AerRyan,
Is it your contention that IAG took over AerLingus this would only be in order to curb its expansion in order to bolster London Heathrow loads with pax coming from the UK regions?
IAG in my view want to make a significant investment, they will want that to grow and be fruitful, EI need the TA feed to make make many of the Dublin UK and Europe routes work, and in the face of FR competition on these routes the transfer pax are needed. Eg Dub GLA, NCL, BHX etc. IAG will see the strategic advantage that long term the Dublin operation can offer. Let's not also ignore the commerciality of the EI business, especially transatlantic, their margins are very good comparatively speaking.
I'm not at all convinced that Iberia to the UK regions is a good comparison. Iberia has been traditionally high cost and not competitive, like BA flying to the regions has been left largely to LOCO carriers, exit stage BA from the regions largely and Iberia is not cut out for such routes, hence Vueling vehicle, besides this market is crowded. Aer Lingus on the other hand is capable of successfully competing with Ryanair. IB has totally and traditionally failed to link spain ( outside of mad and BCN) with international destinations. BCN has limited operation now too . Hence BA centre on successful London routes, Iberia successful Madrid routes and Aer Lingus successful Dublin routes. Hub and spoke. The rest will be left to Vueling and to lesser extent IB express.