IAG is holding talks with both Boeing and Airbus on future fleet requirements for its long-haul budget carrier Level.

The airline has been built around the Airbus A330-200, and its fleet is expanding to five aircraft – three for its Barcelona base and two for its new station at Paris Orly.

IAG chief Willie Walsh says the short-term fleet-development plan for level is to reach some 15 aircraft.

While IAG has not detailed Level's full-year financial performance, Walsh says unit costs are "better than expected" at the carrier and that the A330-200 operation is a "very efficient" structure.

He says that, even at fuel prices of $650 per tonne, the fuel-efficiency cost of the Boieng 787 is "not enough" to offset the ownership cost, compared with the A330.

But he points out that IAG has access to 787s and the "flexibility to use them". The population of 787s is increasing, he says, and more 787 pilots are available.

He says the 787 is maturing and, as ownership costs decline, the type offers "more and more" opportunity, adding: "In five years' time, is the A330-200 the right aircraft?"

Walsh says that IAG is "in discussions" with Boeing, as well as Airbus, over Level's future fleet.

Level's summer network has been rejigged, with the Punta Cana route appearing to have been dropped in favour of new services to Boston, Montreal, Guadeloupe and Martinique.

Walsh stresses that IAG has not seen any evidence of "cannibalisation" of Iberia since Level emerged. "Level has exceeded expectations," he says, adding that it offers a "lot of opportunity" for IAG, giving it a "significant advantage over competitors".

Source: Cirium Dashboard