MIAMI – In an interview with El Pais, Iberia (IB) CEO Luis Gallego addresses the challenges of the next few years. Among the changes expected is the removal of the A340-600 from IB’s fleet.
Luis Gallego was to replace Willie Walsh as IAG CEO in March, but the handover has been shifted to September due to COVID-19.
Gallego states that while travelers are losing their fear of flying, complete recovery is years off. Thus, airlines will need to adjust their size and capacity accordingly.
Border Closure and Reopening
Gallego states that the WHO’s recommendation was correct, as the health of people should be paramount, so closing the borders was the way to preserve lives.
However, for the reopening of borders, the CEO states that coordination needs to be strong between EU countries.
Gallego specifies that organization in the bloc is needed not just for preventing quarantine in some countries or looking out for a reemergence of the virus but also keeping consistent and clear rules and information for travelers.
In the area of financial aid for airlines, Gallego states that he supports aid for companies that have a strong future plan. He has concerns about aid for airlines that do not have a viable future, as that will distort the market during the recovery.
Iberia itself was losing €7m a day during the Pandemic. However, compared to other airlines, IB had started its downsizing process in 2013, so it was in a stronger position than other airlines before the crisis.
Even though IB had started downsizing in 2013, further is still required. In this regard, Gallego said he wanted to see the ETRE temporary layoff scheme until December 2020.
Repaying the €750m loan is also high on his list. Gallego stated several times during the interview that regaining passenger trust is of the highest priority.
The removal of the A340-600 from the fleet is another part of IB’s plan. The renewal of fleets to make them more sustainable help airlines not only with costs but also the rest of the supply chains and aircraft manufacturers.
Finally, according to the CEO, the connection of airports to other forms of transport such as trains needs to be prioritized. Gallego brings the example of T4 at Madrid Barajas and the AVE.
Outside Investment in Spain
With Spain having been hit hard by the pandemic and subsequent crisis, Gallego believes that through education and good employment, Spain will again be popular for investors.
Gallego said, “In order for [international investors] to believe in us, we need to believe in ourselves, even if it is not always evident.”
Iberia and Air Europa
At the end of 2019, IB was planning on purchasing Air Europa; however, with the health crisis, the purchase has been put on hold.
Gallego states that the purchase still makes sense, but needs to be evaluated with regards to the pandemic and its effects on the Spanish flag carrier.