IAG share price: British Airways parent launches low-cost transatlantic airline

New budget carrier Level to take to the skies in June

IAG share price: British Airways parent launches low-cost transatlantic airline

British Airways and Iberia parent International Consolidated Airlines Group (LON:IAG) is launching a new long-haul budget airline based in Barcelona, the company has said. The airline is set to compete with low-cost transatlantic carriers such as Norwegian.

IAG’s share price has been little changed on the news, having added 0.18 percent to 572.00p as of 13:20 GMT, slightly underperforming the broader London market, with the benchmark FTSE 100 index currently standing 0.38 percent higher at 7,444.37 points. The group’s shares have gained nearly four percent over the past year, and are up by just under 30 percent in the year-to-date.

IAG, which also owns Aer Lingus and Vueling, announced in a statement today that it was launching Level, a new low-cost airline, with flights from Barcelona to Los Angeles, San Francisco (Oakland), Buenos Aires and Punta Cana. The new carrier, which will take to the skies in June, will fly two new Airbus A330 aircraft and will initially be operated by Iberia’s flight and cabin crew.

“LEVEL will become IAG’s fifth main airline brand alongside Aer Lingus, British Airways, Iberia and Vueling. It will complement our existing airline portfolio and further diversify our current customer base,” IAG’s chief executive Willie Walsh commented in the statement. “Barcelona is Vueling’s home base and this will allow customers to connect from Vueling’s extensive European network onto LEVEL’s long-haul flights.”

The launch comes after Walsh recently said that low-cost, long-haul flights will become ‘significant’ part of IAG’s operations going forward. Level meanwhile is expected to compete with Norwegian Air Shuttle and Wow Air which offer discount tickets for transatlantic routes.

City A.M. quoted Tim Clark, the president of long-haul giant Emirates, as commenting recently that the presence of the likes of Norwegian, Lufthansa and Air Asia was a ‘gathering storm’, with the low-cost carriers making inroads on the inter-continental routes around which it has built great success.

As of 13:51 GMT, Friday, 17 March, International Consolidated Airlines Grp share price is 573.00p.

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