Iberia eyes Europe-Latin American alliance

Iberia (IB, Madrid Barajas) is considering establishing an alliance to operate in the Europe-Latin American market airline Chairman and Chief Executive Officer Luis Gallego Martin has revealed.

Speaking to Airline Business, Gallego said the IAG subsidiary is looking to replicate the trans-Atlantic joint venture which sees fellow Oneworld alliance members Finnair (AY, Helsinki Vantaa), American Airlines (AA, Dallas/Fort Worth), British Airways (BA, London Heathrow), and Iberia cooperate on flights between Europe and North America.

While Gallego did not specify which other airline Iberia is considering for potential membership in the joint venture, Spain's Preferente tourism paper has flagged LAN Airlines (LA, Santiago de Chile Int'l) and TAM Linhas Aéreas (JJ, São Paulo Congonhas) parent, LATAM, as a strong contender. The South American operators are both oneworld members and already have codeshare agreements in place with Iberia.

Iberia currently serves Bogotá, Buenos Aires Ezeiza, Cali, Caracas Simón Bolivar, Guayaquil, Lima Int'l, Medellín José Maria Córdova, Montevideo, Quito Int'l, Rio de Janeiro Int'l, Santiago de Chile Int'l, and São Paulo Guarulhos. 

Since resuming a number of abandoned South American routes - which will include Santo Domingo Las Américas, Asuncion and Havana Int'l - Iberia has seen its Europe-Latin American market share climb to 22.9% as compared to 20% of rival Air France-KLM Royal Dutch Airlines which has suffered heavily at the hands of a struggling Brazilian economy.

As such the carrier intends to use the alliance to enhance profitability on routes where it is already dominant while consolidating its position in the face of competition from the Franco Dutch carrier group as well as Air Europa (UX, Palma de Mallorca Son Sant Joan) to a lesser extent.