Iberia planning to launch new low cost carrier

Iberia announced that it is planning to launch a low cost carrier soon. Airline is aiming at improving its profitability further. However, the board of the Spanish airline Iberia said that the move to introduce another low cost carrier might face roadblocks initially leading to industrial action by the affected employees.

Iberia is now owned by International Airlines Group (IAG), which also operates British Airways. The airline has stated that it is actively considering launching a budget carrier to operate short and medium-haul flights.

However, Iberia fears industrial action by pilot union which has alleged that the airline is likely to outsource some of its jobs pertaining to its domestic flights and has threatened to go on strike. Besides, Iberia is also facing a tough competition from its European low cost rivals EasyJet and Ryanair.

Meanwhile, in another development, Iberia airlines has announced that it is all set to begin a retrofit program for 17 Airbus A340-600s in 2012. The program is scheduled to begin in mid-October next year at its maintenance facility in Madrid. The airline said that the average age of its fleet is nearly 4 years. Iberia has decided to retire its A340-300 fleet after its new A330-300s start arriving in 2015.