Op-ed: The unsustainable "Spainair model"

Spainair, an airline headquartered in Barcelona, relies on subsidies from the Catalonian government to operate. Until the crisis hit and ticket sales declined, Spanair fomented low-cost airlines and went under yesterday because the Catolonian government pulled its aid. Having arrived at this point, the airline could only survive if it were sold to Qatar Airways.

Yesterday the EU denied Spanair's request for aid from the Catalonian government, and the Qataris are showing how using public funds to subsidize an unsustainable company threatens competition, something that the Arabs do not want to happen.

Therefore, talks failed and the Catalonian government announced that it would stop providing aid to Spainair just when the industry is re-organizing. Iberia has to create a low-cost option and merge. Barajas is trying to find a way to operate in an international airport. The Spanair model was trying to charge traditional costs and still compete with low-cost routes and wrote off attempts to operate intercontinental flights from Prat and fly as a government-funded airline.

Yesterday Spainair suspended all flights. This is a lesson for the culture of subsidies, which maintains costs at unsustainable levels and absorbs taxpayer funds that could be employed more strategically and efficiently.