International Airlines Consolidated Group S.A. (LSE: IAG) , the owner of British Airways and Iberia, is cutting short-haul capacity by 2.4% in 2026 while rivals Ryanair, Lufthansa Group and easyJet all add seats, UBS data shows.
IAG supplies 9.9% of long-haul capacity in UBS's sample, second only to Air France-KLM (OTC:AFLYY) at 11.4%, but is growing it by just 0.4%.
Spain makes up 39% of IAG's 2026 capacity, up from 36% in 2025, while the UK share falls to 23% from 25% and Middle East exposure is 1%.
UBS wants capacity cuts rather than growth as jet kerosene prices have risen by more than 130% this year, after reaching a peak increase of over 160%.
European airlines' capacity growth in the fourth quarter of 2026 is moderating to 2.2% on long-haul routes and 0.3% on short-haul, from previous estimates of 2.5% and 0.4%.
Seat capacity from the Middle East to Europe is down 9.4% in October, 12.7% in November and 8.4% in December.
Wizz Air, the Hungarian low-cost carrier , is the outlier, with short-haul capacity growth of 26.6% in 2026, while Ryanair, the largest provider, grows 1.8%.
