Axe poised over 7,000 jobs in Iberia restructuring plan
Iberia, the Spanish airline that merged with British Airways to become International Airlines Group (IAG) last year, is to axe up to 7,000 jobs tomorrow, union bosses have warned.
IAG will post third-quarter results tomorrow and is expected to set out major restructuring plans at its Spanish carrier, which has some 20,000 employees.
The group unexpectedly issued a profits warning in August after the eurozone crisis smashed demand for seats at Iberia and forced up the cost of fuel.
Its chief executive Willie Walsh admitted the business would not break even, as previously forecast, but post a loss for this financial year and said: "It's a tale of two companies. British Airways did reasonably well but Iberia performed poorly and needs the type of restructuring BA went through a few years ago."
Yesterday a spokesman at CTA, the union for land-staff personnel for Iberia, said: "We have been summoned for Friday and the only thing we know is that they want to announce a massive staff layoff plan."
In the first half of this year at IAG, BA made a €13m (£10m) operating profit, but that was more than wiped out by Iberia racking up an operating loss of €263m.
Mr Walsh said this summer: "We are undertaking a fundamental review of every aspect of business at Iberia. It is inevitable that there will be job cuts. Some routes may go, too."
IAG shares drifted lower this week after analysts flagged up the state of Iberia's problems.
Liberum Capital analysts warned restructuring the Spanish carrier "will take time and money" and expects Iberia's third-quarter losses to exceed €400m this year. They forecast restructuring the airline could amount to a cash cost of €300m.
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