British Airways (BA; 52% of IAG 2024 BS(e) capacity) is readjusting its long-haul capacity schedule in the face of delays in the delivery of Rolls-Royce engines and parts, particularly the Trent 1000 engines installed in B-787s. They do not expect the problem to be solved in the short term.
In any case, the company has said it can offer the vast majority of those affected a same-day flight with British Airways or one of its partner airlines.
Assessment: On the one hand, the news is negative, insofar as it offers fewer frequencies/routes, although the impact could be limited as it will offer an alternative to affected passengers. On the other hand, the fact that the supply of seats in the market will continue to be influenced by the various engine/aircraft supplier problems (not only BA is affected) will continue to put upward pressure on prices, which we view positively. That said, we expect that in the 3Q’24 Results (to be published) we will see an upward pressure on prices. 3Q’24 (to be published on November 8) management will be able to provide more information in this regard.
