Business travel slump hits long haul network
Iberia has blamed a sharp drop in long haul traffic in May on the continuing decline in demand for business travel.
Last month Iberia's long haul routes suffered a 13.7% decline in traffic year-on-year. Overall, system-wide traffic fell 11.4%.
"Traffic is still very weak, particularly in the business segment, due to the impact of the economic crisis," the airline said.
Iberia cut capacity 9.6% across its network in an attempt to boost the number of seats filled. But overall load factor fell 1.6% despite growth on European and domestic routes of 3% and 0.2% respectively.
Iberia said there was still "high pressure" on European yields, despite balancing a 6.7% fall in traffic with a 10.3% cut in capacity.
Last week Iberia warned it could suffer its first annual loss in over a decade (see ABTN news June 3).
Important business routes between Madrid, London and Latin America have been badly hit as the economic downturn forces business travellers to look for cheaper air fares.
Iberia recently announced "severe" cost cutting measures amounting to €200m in savings, including cuts in capacity and staff pay (see ABTN news May 12).
www.iberia.com