As the post-COVID recovery scenario is still slow in Spain, Iberia considers essential that the extension of the state-managed employment aid continue including the airline industry.
Although Ryanair assured this week that the prospects for the autumn and winter were better than expected and the United Kingdom has lowered the requirements to fly to other countries, the sector continues in a precarious situation. As a result, Iberia is seeking an extension of its Expediente de Regulación Temporal de Empleo (ERTE). The ERTE is a labor flexibilization measure that enables the company to reduce or suspend employment contracts.
IAG registered 2,048 million euros of losses in the first half of the year, bringing the group’s debt to around 12,000 million. As per El Confidencial, sources point out that while Iberia has operated 65-70% of their available capacity in 2019, aircraft occupancy and revenues have been closer to 50%. The airline does not expect to recover to pre-COVID-19 levels before 2023.
In any case, Iberia needs to continue to implement adjustment measures, as it informed its unions last Friday. Airline capacity is now 35% lower than in 2019. This is mainly due to restrictions on tourism with the United States, Latin America, Japan, and China.
