Spanair Closure Sees Vueling Stocks Soar
January 31st, 2012
The Spanish Stock Exchange believes that Vueling, the low cost airline owned by Iberia, will be one of the companies to benefit most from the closure of Spanair, after seeing them lead the markets with their stocks rising by over 20%.
Spanair had a market share in Barcelona, where they had their headquarters, of around 13%. All eyes are now pointing to Vueling, also based in Barcelona, to be the big beneficiary following the demise of its former rival, who announced the halt of their business at the weekend.
Cinco Dias reported that other potential winners in business, due to the cessation of Spanair could be Aer Lingus, which rose 7% on the Irish Stock Exchange, and Ryanair, which saw an increase of more than 1%.
Vueling, which is 49% owned by IAG, is the most likely candidate to gain a large number of the routes formerly operated by Spanair. Some of these have limited profitability, but others are of great value, such as the routes to the Scandinavian countries, industry sources explained.
“The most logical approach is that the remaining routes stay with the low-cost airlines, since they are the best able to promote them,” said one Spanish broker’s analyst. It is possible that the new Iberia Express may be interested in some of the routes, but these will be isolated cases, since the new IAG company will be focused on long haul routes.
Vueling announced yesterday that it will increase its seating capacity during the summer season by up to 25% over the capacity of the previous year, and by up to 50% in Barcelona airport. “With this new situation, Vueling will incorporate 33 extra flight frequencies on already scheduled flights, and five new routes; from Barcelona, Berlin and Hamburg, and from Bilbao, Tenerife, Las Palmas and Lanzarote in the Canary Islands,” the company said in a statement sent to the CNMV.
Related Posts
- Ryanair to Cease Tarragona Flights in October
- Iberia Approve New ‘Low Cost’ Airline
- Family Bankruptcies Soar 23.5% in Third Quarter
