UPDATE 1-Iberia unions plan strike after failed job talks

Thu Jan 31, 2013 11:47am EST

* Iberia offers 30 percent fewer job cuts, other concessions

* Unions say fresh offer is still far from its demands

* Airline had set a Jan. 31 deadline for union support

MADRID, Jan 31 (Reuters) - Workers at Spanish airline Iberia said they would strike after rejecting a fresh proposal by management on job and salary cuts hours before a deadline for agreement.

Iberia, part of the International Airlines Group, and unions were in talks over the loss-making airline's plans to axe up to 4,500 jobs and cut salaries in what it has called a "fight for survival".

In a revised proposal, Iberia said it offered 3,147 job cuts, 30 percent fewer than in the original plan, lower wage reductions and capacity cuts of 10 percent for this year rather than an initial plan for 15 percent.

The six unions that represent Iberia's ground and cabin crews rejected the plan in a joint statement on Thursday, calling it far from the terms that had been agreed during weeks of talks with management.

The unions did not say when they would go on strike.

The airline had set a Jan. 31 deadline to reach a restructuring deal with the unions and has threatened unilateral cuts if unions failed to support the plan.

Iberia posted a 262 million euro operating loss in the nine months to September and analysts say it has little choice but to address structural costs to stop bleeding cash.

Iberia's domestic and European business has suffered from rising competition from low-cost airlines and high-speed trains, as well as falling consumer demand in its recession-hit home market of Spain, where one in four workers is unemployed.

Unions recognise a tough operating environment but disagree with the airline's plans so far to revive its business.

At the root of discontent has been Iberia's low-cost carrier Iberia Express, meant to compete with budget rivals like Ryanair Holdings Plc and EasyJet Plc.

Iberia has suffered periodic strikes since it announced the creation of Iberia Express and has estimated about 1 million euros of losses for every day that its crew walks off the job.