IAG hails ‘landmark’ deal with Iberia pilots union

Iberia parent International Airlines Group hailed the agreement as a “landmark” to introduce permanent structural change and improve the airline’s viability.

IAG said it would result in a “new positive” working relationship between Iberia and SEPLA after years of conflict.

“This landmark agreement provides a strong foundation to put Iberia on the path towards sustainable profitable growth,” IAG said. “It will also enable Iberia to become more competitive and reduce its cost base. “

The main impacts of the agreement are:

• Fundamental productivity improvements within Iberia.
• Salaries to remain frozen until 2015. After that date, increases will be subject to the airline’s profitability.
• An agreement providing a 14% salary reduction for pilots and an additional 4% cut linked to the productivity agreement. With these productivity improvements, the 4% will be returned.
• The faciliation of growth of Iberia and Iberia Express.

The agreement in principle is subject to the approval of SEPLA’s general assembly.

Iberia executive chairman Luis Gallego said: “This groundbreaking deal reduces the cost structure and provides the foundation for the airline to grow profitably.

“A strong and profitable Iberia can protect jobs in the long term and boost tourism, which is a key driver in Barajas’ [Madrid airport] and Spain’s economic recovery.

“Iberia is the natural airline choice for Latin America and this agreement will enable it to be a formidable competitor and build on its new brand, providing customers with great service and an extensive network.

“This agreement also enables the growth of Iberia Express with a competitive cost base and provides promotion opportunities for current Iberia and Iberia Express first officers.

“Iberia Express will help make Iberia profitable and stronger, by providing short-haul feed, and will provide Spanish competition to low-cost carriers.”

IAG chief executive Willie Walsh said: “‘Luis Gallego, his team and SEPLA deserve congratulations for striking a bold deal that will mark the turning point in Iberia’s future.

“Luis has deservedly won the respect of the industry, his colleagues and the trade unions.

“Permanent structural change was the only way to save Iberia from slow decline. This agreement marks the beginning of its future.”