'We're Preparing For Spain's Euro Exit': BA, Iberia Parent Readies For Currency Collapse

Spain's Iberia has created a euro zone crisis management group to deliver a "Spain euro exit road map project" to prepare for a possible exit by the indebted country, with the group meeting every two weeks.

The frank admission comes as it emerged IAG was preparing a whole restructuring of the Iberia, which made an operating loss of €263 million ($322 million) in the first half of 2012.

"Iberia's problems are deep and structural and the economic environment reinforces the need for permanent structural change," IAG chief Willie Walsh said, according to Reuters.

"The plan should be completed by the end of September and will encompass every aspect of Iberia's business."

Unlike its partner BA, which made a €13 million profit in the first quarter, Iberia has suffered from soaring fuel costs and less spending on air travel owing to the ongoing euro zone debt crisis.

It's been a tale of two airlines and two cities with BA and London doing well and Iberia and Madrid struggling," Davy analyst Stephen Furlong told Reuters.

"Iberia has been hit by tough economic conditions in Spain, it has a high cost base and labor costs, Spanish airport charges have risen and it is struggling to compete with low-cost airlines."

Shares in IAG have fallen 10 percent in the last three months, and were down 4.3 percent in early morning trading.