Iberia to implement cost cutting measures, improve productivity

Iberia recently announced it will take effective measures to make the airline more competitive and strengthen its position further in the market.

The airline said in a statement that it wants to become highly competitive and ensure viability amid a deepening economic crisis accentuated by weak demand, high fuel prices and fierce competition.

Iberia flights had to be cancelled several times in recent past because of strikes by its pilots, who had been strongly opposing the launch of a low-cost carrier by the airline.

The airline says that its operations have been severely impacted due to strikes held since December last year by the SEPLA pilots union, which cost the company nearly 3 million euros per strike day.

Iberia said that the measures are being implemented to reduce the airline’s unit costs and to raise productivity. The pilots’ payroll costs will be cut by 20 percent or 62 million euros. Apart from this, the productivity will also be increased by 25 percent.

These measures will apply to pilots only as they have so far failed to reach an agreement on a new union contract. The airline is taking these steps after more than two-and-a-half-years of negotiations with the agitating pilots. The airline wants that the pilots also agree to its terms in a similar way as those already agreed by ground staff and cabin crews.