The dynamics of European aviation are shifting. The International Airlines Group (IAG), which owns major brands like British Airways, Iberia, Aer Lingus, and Vueling, is in a strong position to acquire TAP Air Portugal, the national airline of Portugal. The Portuguese carrier serves as a crucial bridge between Europe and South America, with its connections to Brazil making it even more attractive.
A member of the Star Alliance, TAP has long been undergoing a privatisation process. But IAG is not the only contender in this race. Other major European airline groups, including Lufthansa Group, Air France-KLM, and Turkish Airlines, are also pursuing TAP. Notably, Lufthansa Group strengthened its position in Europe earlier this year by acquiring a 10% stake in airBaltic. Its acquisition of Italian carrier ITA Airways is also part of the group’s broader expansion strategy.
However, competition authorities may give IAG a competitive edge. A potential synergy between TAP and Iberia, which already operates in neighbouring Spain, strengthens IAG’s bid. The group currently owns a 20% stake in Air Europa and faced regulatory hurdles under EU antitrust laws while attempting to acquire the remaining shares. Acquiring TAP could further consolidate market control on the Iberian Peninsula.
TAP’s Star Alliance membership is also significant for Turkish Airlines. Strategically important for connectivity between Turkey and South America, TAP could play a critical role in THY’s transcontinental network expansion.
Meanwhile, the shift of SAS to ITA and Lufthansa’s investment in airBaltic have also changed the balance within the Star Alliance. In light of these developments, the group under which TAP will ultimately fall will have a direct impact on the future of the European aviation sector.
