Spanish airline Iberia launched a new low-cost carrier for Europe whose first flight takes off on March 25, against a backdrop of angry protests by workers who fear for their salaries.
"This is a fundamental project for the Iberia group," chief executive Rafael Sanchez-Lozano told a news conference officially unveiling the new carrier, Iberia Express.
"It will allow short- and medium-haul operations that are currently not profitable to become profitable, to make the group grow," he said, referring to the International Airlines Group, formed by the merger of Iberia and British Airways in 2011.
"It is an absolutely necessary element of the group's strategy," he said.
The first Iberia Express flight will run on March 25 from Madrid to the eastern coastal city of Alicante.
Iberia pilots and other staff have staged several days of strikes in protest at the launch of the new offshoot.
Unions complain that lower salaries are being offered to new recruits on the budget airline and fear that jobs will be shifted away from Iberia.
Management says the conditions of existing staff will not be affected.
The government has appointed a mediator to handle negotiations between pilots and the management.
A few dozen protesters demonstrated outside Iberia's headquarters during Friday's news conference, waving banners that read: "Iberia Express will destroy 6,000 jobs."
Iberia Express will start on 17 routes, serving destinations including Ibiza and Majorca in Spain and further afield: Dublin, Naples and Amsterdam.
It plans to expand by the end of 2012 to serve more than 20 destinations, with 14 aircraft and 500 staff carrying 2.5 million passengers this year, the company said.
The carrier aims to turn a profit from this year and to save IAG some $130 million a year from 2015 by replacing regular Iberia flights on those routes with Iberia Express services.
Copyright Agence France-Presse, 2012