On Friday, British Airways (IAG) (45% of 1H23 EBIT) and Unite (UK union) reached an agreement to increase pay by 13% in 2023 (~24,000 employees; excluding pilots). In addition, a one-off lump sum payment of £1,000 (~1,150 euros) was agreed. The agreement has already been approved by the union’s membership.
Assessment: Positive news insofar as the risk of strike action is mitigated in peak season (~40/50% of EBIT is generated in Q3), but which we do not expect to have market impact as it would be somewhat in line with expectations and also that there is still no agreement with the pilots (pilot strikes are usually the most damaging, although they are rare).
