Air Europa and Iberia end aircraft dispute

Airline Industry Information, March 22, 2002

AIRLINE INDUSTRY INFORMATION-(C)1997-2002 M2 COMMUNICATIONS LTD

Air Europa and Spanish airline Iberia have settled their dispute concerning the return of rented aircraft.

In October 2001, Iberia announced its plans to reduce capacity by 11% and cut costs in a bid to offset a decline in business in the wake of the 11 September terrorist attacks. As one of the measures, the airline decided to return six aircraft and their crews, which were leased from Air Europa. In response Air Europa filed a lawsuit seeking USD69m in compensation over the early return of the aircraft, which were on lease until 2004.

The two airlines have reportedly reached an agreement which they claim is satisfactory for both sides, but declined to release any details, reported Reuters.

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