Spanish airline Iberia has cancelled 266 of its flights because of a strike by pilots fearing job losses when company planes are diverted for use by Iberia's new budget carrier.

Concerning the Basque airport of Loiu, six flights between Madrid and Bilbao will be cancelled on Monday, the first day of a two-day strike called by pilots union SEPLA protesting the creation of Iberia's subsidiary company Iberia Express, scheduled to open in March 2012.

Another one-day strike is planned for Wednesday 11th, when four more flights will be cancelled. .

Iberia, Lineas Aereas de Espana, S.A., plans to divert jetliners from money-losing domestic and medium-haul European routes for Iberia Express, which it hopes to launch next year using lower-earning, newly hired pilots and flight attendants. The company says its plans are for this carrier to have 40 planes in 2015.

Pilots union SEPLA fears job losses with the creation of this unit designed to compete with budget airlines.