BA boss expects airline consolidation to speed up

The British Airways chief executive said on Monday that he expects there to be more consolidation among airlines in the near future, but that his airline intends to be very selective in the operators they team up with.

In remarks made to analysts at a conference in New York, Willie Walsh, the CEO of British Airways, predicted that more airlines will weaken in the coming months as financial conditions worsen around the world. He said that BA would not invest in companies that had become so weakened that they might place the carrier’s finances at risk.

“Any consolidations that we pursue will serve to strengthen us,” Walsh noted. “And in this climate, that means a lot of acquisitions go by.”

On Friday, when it released its half-year results, BA said that it was considering a relationship with the Italian investment consortium, CAI, which is attempting to rescue the bankrupt Italian carrier, Alitalia. Walsh indicated that the airline would not seek an equity stake in the reorganized carrier, however. Talks are also ongoing with the Spanish carrier Iberia.

At the conference BA’s CEO said that the airline is taking a conservative approach overall, as it expects that global economic conditions are likely to worsen before they finally improve.

“We’re still heading into the eye of the storm — we’re not yet coming out the other end,” he added.

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