Case 16
• THE RESTRUCTURING OF IBERIA: A FLIGHT PLAN PLAGUED BY TURBULENCE
Rocío González Sánchez
Sonia Medina Salgado Universidad Rey Juan Carlos
.: Index
16.1. INTRODUCTION: A BRIEF HISTORY
16.2. THE SPANISH AIRLINE INDUSTRY IN THE NEW MILLENNIUM
16.3. THE MERGER WITH BRITISH AIRWAYS: THE BIRTH OF IAG 16.3.1. Background
16.3.2. Process
16.3.3. And after the merger…
16.4. THE RESTRUCTURING OF IBERIA 16.4.1. The 2012-2015 transformation plan
.: Case overview
Through to the end of 2013, Iberia, the flagship of the Spanish airline industry and part of the IAG holding, has recorded the sharpest downturn in its income statement and cashflow since it was created in 1927. There are numerous factors that have led to this situation; these include a significant fall in the number of bookings, the greater use of high-speed trains, a steep rise in airport taxes, and the major expansion of low-cost carriers, all of which have been played out against a backdrop of profound economic crisis. The current scenario has forced Iberia to adopt a restructuring plan, financed through its own resources in order to reduce its cost base and return to profit, which is proving to be difficult to implement.
.: Objectives
• Analyse Iberia’s restructuring strategy and the impact of its conflicts with stakeholders
• Reflect upon Iberia’s strategic errors and the merger process
• Analyse the strategic changes made in Iberia following the latest corporate operations
