IAG, the owner of BA and Iberia, is poised to cancel its acquisition of Spanish airline Air Europa after regulators raised competition concerns over the E500m deal. With the travel outlook darkening, IAG said it was in advanced discussions to terminate the agreed purchase with Spanish tourism conglomerate Globalia. In response, the Spanish government said it regarded Air Europa as a “strategic company for Spain due to its importance for the aviation and tourism sectors”. Madrid added that it had “made its intentions clear from the outset [of the pandemic] by lending its support” for the carrier. So far the Spanish state has made more than E600m in aid available to Air Europa. IAG’s CE Luis Gallego admitted last month he had become “less optimistic” the deal would happen after EU and UK regulators announced antitrust inquiries. The company initially agreed to pay E1b for the airline, which runs domestic and international flights including to the Americas, in a deal originally signed in late 2019 before the pandemic. It was reduced to E500m in January, with payments deferred for six years, after the pandemic hit IAG hard as it ran up billions of euros of losses. The proposed tie-up was the final act in IAG’s decade of expansion under former chief executive Willie Walsh, and would have strengthened its position in the market for transatlantic flights to South America, and helped turn Madrid airport into a significant European hub. But the proposed agreement raised concerns from the EU Commission and the UK’s Competition and Markets Authority. European officials feared the potential loss of competition and the negative effect on rivals on a number of long- and short-haul routes.<br/>
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Qantas Airways said on Thursday it expects domestic competition to intensify in the second half of the financial year as state borders open, after forecasting a first-half loss due to months of lockdowns. The airline forecast a first-half underlying loss before interest and tax of more than A$1.1b. Domestic booking demand slowed in late November when the Omicron coronavirus variant emerged but there had been a recent improvement, the airline said. Qantas will focus next year on generating cash rather than posting a bottom-line profit as it begins to recover from pandemic-related border closures, CE Alan Joyce said. “For us 2022 is not about making money,” he said. “It is about getting people back to work, generating positive cashflow and repairing the balance sheet.” Qantas said it boosted its liquidity position during the half through the A$802 million sale of land near Sydney Airport. It expected to have A$5.6 billion of net debt as of Dec 31, the end of the first half of its financial year, lower than its June 30 debt position of A$5.9 billion.<br/>Joyce said the emergence of the Omicron variant in late November led to an initial pause in international bookings and a slowdown in domestic bookings but that had started to recover. “We have confidence the market recovery is fundamentally on track,” he said. Australia’s domestic airline industry, held back during the pandemic by state border closings, is gearing up for a price war as new entrants in the jet market challenge Qantas and its biggest rival, Virgin Australia.<br/>
Airbus clean swept a multi-billion dollar aircraft deal with Qantas in a blow to Boeing and its 737 Max narrow-body jet. The Australian carrier said Thursday it plans to buy Airbus’s A320neo line of aircraft to replace the 75 aging Boeing 737s that serve as Qantas’s domestic workhorses. It will also purchase Airbus A220 planes to replace 20 Boeing 717s that ply regional routes inside Australia.<br/>Airbus SE clean swept a multi-billion dollar aircraft deal with Qantas Airways Ltd. in a blow to Boeing Co. and its 737 Max narrow-body jet. The Australian carrier said Thursday it plans to buy Airbus’s A320neo line of aircraft to replace the 75 aging Boeing 737s that serve as Qantas’s domestic workhorses. It will also purchase Airbus A220 planes to replace 20 Boeing 717s that ply regional routes inside Australia.<br/>