IAG Has Finally Agreed to Buy Air Europa

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International Airlines Group – the parent company of British Airways, Iberia, Vueling and Aer Lingus – has finally concluded a deal to buy 100% of Spanish airline Air Europa.

This deal was first announced before the pandemic, although there was substantial political pushback, given the near monopoly it would give IAG of the Spanish domestic market. Iberia, Vueling and Air Europa make up 70-75% of all domestic flights in Spain…

But with Air Europa not far from collapse – IAG already purchased 20% of Air Europa’s shares in 2022 via a quasi-bailout structured as a convertible loan – it looks likely that the deal will be waved through.

Air Europa Will Continue Operating as a Separate Brand

Air Europa will keep its existing branding, but it will be managed by Iberia. This won’t be terribly relevant for British readers, since Air Europa’s only UK destination is London Gatwick (a mere 2 flights per day).

But some British travellers were potentially connecting through Madrid to South America. The lack of competition will probably be felt most there, since Air Europa was often the only major competitor to Iberia on many routes. (of course if Air Europa collapsed, that competition would disappear anyhow)  For Spanish domestic flights, I suspect that Ryanair will pounce on any market opportunities should IAG jack up their fares…

What About the Loyalty Programme Angle?

Air Europa is a member of Skyteam – the alliance led by Delta, Air France, etc. (and soon Virgin Atlantic) If the deal completes, Air Europa will exit Skyteam. (although it may not necessarily join Oneworld)

Air Europa’s loyalty program is called SUMA. SUMA will adopt Avios as its loyalty currency, but may or may not be fully merged into Iberia Plus.

As a member of SkyTeam, you can currently credit miles from any SkyTeam flight to Air Europa SUMA – Delta, Air France, KLM, Aeromexico, Korean Air, Saudia etc.  If you aren’t a big fan of Flying Blue or the other Skyteam frequent flyer programmes, you can always credit any upcoming Skyteam flights to SUMA and wait until these are converted to Avios.

As a little added bonus, SUMA offers new members 787 free miles when signing up for SUMA and taking their first flight. (I believe the flight must be on Air Europa itself)


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