London, 15 Jan 2026, 09:30 GMT — Regular session
- IAG shares climbed roughly 0.5% in early London trading, reversing part of a five-day losing streak.
- Vueling unveiled a €5 billion strategy focused on switching to a Boeing 737 MAX fleet, aiming to boost passenger numbers through 2035.
- Broker notes this week diverged, spotlighting demand and delivery risks for 2026.
Shares of International Consolidated Airlines Group edged higher by around 0.5% to roughly 406.5 pence at 0930 GMT, rebounding slightly after a near 7% drop over the last five sessions. 1
This move is crucial as investors look to gauge how much cash the British Airways owner will require to refresh its fleet while pushing growth in short-haul leisure markets. Changes in delivery timelines or costs tend to hit airline valuations fast.
With IAG’s next earnings report on the horizon, attention will turn to how management addresses capital expenditure, capacity strategies, and its outlook on transatlantic demand following a turbulent start to the year.
Vueling, IAG’s low-cost carrier based in Barcelona, revealed its “Rumbo 2035” plan on Wednesday. The airline will invest €5 billion and switch from an all-Airbus fleet to Boeing 737 MAX jets. Vueling targets 60 million annual passengers by 2035, up from roughly 40 million now. The first 737 MAX is set to arrive in October 2026, followed by two more before the year ends. The full fleet transition should take seven to eight years. Carolina Martinoli emphasized the core focus remains Barcelona, domestic Spain, and European connectivity. 2
Davy upgraded IAG to “outperform,” setting a price target of 525 pence, according to an Alliance News summary. Barclays, however, maintained its “Equal Weight” rating with a 425 pence target. Analyst Andrew Lobbenberg noted that optimism around network airlines had become “too large” lately, sticking instead to a preference for low-cost carriers and travel companies. 3
Lobbenberg highlighted broader challenges for Europe’s main airlines in a separate note this week, pointing to risks in the North Atlantic market such as a softer U.S. dollar and geopolitical tensions. The firm also cautioned that premium leisure demand might fall short of airlines’ expectations. 4
Vueling’s strategy leaves IAG caught in a fierce European short-haul battle. Ryanair and easyJet have already taken the lead on cost efficiency, while limited aircraft availability continues to restrain growth despite strong demand.
The downside is clear: costs can spiral if fleet deliveries fall behind schedule, or if training and maintenance expenses climb. Add in airport capacity issues and labour deal delays clashing with growth targets. And if travel demand weakens, justifying that extra spend gets tough.
