Unions representing pilots at British Airways and Spain's Iberia support a proposed merger to create the world's third-largest airline, they said on Wednesday.

The Spanish pilots union, SEPLA, and the British Airline Pilots Association (BALPA) estimate the merger will generate GBP323 million pounds (USD$567 million) in combined savings and revenue growth in 2010, rising to GBP615 million in 2014.

The unions said it would give the combined company greater scale to compete with European rivals Air France-KLM and Lufthansa.

"A merger between the two companies will bring benefits to both and, without doubt, to the workers. It is essential to face the challenges of our industry," Justo Peral, president of SEPLA told a joint news conference with his British counterpart in Madrid.

Peral said Spanish pilots would not lose their jobs as a result of the merger.

"Iberia is 100 pilots short and we have gone five years without hiring," he said.

Under the planned merger BA and Iberia will continue to operate as separate carriers but benefit from shared muscle in buying aircraft and fuel. Gains would also come from route rationalisation, as well as an expansion in the number of flights and destinations key to attracting business passengers.

Jim McAuslan, secretary general of BALPA said the unions are worried that the global financial crisis could sink the merger.

"What is important is to say "go ahead"," McAuslan told journalists. BALPA represents all but 200 of the 3,500 British Airways pilots while SEPLA speaks for 1,800 Iberia pilots.

Iberia and British Airways bosses have so far refused to outline possible job losses, but BA chief executive Willie Walsh said in an interview on Monday the most evident synergies were in IT and supplies.

Walsh also told Spanish newspaper El Mundo the merger would take more time than expected. His chairman Martin Broughton said last month the deal should be finalised next March.