Spanish airline Iberia, now part of the International Airlines Group along with British Airways and Vueling, has said this week that it had reached a deal with the SEPLA pilots union to reduce their salaries by at least 14%.
As part of IAG´s plan to compensate for its accumulated 850 million euro losses between 2008 and 2012, largely attributed to high fuel costs, a sharp economic downturn in spain and high operating costs, the agreement will see the 1,400 pilots have their salaries reduced by 14% immediately, with the option of another 4% drop depending on the airline's profitability.
Iberia's executive chairman, Luis Gallego, said in a statement, “This groundbreaking deal reduces the cost structure and provides the foundation for the airline to grow profitably. A strong and profitable Iberia can protect jobs in the long term”.
The International Airlines Group, or IAG, is now one of the world's largest airline groups and is a British-Spanish multinational airline holding company with headquarters in London, United Kingdom and with its registered office in Madrid, Spain, with 435 aircraft flying to 230 destinations and carrying 67 million passengers each year. It is the third largest group in Europe and the sixth largest in the world, based on revenue.
The announcement had an almost immediate impact in shares with the group, seeing a 1% rise during the first day of trading.
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