Spanish flag carrier Iberia will resume flights between Madrid and Montevideo, the capital and largest city of Uruguay, from September this year, just 15 months after it closed the route as part of parent company International Consolidated Airlines Group’s comprehensive business plan to return Iberia to sustainable profitability after record financial losses.
The confirmation of the return of the route will now place the carrier in direct competition with its local rival Air Europa which inaugurated its own operations between Madrid and Montevideo in June 2013 just three months after Iberia ended its flights. The Madrid – Montevideo route is the only non-stop service linking Uruguay to Europe and Iberia will offer a four times weekly schedule when it returns to the market from September 1, 2014.
“Iberia wants to connect Uruguay and Europe. We are the leading airline between Europe and Latin America, we offer the best service, the largest network of destinations and the most efficient connections,” said Antonio Pimentel, director of alliances, Iberia.
Alongside its return to Uruguay, Iberia has also recently announced that it would resume flights to Amsterdam, Istanbul and Santo Domingo this year. These routes were all also closed in 2013 as part of its restructuring process. It has also confirmed it will boost capacity to Panama City with the introduction of a sixth weekly rotation from June 2, 2014 and then a seventh from July 6, 2014, providing a daily operation.
The other service resumptions will come online from June with daily flights between Madrid and Istanbul commencing on June 20, 2014; two daily flights between Madrid and Amsterdam will be flown by low-cost partner Iberia Express from July, with a third daily rotation being added from September 1, 2014; while from the same autumn date the five times weekly link between the Spanish capital and Santo Domingo will be resumed. The new flights follows the recent opening of Iberia Express’ Madrid – Stockholm link, which will move to a daily operation from September 1, 2014 and confirmation that summer flights to Athens will be retained for the winter schedule.
The network changes suggest that International Consolidated Airlines Group’s restructuring of the Iberia business is proving successful. Iberia was struggling to keep its head above the water as legacy contracts and increased competition in the short-haul market from low-cost carriers has meant it has found it difficult to compete.
The transformation plan has introduced permanent structural change across all areas of the business with the aim of stemming losses and included a reduction of its fleet, and resultant network cull and a significant number of job losses as the carrier reduced in scale.
In our analysis below we look in greater detail at passenger demand into Uruguay and the important role the Madrid – Montevideo connection plays in transporting passengers between Europe and the South American country.