Iberia Case Study

Topics: British Airways, Ryanair, London Gatwick Airport, Aer Lingus / Pages: 11 (1123 words) / Published: Jun 3rd, 2014
IBERIA CASE STUDY Iberia was founded on June 28, 1927 by Horacio Echeberrieta. It was not only Spain’s first airline, but also the first to fly between Europe and South America (as of 1946), the first to establish a walk‐ on air shuttle service (between Madrid and Barcelona), and the first in Europe to offer an international frequent flyers customer loyalty programme (Iberia Plus).
In 2001, on April 3, Iberia’s privatization process was completed, when its shares were listed for the first time on the stock exchange. The following year Iberia was included in the selective Ibex‐35 stock market index. Today Iberia is an international transport group operating in around 100 airports. IBERIA’S POSITION SHORTLY AFTER PRIVATISATION (2002)
Although Spain is not a major airline hub, it is a rapidly growing market:

Iberia case study


Iberia revenues are split roughly 1/3, 1/3, 1/3 across three market segments: Domestic, European and Long haul/Intercontinental:

Spain has more domestic passengers than any other European country. Its large size and relatively undeveloped road and rail infrastructure outweigh the impact of being smaller in population than some other countries. The case majority of customers fly point to point (i.e., not through a hub such as Madrid). The domestic market has relatively few competitors on most routes, but is forecast to decline due to improvements in motorway and rail links. Iberia enjoys market shares of 50‐60%, and 85% in the premium segment. It has good relationships with the local airports and related local government and this allows it significant influence over departure times, gates and plans for airport expansion and modification.

The European market is also large in Spain. Germany‐Spain has the largest number of flights of any two European

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