Iberia's decision to sub-lease aircraft and hand certain short-haul routes to Vueling was something the carrier "needed to do" as an interim measure while it presses its pilots for an agreement that will decide the future of its short-haul business model.

"We were forced by the situation of the short- and medium-haul operation, which for Iberia is an operation that is not competitive," says an Iberia spokesman.

Several options are on the table, including establishing a new short-haul airline and contracting out short-haul flying to third parties under similar agreements to the one signed with Vueling, says the spokesman.

He adds that there are also a couple of other options, which are not being disclosed.

Under the deal with Vueling, Iberia will sub-lease six Airbus A320s to the low-cost carrier for a period of eight months and hand over a number of routes that it can no longer operate profitably.

Iberia also plans to hand over several undisclosed additional short-haul routes to regional franchise partner Air Nostrum, also for a period of eight months, says the spokesman.

"We needed to do something as soon as possible so we signed these agreements with Vueling and Air Nostrum," he says, adding that Iberia had to take steps now "to solve the problem of not being competitive" on short-haul routes.

In the meantime, the carrier will continue to thrash out the options with its pilots in the hope of reaching consensus "as soon as possible" on the course its future short-haul business model will take. Iberia is hoping a decision will be reached before the end of the eight-month agreements with Vueling and Air Nostrum.

"Only two things are clear at this stage: Vueling and Air Nostrum are taking some routes, and we are talking to pilots to get an agreement on a new model for short- and medium-haul to make it more competitive," says the spokesman.

Source: Air Transport Intelligence news