Unlikely but possible: Walsh on IAG, British Airways split
The European airline holding company International Airlines Group (IAG) (IAG)came into being via a merger of British Airways and Iberia in 2011. However, despite being one of the two founding companies, the UK’s flag carrier appears far from sacred, and could be cut loose if need be, former Chief Executive Officer of IAG and British Airways Willie Walsh explained.
British Airways could be sold off by its parent company IAG to facilitate the financial situation of the group, Walsh hinted when speaking to the Sunday Telegraph on June 12, 2021. The ex-boss of the company, who ran the airline between 2005 and 2011 and moved on to lead IAG until 2020, emphasized that he was not inclined to think that such a step would be taken by the parent company, but believed that the possibility remained.
“There’s nothing to say that bits of IAG could not be sold off or cut loose. [...] That was always my thinking when I was there. If one part of the business wasn’t performing, or was underperforming, or didn’t make sense, then you could dispose of that part of the business,” Wash was quoted saying.
“I don’t think that will happen, but it could happen,” Walsh emphasized.
What could lead IAG to cut British Airways loose?
The UK government categorizes foreign countries in three color-coded groups: green, amber, and red list countries. The green list exempts travelers from quarantine on return to the UK. Travels coming back from countries on the amber list, which is the most active category, are required to undergo self-isolation for ten days upon return to the UK, while international travelers that transit through red countries are refused entry into the UK.
Fifty countries are currently included in the red list, while the amber list contains 177 countries and territories, including the United States. The green list, on the other hand, has only 11 countries. The travel industry in the United Kingdom is currently almost at a standstill ‒ a situation for which the government’s traffic light system is harshly criticized by various industry bodies, including those representing the country’s airlines and airports.
Walsh, too, showed his dissatisfaction with the UK government’s system. The former IAG boss argued that the airline industry hoped for eased transatlantic travel restrictions in the summer season of 2021, allowing air carriers to resume long-haul operations.
“I don’t think you can describe the traffic light system [in the UK] as being in any way effective, you know, it’s stuck on red. [...] They’ve already abandoned the criteria that they had set out where they clearly stated that they would give people a fair warning if the lights were going to change…[...] Then to pull the rug from underneath people in the way they did, I think was very, very poor, and demonstrates that they’re really not thinking about consumers or the public, ” Walsh told the Sunday Telegraph.
Meanwhile, as international borders remain closed due to the pandemic, British Airways is furloughing back part of its workforce. Staff who had been already brought back from furlough by the airline returned onto the government wage support scheme.
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