A number of commentators are missing that Spain ITTL would be aligned with the Soviet Union,
This is too deterministic.
Operation Felix wouldn't involve participation of Spanish troops, just Spain letting German troops pass through their territory. OTL the Franco regime let u-boats re-provision at Spanish ports, and even sent Spanish troops to fight alongside the Germans in Russia. Spain still remained "neutral". I think events ITTL increase the chances of Felix happening, while the Nazi-Soviet Pact is in effect.
This is super double-plus deterministic, in a very specific way. It presupposes not only that Spain is Stalinist, but that Stalin in Moscow directs his Stalinist Spanish proxies to allow their territory to be used as an avenue for a potentially decisive strategic German attack on Britain, something Stalin never allowed Soviet territory to be used for.
Certainly Stalinist Spain would trade with the Axis. But I’d say there’s a big difference between providing resources to the Axis and actively harbouring Axis troops. Some neutral countries allowed German troops to cross their territory it is true. Sweden, for instance, allowed the Wehrmacht to use northern railways to transport troops from Norway to Finland. But the Swedes only allowed the Germans to move troops from German occupied territory to a German allied nation. Not as a base for offensive operations. Very different to allowing the Wehrmacht to use your country as a base for a major military operation. Allowing the Germans to use Spanish territory to attack Gibraltar is Spain participating in a direct attack on the Western Allies. There’s no way TTL Operation Felix doesn’t lead to Spain getting drawn into the war so I think it’s highly unlikely the Spanish Republicans allow it.
Exactly.
If ITTL Spain follows Stalin on foreign policy, then they are actually aligned with Nazi Germany until June 1941. It would be possible for this government to be more favorable to Hitler than Franco was, for example they might let Hitler take Gibraltar.
"aligned with Nazi Germany" is an overstatement. The Stalinist foreign policy was closer, friendlier to Germany than to the west, and traded with German, but not aligned with it. The USSR still still traded with the UK and sought to avoid war with it, and would not encourage a Spain whose foreign policy it was directing to commit an act of war on Britain by hosting a Nazi invading force.
This changes with Barbarossa, but its safe to assume that Hitler, while crazy, isn't crazy enough to both invade Russia and start a war in Spain, so the Germans will quietly offer Spain neutrality, which will also be accepted.
But if Spain is such a Stalinist controlled satellite of the USSR, would Hitler let mere insanity and impracticality of the plan stop him from attacking Stalinist Spain and the USSR at the same time, and make the offer of neutrality? Would Hitler trust Stalinist Spain (a really Stalinist Spain or one he just suspects is) to keep any neutrality deal, or to stab him in the back? And, especially if really Stalinist, wouldn't Spain refuse the neutrality offer and fight the Nazis out of loyalty to Stalin? Within days of a Barbarossa start, the USSR would be cheering for Spanish fighting in the west, encouraging them to do anything, including joint attacks on the Nazis with British forces, to help put the Nazis under a second front.
I actually think that a Spanish Republic, unless it for some reason looks like it very much distanced itself from its Soviet benefactor after winning the Spanish Civil War, and the Nazi Germans of all people *believe* that, will cause a problem for the Germans in 1941 after the fall of France. Germany basically has to make any and all plans for attacking either Spain, or the USSR, plans to totally invade and crush *both* of them, starting exactly the same day, in order to maintain surprise, because he is likely to see them as inseparable allies.
I think if you want a Spanish theater in World War 2, the best and maybe the only way to do that is to figure out a way to have the Spanish Civil War still ongoing when France falls, assuming this doesn't butterfly away the Fall of France. In this case it will be too tempting to the Axis to trade active assistance for the Nationalists in return for a strike against Gibraltar, and in this case the Nationalists really need the help and won't decline. The British will try to get Axis forces bogged down in Spain as much as possible.
This is indeed the best way. Not the only west, but the best.