Yesterday (7th May 2020) International Airlines Group (IAG) posted Q1 losses of $597 million USD. This compares with operating profits of $146m over the same period in 2019.
The company also announced that it expected a “meaningful return” to service in July. During the financial announcement it was also announced that IAG went into the crisis with $9bn in cash and undrawn credit.
They also have received £300m from the British government and £900m from the Spanish government.
IAG comprises British Airways, Iberia, Vueling, Aer Lingus, and the recent low cost carrier Level. Due to its reliance on business passengers it is expected that British Airways will be worst hit, taking the majority of job losses.
As part of these cuts British Airways has formerly informed unions regarding a planned restructuring, as required by UK law.
IAG has also announced that Willie Walsh will be replaced as CEO by Iberia CEO Luis Gallego.
Gallego previously ran Iberia Express, a low-cost carrier owned by Iberia until becoming Iberia CEO in 2014.
Walsh had been due to step down from the post in March however the Covid-19 pandemic has meant this has been delayed until 24th September.
In post since January 2011, Walsh was previously CEO of Aer Lingus and British Airways. He oversaw the merger of the later with Iberia to form IAG in 2011.
The sheer size of IAG means that it is likely to come out of the current crisis in a better position than rivals. The economies of scale that IAG can reach are much greater than the majority of airlines.
This, coupled with the fact that the group comprises three national airlines should mean long-term success for the group.
Nick Ashwell-Rice has worked in aviation and defence journalism since 2014 whilst also maintaining a career outside of the industry. He has been Editor-in-Chief at Talking Aero since its inception