HomeAir LineThe sale of Air Europa to IAG does not worry anyone

The sale of Air Europa to IAG does not worry anyone

The European Commission has on the table two files for the purchase of European airlines by European airlines: the incorporation of Air Europa into IAG and, also, that of Ita to the range of Lufthansa subsidiaries (Purchase of Air Europa by Iberia: Brussels resumes the analysis ).

In the Spanish case, there is no one who opposes it. Nobody in Spain, of course. Not even in Europe. Neither Lufthansa nor Air France, IAG’s major competitors, have anything to say because they themselves are immersed in similar operations. In fact, Carsten Sphor, Lufthansa’s chief executive, publicly spoke out in favor. In the case of Ita, Air France’s position is not so unequivocally favorable, because the power that Lufthansa acquires on certain European routes could be too great, but it has not taken a position (Italy: “Europe has gone crazy against Lufthansa and Ita “).

The problem with the two operations could have come from the European regional companies, which do not seek routes with either the United States or South America. Fundamentally one, the leader, Ryanair. But the head of Ryanair has also positioned himself in favor. Because he knows that both the absorption of Ita and Air Europa will allow slots to be distributed so that Ryanair can grow in Madrid or Milan. Easyjet naturally thinks the same, looking especially at Linate. And even Volotea and Binter believe that something is always going to happen to them (Ryanair: “We would like to open 40 or 50 routes in Madrid”).

There is an argument intelligently put forward by the major European companies: if there is no consolidation, if the three major European intercontinental companies do not grow, they have no future. Because Europe is small in the global arena and, because in that situation, it is ridiculous to have dozens of weak airlines. There is already a lot of competition at a global level, but not with Air Europa or Ita but with Turkish, Qatar, Emirates, American, Delta, China Southern or even Japan Airlines.

Why should the European Commission make enemies by defending a concept of competition that is not written anywhere?

By consumers. It is obvious that in the case of domestic routes, IAG assumes that it will have to give up slots. Furthermore, the disappearance of Air Europa or its incorporation into the Iberia brand, or its control by IAG, will mean that on many routes with South America there will be a very powerful dominant position. And that will have an impact on prices. But of course, the Latin American traveler is not on the list of European political priorities.

And, furthermore, it can always be said that for decades, Iberia had a near monopoly on the routes between South America and Europe. At one time it competed with Varig and Lan Chile; then with Tam and finally with Latam. It is impossible to compete with Aerolíneas Argentinas because their kingdom is not of this world and commercial aggressiveness is not their thing. The rest, Air Madrid, Spanair, BoA, Pluna or even Avianca, have had limited power to compete, especially because they cover very few airports. To Montevideo, Quito, Lima, Caracas or most of Central America and the Dominican Republic, for a long time, you could only travel with Iberia from Madrid. If not, you had to go through Paris, Miami or New York, which was a crazy adventure.

That is to say that politically, at the table of the European Commission there are hardly any arguments against the absorption. You just have to save face and make an interpretation of the concept “competition” a little lax. Because nowhere does it say how many airlines have to fly to a place so that it can be said that there is competition; Nor does it say anywhere what market share is exclusive. Only Easyjet flies on countless European routes. Or just Ryanair. Or just a ‘legacy’, without anything happening, because this thing about competition in the end is indefinable.

From the point of view of public relations, a matter of the highest priority for Brussels, IAG has played well: it has not made noise, it has been docile, willing to follow instructions, assuming that it will have to give up routes , especially in the short European radius. The fact that Air France is promoted to Latin America is less funny, although Barajas’ position, in this sense, and the power of the migratory flow from South America to Spain, always favors Iberia and Air Europa (Iberia’s strategy to take over Air Europe).

Source: Preferente



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