Holding IAG’s Capital Markets Day marks a pivotal moment as the group lays out its strategic priorities for the coming years. Insiders report that the agenda includes a bold aim to raise 1.5 billion euros of operating profit, a target the company intends to reach in its medium-term plan. The disclosure came to light in a concise statement sent to the National Securities Market Commission, outlining how Spain will play a central role in this renewed growth trajectory. The emphasis is clear: the Spanish market, anchored by Iberia and Vueling, is expected to contribute a substantial portion of the group’s pre-pandemic profitability levels, with 2019 profit figures serving as a reference point for today’s projections.
During the first half of this year, the two Spain-based airlines posted operating profits that surpassed the equivalent period in 2019. Iberia, under the leadership of Fernando Candela, reported a substantial improvement, adding 255 million euros to reach a total of 372 million euros. The second quarter stood out as the strongest in Iberia’s history, with profits of 307 million euros. Vueling also delivered a solid performance, adding 91 million euros in the half-year to reach 96 million euros in total profit, underscoring the resilience of Spanish operations within the group.
While the timeline for hitting the 1.5 billion euro target remains to be clarified, the investor presentation underscored a clear medium-term framework for achieving the goal. A strategic expansion is also on the agenda through the acquisition of the Spanish airline Air Europa, a move designed to strengthen the group’s foothold in Latin America and enhance its overall competitive position across the region. This deal reflects a broader strategy to reinforce Spanish operations and integrate them more deeply with the group’s international portfolio, with Luis Gallego cited as a driving force behind the Air Europa initiative, having previously led Iberia during the 2020 execution phase.
Beyond Iberia and Vueling, the plan encompasses a robust investment program for the parent group, including a substantial allocation to British Airways. The latter is set to receive a significant funding envelope intended to sustain operational robustness and enhance customer offerings. Over a multi-year horizon, British Airways is earmarked to receive more than seven billion pounds in transformation initiatives between 2024 and 2026, with a focus on fleet modernization and service improvements that align with the broader strategic objectives of the group.
Two additional pillars support the revamped strategy: IAG Loyalty, the group’s loyalty program, and the ongoing company-wide transformation focused on operational efficiency and customer experience. IAG Loyalty is positioned to generate high margins and steady cash flow, with a profit profile that is less seasonal than that of the core airline operations. Meanwhile, the transformation program targets tangible gains in efficiency across the business, with a stronger emphasis on delivering a consistent, high-quality customer experience as a differentiator in a competitive market.
The leadership message emphasizes a broader expansion of the group’s footprint and leadership positions in key corridors. The plan calls for stronger operating bases in the North Atlantic and South Atlantic regions, with investments intended to unlock the full potential of the group’s regional hubs and to grow IAG Fidelity as a core asset within the corporate family. Executives stressed that the transformation and investment programs are designed to drive substantial change across all lines of business, creating efficiencies and delivering a superior customer experience that can sustain growth and profitability over the long term. The overarching aim, as stated by the group’s leadership, is to deliver durable value for shareholders through a combination of stronger market positions, enhanced product offerings, and disciplined financial management.