International Consolidated Airlines - $IAG.LN

What’s International Consolidated Airlines Business Model?

International Consolidated Airlines Group S.A. provides transportation services. The Company offers international and domestic air passenger and cargo transportation services. International Consolidated Airlines Group serves customers worldwide.

What International Consolidated Airlines is doing in more details?

International Consolidated Airlines Group (aka International Airlines Group or IAG) is a major European airline group that brings together the flag-carrier airlines of Britain, Spain, and Ireland.

The company was born out of the 2011 merger of Britain and Spain’s flag-carrier airlines, British Airways (BA) and Iberia; Ireland’s Aer Lingus and low-cost Spanish carrier Vueling later joined.

IAG’s subsidiaries continue to fly under their own brands and boast a combined nearly 600 commercial aircraft that carry around 118 million passengers to about 280 destinations around the world each year. IAG’s hubs are London Heathrow, Madrid Barajas, and Dublin Airport.

IAG leverages excess hold capacity to offer cargo services. About two-thirds of revenue comes from its international operations.

Where International Consolidated Airlines is Operating?

IAG generates revenue from two principal sources, passengers and cargo. Its combined passenger activities under the British Airways, Iberia, Aer Lingus, Vueling, and Level brands account for nearly 90% of total sales.

Cargo services account for less than 5%. The remaining revenue comes from MRO (maintenance, repair, and overhaul) and services.

IAG’s fleet consists of mainly Airbus planes of various types and sizes as well as several Boeings and a couple of small Embraer models flown by BA.

Where is the geographical reach of International Consolidated Airlines?

British Airways operates from its main hub in Terminal 5 of Heathrow Airport, reaching domestic, short-haul, and long-haul destinations. It has a particular strength in transatlantic flights, including JFK-Heathrow, the world’s most lucrative route.

Madrid-based Iberia is the leading airline between Europe and Latin America as well as Spain. In addition, Vueling offers a wide network to Spain, Italy, Europe, the Middle East, and Africa.

IAG generates a third of revenue from the UK, a sixth from both Spain and the US, and another third from all other countries.

What isInternational Consolidated Airlines’ Sales and Marketing Strategy?

IAG’s Avios frequent flier program has around 8.7 million members.

British Airways and Iberia are member of the OneWorld airline alliance alongside American Airlines, Cathay Pacific, Qantas, and Qatar Air, among others. OneWorld is the second largest air alliance after Star Alliance.

What is International Consolidated Airlines Financial Performance?

Revenue for the year ended 2019 totaled ?25.5 billion, a 5% increase compared to the previous year. Passenger and Other revenue contributed to this growth.

IAG’s net income for the year ended 2019 totaled ?1.7 billion, a 41% decrease compared to the previous year.

AIG’s cash for the year ended 2019 was ?4.1 billion. Operating activities generated ?4.0 billion, while investing activities ?2.7 billion, primarily for capital expenditures. Financing activities used another ?1.3 billion, mainly for repayment of lease liabilities.

What is International Consolidated Airlines Future Strategy?

The first strategic priority for the Group is to strengthen its portfolio of world-class brands, particularly through continuous improvements in net promoter scores across the Group airlines, by looking across each of the elements of the customer journey.

The second strategic priority for IAG is growing its leadership positions, heading the consolidation of the airline sector, either through acquisitions or developing joint businesses that help the Group grow its global reach, for example, the proposed Air Europa acquisition or joint business agreements, such as the British Airways joint business with China Southern.

Lastly, the Group’s third strategic priority is enhancing IAG’s common platform, improving efficiency and focusing on digital and innovation.

What are International Consolidated Airlines’ Mergers and Acquisitions?

In late 2019, AIG agreed to buy Air Europa for ?1 billion, the deal will transform the Madrid hub into a true rival to Europe’s four largest hubs: Amsterdam, Frankfurt, London Heathrow and Paris De Gaulle.

Air Europa is a Spanish airline operates flights to over 40 destinations across Europe, Asia and North and South America. It has fleet size of more than 50 aircraft, ranging from 49 to 388 seaters consist both Boeing and Airbus aircrafts.

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