Virgin Atlantic voices concerns about IAG/Aer Lingus tie-up

Virgin Atlantic (VS, London Heathrow) is planning to take its concerns about the International Airlines Group's (IAG) proposed takeover of Aer Lingus (EI, Dublin International) to the European Commission (EC), a week after it did so with an Irish parliamentary Transport Committee.

During its meeting in Dublin last week, Virgin sought commitments to preserve competition in the Ireland-United Kingdom market which, if the sale goes ahead, would see Aer Lingus and fellow IAG sister carrier British Airways (BA, London Heathrow) cornering over half the market - Dublin International-London Heathrow in particular where the IAG would hold a monopoly on all nineteen of the route's daily flights. As such, Virgin wants legally binding commitments from IAG on the total number of Aer Lingus and British Airways flights from Ireland to the UK.

“IAG has made some public offers of commitments on Aer Lingus frequencies, but importantly it’s made no promises about BA services, leaving it free to reduce BA frequencies after the transaction,” Joe Thompson, Virgin Atlantic director of network and alliances, was quoted by the Irish Independent. “Any commitment should be extended to cover British Airways as well as Aer Lingus, so the current level of frequencies is maintained.”

Virgin Atlantic will also push to ensure that in the event of a sale, Aer Lingus upholds its interline agreements with Virgin Atlantic wherein the Irish carrier feeds traffic into Virgin's British hubs for onward flights to international destinations such as the Caribbean and Hong Kong.

“If IAG’s proposed acquisition of Aer Lingus is allowed to progress unchecked, this choice is at risk. IAG will have a monopoly on flights between Ireland and the UK that enable the vast majority of these connections. And it will be able to withdraw from interline agreements with airlines that provide it with competition for connecting passengers,” Thompson added.

Summing up, Thomson said that overall any deal between the IAG and Aer Lingus would be detrimental to competition and therefore to consumers as a whole.