British Airways’ parent company, International Consolidated Airlines Group (IAG), has announced a bold $23 billion investment in new long-haul aircraft, defying concerns over transatlantic travel demand and strengthening its position in the global aviation market.
The order, revealed on Friday, includes 32 Boeing 787-10 Dreamliners and 21 Airbus A330-900neos, with options for an additional 23 aircraft. While list prices suggest a combined value of more than $23 billion, industry norms around bulk-order discounts and the current delivery challenges at both Boeing and Airbus mean IAG is expected to pay significantly less.
The move comes alongside IAG’s release of its first-quarter 2025 trading results, which outpaced analyst expectations. Operating profits nearly tripled to €198 million—well above the forecasted €133 million—despite the traditionally sluggish winter period for northern hemisphere carriers. Group revenues rose nearly 10% to €7 billion, even as passenger volumes dipped slightly to 26.1 million, reflecting ongoing airfare inflation.
Shares in IAG were trading steadily at 290.6p following the announcement, having clawed back ground after tumbling earlier this year amid fears over economic fallout from US protectionist policies.
The €23 billion aircraft order is part of IAG’s strategy to boost transatlantic capacity, expand its Latin America-focused low-cost carrier Level, and phase out expensive leased planes. IAG currently operates a fleet of just over 600 aircraft across its five airlines: British Airways, Iberia, Aer Lingus, Vueling, and Level.
Despite recent warnings from rivals like Lufthansa and Air France-KLM over softening demand on US-Europe routes, IAG struck an optimistic tone.
“We are continuing to see good demand for air travel across our core markets,” the group said. “Latin America and Europe continue to be strong and the North Atlantic demand has been robust, with strength in our premium cabin mitigating some recent softness in US point-of-sale economy leisure.”
City analysts now expect IAG to reach an operating profit of €4.6 billion for the full year, up from €4.2 billion in 2024.
The aircraft order also highlights shifting dynamics in the aviation supply chain. While Rolls-Royce remains the sole engine supplier for the Airbus A330s in the deal, IAG has opted to equip its new Boeing 787s with General Electric engines, bypassing Rolls-Royce’s Trent 1000—a powerplant previously plagued by reliability issues.
With strong earnings, growing demand, and an aggressive fleet expansion plan, IAG appears to be charting a confident course through economic turbulence. The aircraft order cements its commitment to long-haul growth and operational efficiency well into the next decade.
