1 00:00:00,200 --> 00:00:03,080 Speaker 1: It is rare that you can say a person, a 2 00:00:03,240 --> 00:00:07,400 Speaker 1: CEO turned around an airplane. If you're out of JFK 3 00:00:08,160 --> 00:00:12,400 Speaker 1: or anywhere across America. There is Iberia. It is of 4 00:00:12,440 --> 00:00:16,360 Speaker 1: Spain and Luis Gaiago I hope I'm pronouncing that correctly, 5 00:00:16,400 --> 00:00:19,279 Speaker 1: probably butchering it, but he did it. He did what 6 00:00:19,400 --> 00:00:22,759 Speaker 1: we wish they would do in America, turn around an airline. 7 00:00:22,840 --> 00:00:28,560 Speaker 1: In conversation with our guy Johnson IAG CEO British Airways, 8 00:00:28,680 --> 00:00:32,199 Speaker 1: is his fault? Guy, take please help us here at 9 00:00:32,200 --> 00:00:37,879 Speaker 1: your aviation festival with a gentleman of Iberia. 10 00:00:38,920 --> 00:00:42,280 Speaker 2: We're in Lisbon, Tom, Yeah. Luis Gegel is the CEO 11 00:00:42,360 --> 00:00:45,880 Speaker 2: of IAG, IAG, the holding group for as you say, Iberia, 12 00:00:46,360 --> 00:00:48,240 Speaker 2: British Airways, air Lingers. 13 00:00:48,280 --> 00:00:49,400 Speaker 3: So this goes on and on. 14 00:00:49,640 --> 00:00:51,760 Speaker 2: It's one of the big three holding groups in Europe 15 00:00:51,840 --> 00:00:56,200 Speaker 2: that owns the vast majority of Europe's airlines. You guys 16 00:00:56,240 --> 00:00:58,000 Speaker 2: were just talking about what's happening with the dollar. The 17 00:00:58,000 --> 00:00:59,760 Speaker 2: other thing that's kind of floating around this industry at 18 00:00:59,760 --> 00:01:03,200 Speaker 2: the moment is what is happening with fuel. Fuel prices 19 00:01:03,280 --> 00:01:07,360 Speaker 2: absolutely rocketing higher. You've got Brent obviously surging, but the 20 00:01:07,400 --> 00:01:09,280 Speaker 2: crack spread on top of that to make jet fuel 21 00:01:09,560 --> 00:01:11,760 Speaker 2: also super wide at the moment, which means jet fuel 22 00:01:12,080 --> 00:01:13,000 Speaker 2: is very expensive. 23 00:01:13,040 --> 00:01:13,320 Speaker 3: Leaf. 24 00:01:13,560 --> 00:01:16,440 Speaker 2: Great to see you. Thanks for stopping by to see us. 25 00:01:17,080 --> 00:01:20,279 Speaker 2: Does higher oil? Does higher jet fuel mean higher fares? 26 00:01:22,720 --> 00:01:26,280 Speaker 4: Fuel for US is twenty five percent around of a 27 00:01:26,360 --> 00:01:29,880 Speaker 4: total cost, but in AAU with half thirteen policy, so 28 00:01:30,000 --> 00:01:35,160 Speaker 4: forvir with above seventy percent of the fuel cover and 29 00:01:35,160 --> 00:01:37,240 Speaker 4: there's the areas around forty percent now. 30 00:01:37,760 --> 00:01:40,080 Speaker 3: So at the end, the first are related. 31 00:01:39,720 --> 00:01:42,160 Speaker 4: To their supply and their demand and the co medician 32 00:01:42,200 --> 00:01:43,759 Speaker 4: that we're have in our different market. 33 00:01:43,840 --> 00:01:47,559 Speaker 2: Okay, competition is really important. The American carriers don't hetge, 34 00:01:48,000 --> 00:01:51,760 Speaker 2: so you're hedged your American carriers. The competitors on the 35 00:01:51,760 --> 00:01:54,640 Speaker 2: North Atlantic are not hedged. Do you have an advantage 36 00:01:54,960 --> 00:01:57,600 Speaker 2: right now because of the higher fuel price on the 37 00:01:57,600 --> 00:02:02,040 Speaker 2: North Atlantic versus those American competitors in North Atlantic? 38 00:02:02,680 --> 00:02:05,400 Speaker 4: You know, we have a joint business with American airlines 39 00:02:05,440 --> 00:02:08,880 Speaker 4: within air Redious Airways and Iberia and at the end, 40 00:02:08,880 --> 00:02:12,560 Speaker 4: we have a profit pull of revenues that we share 41 00:02:12,639 --> 00:02:13,840 Speaker 4: between the different airlines. 42 00:02:13,880 --> 00:02:15,639 Speaker 3: So we have metal centrality. 43 00:02:15,720 --> 00:02:19,520 Speaker 4: The customer they can fly in the airline that the 44 00:02:19,680 --> 00:02:22,720 Speaker 4: day two so at the end, all the benefits we share. 45 00:02:23,440 --> 00:02:26,200 Speaker 2: But nevertheless, versus the other groups outside of your group, 46 00:02:26,240 --> 00:02:28,919 Speaker 2: do you think you have if they're not edged, are 47 00:02:28,919 --> 00:02:29,800 Speaker 2: you making more money? 48 00:02:29,880 --> 00:02:30,960 Speaker 3: Right now? On the North Atlantic? 49 00:02:31,120 --> 00:02:34,240 Speaker 4: I think in really in the States, don't heads in 50 00:02:34,320 --> 00:02:35,800 Speaker 4: Europe with heads, So. 51 00:02:35,639 --> 00:02:39,200 Speaker 2: At the end we are one. Okay, okays itself? How 52 00:02:39,320 --> 00:02:41,959 Speaker 2: is demanded on? What do you saying at the moment, 53 00:02:41,960 --> 00:02:44,079 Speaker 2: I'm hearing the banks on spending big. At the moment 54 00:02:44,200 --> 00:02:46,760 Speaker 2: I'm hearing the big chech is not spending big. What's 55 00:02:46,760 --> 00:02:49,440 Speaker 2: happening with demand, what's in particular is happening with business demanding. 56 00:02:49,960 --> 00:02:55,360 Speaker 4: So the man is very very strong, particularly lesser demand premium. 57 00:02:55,440 --> 00:03:01,480 Speaker 4: Lesser traffic is amazing. The The corporate traffic is the 58 00:03:01,520 --> 00:03:05,360 Speaker 4: one that is lagging behind. We are still, for example 59 00:03:05,400 --> 00:03:08,760 Speaker 4: in levels in BA in the second quarter of around 60 00:03:08,880 --> 00:03:12,680 Speaker 4: sixty percent in volume, seventy percent in revenues of what 61 00:03:12,720 --> 00:03:13,880 Speaker 4: we had in twenty nineteen. 62 00:03:13,919 --> 00:03:17,400 Speaker 3: In the case of Iberia is better it. 63 00:03:17,680 --> 00:03:20,960 Speaker 4: Was around eighty percent in volume ninety percent in revenue. 64 00:03:21,360 --> 00:03:24,600 Speaker 4: The main reason is they operate in different markets. But 65 00:03:24,639 --> 00:03:28,040 Speaker 4: also I think in Spain the people after COVID they 66 00:03:28,080 --> 00:03:33,200 Speaker 4: came back to play office before that, what is happening 67 00:03:33,200 --> 00:03:33,880 Speaker 4: in UK? 68 00:03:34,600 --> 00:03:37,320 Speaker 2: You and I have just been on a panel with 69 00:03:37,680 --> 00:03:41,240 Speaker 2: Luis Rodriaz, He's the guy that runs TAP. It's gonna 70 00:03:41,280 --> 00:03:44,440 Speaker 2: be a cabinet minutes meeting tomorrow that's gonna determine kind 71 00:03:44,480 --> 00:03:47,880 Speaker 2: of what happens next in the privatization of the Portuguese 72 00:03:47,920 --> 00:03:51,720 Speaker 2: flag carrier. Have you have you had a little conversation 73 00:03:51,800 --> 00:03:56,240 Speaker 2: with him. You've expressed interest in maybe bringing TAP into 74 00:03:56,240 --> 00:04:00,760 Speaker 2: the IAG group. Do you think that's why the right call? 75 00:04:00,840 --> 00:04:03,560 Speaker 2: Why are you the right potential owner for CIP. 76 00:04:04,360 --> 00:04:07,000 Speaker 4: First of all, we want to see what are going 77 00:04:07,040 --> 00:04:11,320 Speaker 4: to be the conditions of the privatization. But we are 78 00:04:11,600 --> 00:04:15,640 Speaker 4: a group that was created in order to consolidate the sector, 79 00:04:15,920 --> 00:04:20,919 Speaker 4: and we have excellent brands, excellent airlines below us. So 80 00:04:23,000 --> 00:04:26,320 Speaker 4: I think is an operation that could be interesting for us, 81 00:04:26,400 --> 00:04:28,360 Speaker 4: and I think the model that we have is the 82 00:04:28,440 --> 00:04:32,719 Speaker 4: right one for a company of the size of TP. 83 00:04:32,920 --> 00:04:33,479 Speaker 3: They can have the. 84 00:04:33,480 --> 00:04:36,919 Speaker 4: Advantage to belong to a group like us, but to 85 00:04:37,040 --> 00:04:41,640 Speaker 4: have the freedom to preserve the brand, to preserve the customer, 86 00:04:42,040 --> 00:04:44,520 Speaker 4: to be accountable of the P and L. So I 87 00:04:44,560 --> 00:04:47,400 Speaker 4: think what we have shown in the past is that 88 00:04:47,560 --> 00:04:50,320 Speaker 4: all the airlines joining the group, they have developed much 89 00:04:50,320 --> 00:04:51,040 Speaker 4: more than. 90 00:04:51,040 --> 00:04:52,280 Speaker 3: When they were alone. 91 00:04:54,040 --> 00:04:57,760 Speaker 2: Do you think you can own Iberia, a Europa and 92 00:04:57,920 --> 00:04:58,320 Speaker 2: c AP. 93 00:04:59,400 --> 00:05:04,440 Speaker 4: Yes, yes, are here because I think Ibinia need ROPA. 94 00:05:04,480 --> 00:05:05,919 Speaker 4: We are in the middle of the process with the 95 00:05:05,960 --> 00:05:10,240 Speaker 4: competition authorities. This system operation of consolidation in the hub 96 00:05:10,320 --> 00:05:13,679 Speaker 4: of marine. But DAP when you look at the market 97 00:05:13,880 --> 00:05:18,160 Speaker 4: DP is operating mainly is Brazil that we don't have 98 00:05:18,400 --> 00:05:23,600 Speaker 4: a lot of presence there and also former colonies of Portugal. 99 00:05:24,680 --> 00:05:27,960 Speaker 4: So I think the networks are very complementary and that's 100 00:05:28,000 --> 00:05:29,320 Speaker 4: the reason we can operate. 101 00:05:29,400 --> 00:05:30,839 Speaker 3: For example, we do. 102 00:05:30,960 --> 00:05:33,400 Speaker 4: I have a strategy in the same way we have 103 00:05:33,560 --> 00:05:35,120 Speaker 4: a doubling a London in an North. 104 00:05:35,920 --> 00:05:38,119 Speaker 2: Can I just talk to you about what the future 105 00:05:38,120 --> 00:05:41,359 Speaker 2: of this industry looks like. It is flying going to 106 00:05:41,360 --> 00:05:46,200 Speaker 2: become too expensive because of the journey the aviation has 107 00:05:46,240 --> 00:05:49,760 Speaker 2: to go on to get itself to common neutrality. We 108 00:05:49,880 --> 00:05:52,520 Speaker 2: talk about self sustainable aviation fuel. It is going to 109 00:05:52,560 --> 00:05:55,920 Speaker 2: be which jet feels expensive, the same aviation fuel is. 110 00:05:55,839 --> 00:05:57,320 Speaker 3: Going to be epically expensive. 111 00:05:57,880 --> 00:05:59,080 Speaker 2: Do you think people are going to be able to 112 00:05:59,120 --> 00:06:02,200 Speaker 2: afford to fly when we make this journey? When your 113 00:06:02,240 --> 00:06:05,040 Speaker 2: aircraft are powered by sustainable aviation field. It's going to 114 00:06:05,080 --> 00:06:06,200 Speaker 2: be too expensive. 115 00:06:05,800 --> 00:06:08,520 Speaker 4: For all but the very early I think it's going 116 00:06:08,560 --> 00:06:12,600 Speaker 4: to be more expensive. The question marriage if it's going 117 00:06:12,600 --> 00:06:14,679 Speaker 4: to have an impact in the in the demand. 118 00:06:16,440 --> 00:06:17,400 Speaker 3: We think that. 119 00:06:19,000 --> 00:06:23,080 Speaker 4: We can the carbonized aviation, but maintaining a first that 120 00:06:23,279 --> 00:06:26,200 Speaker 4: can be affordable for the for the consumers, and we 121 00:06:26,320 --> 00:06:28,400 Speaker 4: have a lot of people that they say we are 122 00:06:28,400 --> 00:06:32,120 Speaker 4: really to pay a little more in order to fly 123 00:06:32,279 --> 00:06:35,880 Speaker 4: in a sustainable way. So I think that's the challenge. 124 00:06:36,720 --> 00:06:39,280 Speaker 4: But we don't have any other alternative. We need to 125 00:06:39,279 --> 00:06:40,200 Speaker 4: the carbonize aviation. 126 00:06:40,360 --> 00:06:42,719 Speaker 2: The British government is already starting to back off some 127 00:06:42,760 --> 00:06:44,320 Speaker 2: of its sustainability targets. 128 00:06:44,640 --> 00:06:45,440 Speaker 3: Do you think you could. 129 00:06:45,320 --> 00:06:49,040 Speaker 2: See aviation maybe big set looser targets. Do you see 130 00:06:49,040 --> 00:06:50,440 Speaker 2: that coming? Do you think it's a mistake to the 131 00:06:50,480 --> 00:06:52,800 Speaker 2: British government is backing off its targets. 132 00:06:53,000 --> 00:06:55,520 Speaker 4: I think we need to maintain their mission because otherwise 133 00:06:56,240 --> 00:06:59,680 Speaker 4: we are not going to achieve the commitments to have 134 00:06:59,800 --> 00:07:03,839 Speaker 4: net zero missions by by twenty fifty. The main issue 135 00:07:03,880 --> 00:07:07,359 Speaker 4: is that we don't have staff enough to comply with 136 00:07:07,400 --> 00:07:11,640 Speaker 4: the mandates that they are putting in place. So it 137 00:07:11,680 --> 00:07:13,840 Speaker 4: doesn't matter if we put a mandate if you cannot 138 00:07:13,840 --> 00:07:16,800 Speaker 4: buy saff or itself, so what we need is production 139 00:07:16,920 --> 00:07:19,920 Speaker 4: of saff. It doesn't make sense that International Airlines Group 140 00:07:19,960 --> 00:07:22,920 Speaker 4: we are buying SAFF from US to put in our 141 00:07:23,040 --> 00:07:25,680 Speaker 4: aircraft in Europe. It doesn't make sense and we need 142 00:07:25,720 --> 00:07:26,200 Speaker 4: to fix that. 143 00:07:26,840 --> 00:07:27,240 Speaker 3: Who's great. 144 00:07:27,280 --> 00:07:29,440 Speaker 2: See I thank very much, dive stock, but see, thank 145 00:07:29,440 --> 00:07:29,960 Speaker 2: you very much. 146 00:07:30,200 --> 00:07:32,080 Speaker 3: Think of I AG There you go. 147 00:07:32,280 --> 00:07:35,760 Speaker 2: John Flank's gonna get more expensive, Okay, Johnson, not the 148 00:07:35,840 --> 00:07:36,560 Speaker 2: kind of news we want.