Iberia (Spanish pronunciation: [iˈβeɾja]), legally incorporated as Iberia Líneas Aéreas de España, S.A. Operadora, Sociedad Unipersonal, is the flag carrier of Spain. Founded in 1927 and based in Madrid, it operates an international network of services from its main base of Madrid–Barajas Airport.
Iberia, with Iberia Regional (operated by an independent carrier Air Nostrum) and with Iberia Express, is a part of International Airlines Group. In addition to transporting passengers and freight, Iberia Group carries out related activities, such as aircraft maintenance, handling in airports, IT systems and in-flight catering. Iberia Group airlines fly to over 109 destinations in 39 countries, and a further 90 destinations through code-sharing agreements with other airlines.
On 8 April 2010, it was confirmed that British Airways and Iberia had signed an agreement to merge, making the combined operation the third largest commercial airline in the world by revenue. Shareholders of both carriers approved the deal on 29 November 2010. The newly merged company, known as International Airlines Group (IAG), was established in January 2011, although both airlines continue to operate under their respective brands.
Iberia, Compañía Aérea de Transportes, was incorporated on 28 June 1927 with a capital investment of 1.1 million pesetas by financier Horacio Echevarrieta and Deutsche Luft Hansa. Flight operations commenced on 14 December 1927. The Spanish government contracted the company to provide postal transport between Madrid and Barcelona. During Miguel Primo de Rivera's dictatorship, Spanish aviation companies were amalgamated and became state-controlled as a general interest public utility, starting early 1928. Consequently, Iberia was merged into CLASSA (Compañía de Líneas Aéreas Subvencionadas S.A.), ceasing independent operations on 29 May 1929. Although the airline had neither a fleet nor commercial operations under its brand, the name 'Iberia' remained registered.
In 1937, during the Spanish Civil War, Spanish navy captain and director-general of the company Daniel de Araoz y Aréjula received the order from General Alfredo Kindelán to organize an airline for the air transport in nationalist-held territory during the war. Daniel de Araoz y Aréjula traveled to Germany to get support and material for the restoration of the company as an independent airline, thus six Junkers Ju 52 from Deutsche Luft Hansa arrived, which were acquired by Iberia at the end of the conflict, in addition to material to help the operations. As the name "Iberia" was still registered, it was used when operations began in 1937 towards the end of the war. During the conflict Iberia was a purely domestic airline, with headquarters in Salamanca the airline operated flights to cities in the nationalist side, Spanish North Africa, Spanish West Africa and Morocco. After the war, at the end of the 1930s, the airline served the Seville–Larache–Cape Juby–Las Palmas, Barcelona–Zaragoza–Burgos–Salamanca–Seville–Tetuan and La Palma–Barcelona–Vitoria runs using Junkers Ju 52 aircraft. On 1 May 1939, Iberia operated its first regular service to an international destination as an independent civil airline with a Madrid–Lisbon flight.
In 1940, the government gave the monopoly of national air transport to Iberia (this fact changed 6 years later when the government liberalised the national air traffic for the private airlines), This privilege helped the company to start building as an important international airline, which had not been until then. The airline was nationalised on 30 September 1944 and became part of Instituto Nacional de Industria. The policy of the company was to separate itself from the German orbit to which it had been linked in its first years and establish relations with the United States in terms of aircraft purchase and supplies of aeronautical material for the operation. Thus, that year the purchase of seven DC-3 and three DC-4 was finalised, to expand the network in Europe and accomplish the company's first transatlantic flight. This was achieved in 1946, Iberia was the first airline to fly between Europe and South America after World War II, using a Douglas DC-4 to operate flights between Madrid and Buenos Aires. This flight was the first of an expansion of flights between Latin America and Europe through Spain carried out by the company, with destinations such as San Juan de Puerto Rico, Caracas, Ciudad de México and La Habana. The poor diplomatic relations of the Francoist regime delayed the establishment of some destinations until the beginning of the 1950s.
Iberia incorporated four more DC-4s into its fleet during the first half of 1950, enabling both the strengthening of current services and the launch of new ones. With the Pact of Madrid in 1953, visa requirements were eliminated for US visitors to Spain. This stimulated the start of transatlantic flights between Spain and the United States the following year. The airline phased in the first of three Super Constellations in June 1954. The aircraft was named Santa María to commemorate Columbus' first voyage and was deployed in the inauguration of the new Madrid–New York service two months later, on 3 August 1954, the same day that Columbus left the port of Palos de la Frontera. The amendments to Article 6 of the Convention on International Civil Aviation of 14 June 1954 made in Paris on 30 June 1956 about non-scheduled air services enabled mass tourism using chartered aircraft since allowing European member states to carry out this type of operation with international flights between their territories. This favoured the airline given that it had in its territory several highly sought after destinations, mainly those on the eastern and southern Mediterranean coast and in the Balearic and Canary Islands, highly demanded by seaside tourism which began with this type of operation.
In 1959, the Spanish airline Aviaco became a part of Iberia by controlling two-thirds of its capital in a capital increase. Aviaco had been created in 1948, after the national air traffic had been liberalised for Spanish private companies in 1946.
In 1961, Iberia had 9 Super Constellations in the fleet, that year came into service the first DC-8-50, the four-engined jet airliner was progressively incorporated until reaching the number of 8 aircraft of the 50 series variant. Iberia was gradually incorporating jets of short and middle range, such as Sud Aviation Caravelle, and Douglas DC-9. The Super Constellations were removed and sold in 1966, and two years later, three DC-8-63 with more seat capacity were incorporated into the fleet. By 1969, the long-range fleet of Iberia was composed of 11 DC-8s. In the early 1970s, the jumbo jets Boeing 747s and Douglas DC-10s came to the company during an expansion of the intercontinental routes, especially to Central America. By the middle of this decade, the airline flew to almost all Latin American capitals. With the expansion in Latin America the company had followed a policy of purchasing shares and establishing agreements with several Latin American airlines such as Compañia Dominicana de Aviación, Aérolíneas Peruanas, PLUNA and Air Panamá Internacional. At first, the intention of this policy could be to create a strong distribution network for intercontinental routes passengers, but as the airline was controlled by the state the Franco regime used this investment policy to get support in Latin America. Iberia gave material, capital and logistical support to those flag-carrier airlines. By 1971, these investments resulted in the loss of 14 million dollars. Iberia also bought the short-middle range trijet Boeing 727-200 in 1971, of which the company had 35 aircraft and was used until 2001 like the other short-range jet bought by the company in the late '60s, the Douglas DC-9.
In 1987, Iberia, together with Lufthansa, Air France and SAS Group, founded Amadeus, an IT company (also known as a Global Distribution System) that would enable travel agencies to sell the founders and other airlines' products from a single system. In the same year, Iberia planned a fleet renewal in the middle-range fleet with the McDonnell Douglas MD-87 and Airbus A320 replacing the Douglas DC-9 and Boeing 727 respectively. In June 1990, the carrier bought 16 Boeing 757s for US$1 billion, including spares and training; twelve more aircraft of the type were taken on option as a part of the deal.