Aviación y Comercio, S.A., was a Spanish airline incorporated on February 18, 1948. It was founded when the National Institute of Industry proposed that the national carrier of Spain, Iberia, could not meet the domestic demand. This had been caused by the heavy commitment of Iberia to the lucrative South American market, especially Buenos Aires and Montevideo. However, the company faced increasingly intense competition from Air France, KLM and British South American Airways, which compromised its own domestic growth. Aviaco won the tender that permitted services on domestic routes that Iberia did not operate.
The first aircraft were three freighters Bristol 170 and three Bristol 170 for passengers. Operations began in September 1948 between Bilbao and Madrid.
By 1965, a joint Aviaco-Iberia board was set up to coordinate aviation policies, which ensured that Aviaco and Iberia routes did not compete with each other.
During the 1980s, most of Aviaco shares were acquired by its competitor Iberia. From that time, Aviaco ran the less important domestic routes while Iberia served the international destinations and the most important national routes, such as the shuttle service Madrid-Barcelona. All the Aviaco technical, marketing and financial resources were transferred to Iberia. During this time, Aviaco had a fleet of Douglas DC-9 planes, which were painted in blue and white livery.
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