So much for Virgin Atlantic's competitive motto of "NO WAY BA/AA". Seems the European Union has approved the merger of BA and Iberia and the subsequent expansion of the relationship with American. The net result will be deeper ties between the carriers and a larger penetration of the European and American markets. Associated Press reported the story below.
It will be interesting to see how the coordinated flight schedules will impact air freight space availability especially in crowded markets like the Latin American trades where American has a significant presence as does Iberia.
BRUSSELS -- British Airways and Iberia won the European Union's regulatory approval to merge and to team up with American Airlines to share more of their lucrative trans-Atlantic routes.
British Airways' merger with Iberia will create Europe's third-largest airline with a market value of around $7.5 billion pounds. They will keep their existing brand identities and claim the deal will create savings of euro400 million ($530 million) a year by the fifth year.
BA and Iberia also plan to expand their oneworld alliance with American Airlines, which currently coordinates how they sell and operate flights between the 27-nation European Union and the United States. They will now also jointly manage schedules, capacity and pricing on flights from Canada, Mexico, Puerto Rico, Norway and Switzerland as well.
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