structure must be brought into line. IB is simply bleeding cash faster than IAG could invest.

Quoting r2rho (Reply 84):
LAN-TAM are a limited threat today, but the biggest threat lies in their future expansion potential.

   Well said.


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mfc
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 2:54 pm

Quoting spantax (Reply 83):
last example: T-4 in Barajas, a totally unnecesary operation

T-4 at Barajas is not unnecessary, Madrid Airport would have been saturated if T-4 hasn't been built. Iberia needed a hub style terminal, and now T-4 is where IAG can grow. There are no problems with MAD, BCN, PMI or ALC, where you can recover the money invested because they have enough traffic. The problem is with several regional airports like León, Santiago, Sevilla, Vigo and many more, that have been extended without necessity, just for political reasons.
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PlunaCRJ
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 3:37 pm

Quoting spantax (Reply 71):

Just on the news: 15 days strike, 18-22 February, 4-8 March, 18-22 March. This is what I call "caring for the passenger".

Is this still on? I just tried a dummy booking for February 22, and the flight appears as bookable. I would have thought that with a strike planned for these dates, IB wouldn´t continue to sell tickets on the affected flights.

Also, at least at first sight, I can´t find any reference to the strike on IB.com

Regards,
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 4:25 pm

Quoting PlunaCRJ (Reply 87):
Is this still on? I just tried a dummy booking for February 22, and the flight appears as bookable. I would have thought that with a strike planned for these dates, IB wouldn´t continue to sell tickets on the affected flights.

Also, at least at first sight, I can´t find any reference to the strike on IB.com

I doubt the IB management will allow any change in the website or booking system that can affect the sales. The Spanish newspapers and TV networks are giving enough warnings to the people who will travel those days.

Rgds.
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mfc
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 4:56 pm

Quoting PlunaCRJ (Reply 87):

Affected flights are to be announced. They have to arrange several things, once it is done, they will post the information on the website and will inform the passengers via e-mail, phone, social networks...

Iberia said this via twitter yesterday:

"Hemos recibido la notificación oficial de próximas jornadas de huelga convocadas por los sindicatos. Las fechas se indican a continuación: del 18 al 22 de febrero, ambos incluidos; Del 4 al 8 de marzo, ambos incluidos; Del 18 al 22 de marzo, ambos incluidos. Hasta no conocer los servicios mínimos, no sabemos que vuelos serán afectados. Tan pronto se conozcan, ofreceremos las mejores alternativas a los clientes afectados. Agradecemos vuestra paciencia."

In English (Google Translator):

"We have received official notification of next days of strike called by unions. Dates below: from 18 to 22 February inclusive; 4 to March 8, inclusive, from 18 to 22 March, inclusive. Until knowing minimum services, we don't know what flights will be affected. As soon as we know, we will offer the best alternatives to affected customers. We appreciate your patience."
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AR385
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Thu Feb 07, 2013 6:17 pm

Quoting r2rho (Reply 84):
LAN-TAM are a limited threat today, but the biggest threat lies in their future expansion potential. IB would then be competing with a handful of A346's and A333's against a swarm of 787's (don't forget AV-TA will join the party too). Not a great future fleet strategy. It would help if IAG management promised employees a future 787/A350 order for IB,

Don´t forget AM. AM will have a swarm of 787s too, and more than likely, they will have more frequencies on MEX-MAD, start MTY-MAD, GDL-MAD, CUN-MAD and restart MEX-BCN. While not a threat (yet) to its global Latin network, it will be in Spain-Mexico which is one of the most important IB destinations.
 
mfc
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 11, 2013 5:53 pm

So, we beat on, boats against the current, borne back ceaselessly into the past
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 11, 2013 7:39 pm

Quoting mfc (Reply 91):
Announcement made today:

Interesting that they are offering to return the money to every one who want. It will be very nice to know what proportion of the people who bought tickets for that time frame will choose that option ( I probably will !! )

Thanks for the update.

Rgds.
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LJ
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Mon Feb 11, 2013 10:00 pm

Quoting mfc (Reply 78):
Why they don't close down Iberia and create a "new" Iberia the next day? Didn't Swissair and Sabena do that? I don't know many details about the situation of that companies before their closure...

If they close it down, then IAG will loses everything it has invested in IB. Furthermore, it's questionable if the Spanish government can replace IB by a "new IB". Both Sabena and Swissair didn't have domestic competitors which are in the same business. IB does however has UX, which will block any "new IB" unless it gets something in return (which automatically means the "new IB" will be less attractive for investors). Finally, this strategy remains a very dangerous route.

Quoting AR385 (Reply 90):

Don´t forget AM. AM will have a swarm of 787s too,

So will UX (though they won't start getting them until 2015).
 
SCL767
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 7:46 am

Quoting r2rho (Reply 84):

Quoting dcajet (Reply 61):

And why would LAN 787 spell disaster for IB? Not sure I follow the logic.

LAN-TAM are a limited threat today, but the biggest threat lies in their future expansion potential. IB would then be competing with a handful of A346's and A333's against a swarm of 787's

Also remember that TAM is the launch customer for the A-350-900 in Latin America. LATAM Airlines has 27 A-350s, 4 B77Ws and 4 B763s on order, (plus 29 B-787s).
 
enginebird
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 8:49 am

Quoting lightsaber (Reply 69):
Nothing with Seattle. You'll find I'm not A vs. B. What I mean is dump the A340s that are not on profitable routes and quickly replace them with aircraft that can be profitable at $96/bbl crude. Some of that will be with longhaul NEOs. The collapse in crude prices hasn't happened and to be blunt the A346s are tough at even a cheap $50/bbl (about as low as oil will go before oil fields are idled).

IBs main problem are not the A346s, which are used profitably by other airlines such as LH, even at 100$/bbl. IBs problems are, among many other things, a terrible reputation, unbelievably bad customer service, a sub-par on-board product, the often unenthusiastic cabin crew and high personnel costs.

Best example is a recent flight SCL-MAD in October 2012: The only other airlines offering SCL-Europe, i.e. LA and AF, were fully booked and so I was forced to take IB. The overall experience was bad and it was no surprise that IB could not even fill half of the seats of the A343 used that day, while IB's competitors' planes were full. A half empty A34x is not much worse than a half empty B777.
 
spantax
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 12:02 pm

Breaking: IAG announces 3 807 layoffs in Iberia (19% of the workforce) according to newspaper El País.
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LHRFlyer
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 12:17 pm

This is confirmed in the IAG press release. As I said above, IAG do not bluff!

http://www.iairgroup.com/phoenix.zht...-newsArticle&ID=1784018&highlight=

Quote:
IAG UPDATE ON IBERIA TRANSFORMATION PLAN

International Airlines Group announces that Iberia has today informed its employees, trade unions and the Spanish Employment Ministry that it has started the formal process of collective redundancy. 3,807 jobs in the airline are affected. There will now be a 30 day consultation process.

This is part of Iberia's transformation plan to introduce permanent structural changes across the airline to stem its losses enabling it to grow profitably in the future.
 
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 12:44 pm

Quoting spantax (Reply 96):
Breaking: IAG announces 3 807 layoffs in Iberia (19% of the workforce)
Quoting LHRFlyer (Reply 97):
This is confirmed in the IAG press release. As I said above, IAG do not bluff!

Ufff !!! Certainly this is not going to stop the strikes.... I wonder how the unions will react to this...but definitely I will not be very calm if I had a flight booked with IB this days...

Rgds.
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RE: IB Unions Announce "no Less Than 5 Days Of Strike"

Tue Feb 12, 2013 1:05 pm

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