If Easyjet closes its Madrid base, presumably this means Easyjet will no longer have any bases in Spain, while Ryanair has about 11 bases in Spain (even if some of them are pretty small) and Vueling has 6
Yes, Spain is going through a tough time economically. Yes, profitability and return on capital is more important than being macho with the most planes flying the longest routes. But this still indicates to me that Easyjet is signalling it's giving up on the core Spanish market (i.e. people living in Spain) and ceding the territory to Ryanair and Vueling.