International Airlines Group (IAG) has announced it will launch a low-cost Austrian subsidiary, to be branded as Level, with flights starting from 17 July.

Level, which launched flights from Barcelona in 2017 and will soon commence routes from Paris, will have an Austrian Air Operator’s Certificate (IAG says it will establish flights to Barcelona, Malaga, Venice, Olbia, Ibiza, Paris Charles de Gaulle, Milan Malpensa, Dubrovnik, Larnaca, Alicante, Valencia and Bilbao.

The new subsidiary means IAG is set to take on other budget short-haul airlines within Europe, including Easyjet and Ryanair.

The news comes after IAG entered unsuccessful talks with Norwegian to buy out the low-cost carrier.

CEO Willie Walsh said in a letter to MPs in February that the UK’s Air Passenger Duty (APD) rates – which are the highest in Europe – were preventing Level from establishing low-cost flights to and from cities such as Birmingham, Cardiff, Edinburgh and Manchester because they were “not financially viable”.

Commenting on the new subsidiary, Walsh said: “We are launching this new short-haul subsidiary to provide Austrian customers with more flight choices across Europe. These flights will be branded as Level to build upon the huge success of our new long-haul low-cost operation.”

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