Air Europa seeks to implement temporary layoffs and merger with Iberia threatened
Spanish tourism group Globalia said it was looking to implement a temporary layoff plan (Expediente de Regulación Temporal de Empleo, ERTE) fearing a drop in demand during the fall-winter (boreal) season. The measure will affect some 9,000 employees, or 60% of the total.
According to El Confidencial sources, Globalia intends to initiate a negotiation process with the unions to apply an ERTE for economic reasons (called ETOP) in all of the group’s subsidiaries due to the drop in post-holiday bookings. and the lack of guarantees for the extension of ERTEs approved by the Spanish government during the pandemic.
In the case of Air Europa, the crisis impacted its long-haul flight operations due to health restrictions in its most important markets in Latin America: Argentina, Brazil and Peru, and in North America to the United States. . The airline was involved in the controversy over government aid from the Sociedad Estatal de Participaciones Industriales (SEPI), which granted it loans of 475 million euros.
Air Europa employees, including cabin crew, pilots and ground crew, rejected a further 6% pay cut months ago. The union questioned the adjustment, citing the high salary of the new member of the company’s board as an example.
Iberia, which is part of the International Airlines Group (IAG), is also in negotiations with unions to include more than 5,000 employees.
Threatened Iberia-Air Europa merger
The economic situation of the main Spanish long-haul operators could call into question the acquisition of Iberia by IAG and the merger of Air Europa to strengthen their operations at Adolfo Suarez Madrid-Barajas airport.
The European Union, through the Commission for the Defense of Competition, has also indicated that there are other difficulties to be resolved in relation to the dominant position that the cooperator would have on the Spanish market. One of the decisions would be to cede slots (landing and take-off slots) to low-cost competitors like Ryanair, which would hurt operations and eliminate the competitive advantage, making the idea of the merger less attractive.