Madrid Airport seeks to extend its hub capability to link Asia to North America and Latin America markets

10 May, 2018

Local reports suggest that the Spanish airport operator AENA plans to establish Adolfo Suárez Madrid-Barajas Airport as a hub to connect Asia to Latin America and to North America's east coast. Spanish flag carrier Iberia is reported to be an ally of such aspiration, with similar goals.


  • Madrid Barajas is far and away Europe's leading hub airport to and from Latin America;
  • Now operator AENA is reported to desire to increase that hub capability to connect Asia and North America, too, supported by national carrier Iberia;
  • Analysis shows seat capacity between Madrid and Asia in particular is weak compared to other European hubs;
  • Madrid is quite strong on alliances and oneworld airlines are co-located in the airport's T4S; that might ultimately be the way forward if more oneworld carriers can be attracted.

Iberia is part of IAG, along with British Airways, which would like to do the same via London, while Lufthansa, Air France and KLM all have the same windmill to tilt at via their own European hubs making this a highly competitive market. But the real 'enemies' in all their cases are to be found in the Middle East, which has the airport and airline capacity to do it rather more easily and a growing propensity in the case of Emirates at least to do so by way of exercising fifth and sixth freedom traffic rights, which puts it at an advantage over the European carriers.

Barajas Airport is already an intercontinental hub of course; it has been a leading connector between Europe and Latin America for many years. Back in Aug-2017 The Blue Swan Daily reported that the chief executive of Globalia, Javier Hidalgo, had stated a desire to "create a great hub in Madrid, like Dubai", so that "Latin American passengers can stay two or three days before proceeding to travel on into Europe".

In that same report an analysis was made of the comparable capacity to and from Latin America at Europe's leading gateway airports and the result is updated for this year. There are no other airports in Europe with Madrid's credentials as a gateway to and from Latin America. Close to 20% of available seats are to and from destinations across Upper and Lower South America, Central America or the Caribbean. The closest competitor amongst Europe's main hubs was Paris Charles de Gaulle, with almost 5%.

CHART - Madrid has a much higher number of seats between Europe and Latin America than any other major European airportSource: The Blue Swan Daily and OAG

When one compares that result with capacity at the same airports to and from North America and Asia (combining north, south, southeast and central Asia), the picture is entirely different and places Madrid at a much weaker position than its rivals, and the Asia total also doesn't also take into account the huge flows of passengers that are flying into the region via the Middle East hubs.

CHART - Madrid has a much weaker position to the other major European airports in terms of capacity between Europe and North America (top) and Asia (bottom) Source: The Blue Swan Daily and OAG

With only 2% of seats from Barajas currently linked to Asia, securing Asia-Latin America passenger flows would be a challenge and a deliver only a tiny amount of traffic. Similarly, it is hard to see how a justification could be made for attacking an Asian-North America market just now.

Part of this inadequacy is explained by Iberia's route network. The concentration of routes into Europe and Central/South America is evident, at the expense of Asia. But one should not blame Iberia. Its strengths outside Europe lie in Latin America and it is slowly rebuilding its network there having had to cancel or severely limit some critical routes there five years ago during a severe Spanish recession. Iberia knows on which side its bread is buttered.

MAP - Iberia's long haul route network has a heavy bias to the west and in particular into Latin America and the CaribbeanSource: CAPA - Centre for Aviation and OAG

Iberia is not the only hubbing airline in Spain of course. Air Europa set out its stall to challenge Iberia in some of its markets and almost 40% of its seats are on services to South and Central America and the Caribbean. However, it similarly has few seats to and from Asia.

One saving grace for Madrid Barajas is that it is fairly strong on alliances, with only a quarter of departure seats on unaligned carriers and with oneworld holding the dominant market position.

CHART - Almost half of flight capacity (47.2%) from Madrid Barajas is flown on oneworld carriers, ahead of SkyTeam (19.8%) and Star (7.2), with unaligned operators, mainly LCCs holding a 25.7% shareSource: CAPA - Centre for Aviation and OAG

Apart from Iberia and BA, other oneworld members include Cathay Pacific, Japan Airlines, Malaysia Airways and SriLankan Airlines, from both North and Southeast Asia; also Qantas and from the Middle East, Qatar Airways, while Russia's representative is S7 Airlines. So there are at least the bones of an alliance-led impetus that could be tempted to help fulfil AENA's reported objectives if all these airlines can be tempted into operating at Barajas (not all do).

It also helps when airlines are terminal-allocated by alliance. That is not always the case at airports across the world, but actually is at Barajas, at least in the case of oneworld, with all of the eight member airlines operating at that airport based in Terminal 4S.

In our opinion, AENA has a hard sell here. It is one thing to aspire to being a global hub, another to convince the airlines that do the hubbing that you have a viable proposition. Judging from the seat capacity allocation outlined above and tentatively from what airline parent companies might think about it, AENA might be better advised to focus on what it is good at and keep a focus on the Europe-Latin America market.