Iberia withdraws from British Airways deal

Iberia to concentrate on its clientele and delay negotiations over the fusion with British Airways until the autumn

Fernando Conte, the President of Iberia, has withdrawn from negotiations over the possible fusion with British Airways. Future plans with regards to this have been put on hold until later this year. He said that the British Airways’ pension fund which currently has a deficit of 1.2 million (1,290 million euros) would need to be revised in September.

Conte also said that improving its service to its clientele was of now of utmost importance to Iberia. He recognised that improvements could be made especially during the present climate in which all airlines were fighting to win over more passengers. He announced that Economy class facilities would be renewed and ways of improving Business class would also be studied.

Conte warned that if the ‘dramatic crisis’ continued more cuts would have to be made in capacity and in its workforce and that more redundancias would have to be made. Iberia is currently in negotiations over temporary redundancies covering 10% of its workforce.

Commenting on the government’s plans to freeze airport taxes in Conte said that airport taxes were reasonable but that navigation taxes were unacceptable.