British Airways will be ready to buy or merge with other airlines around the world from next year, Willie Walsh said on Thursday.
One of the aims of the deal with Spain’s Iberia that BA plans to complete by the end of this year is to create a combined group capable of “scaling the business by either merging with other airlines or acquiring other airlines”, the airline’s chief executive told an industry meeting in London.
“The ambition is truly global,” he said of the merged group, to be known as International Airlines Group. “The intention is to be in a position to avail of opportunities if they present themselves, certainly within the first year of operation.”
BA executives have spoken of such ambitions for IAG before, but Mr Walsh, who is to become IAG chief executive if the merger goes ahead, is the first to suggest new deals could be done as early as next year.
No specific airlines have been targetted he said, but he has previously spoken of reviving talks BA had with Qantas of Australia in 2008 that were subsequently ditched after the two sides failed to agree terms.
“IAG is not putting BA and Iberia together; IAG is creating a platform that can compete on a global scale,” he said, adding he was “delighted that is the common objective that both the BA team and the Iberia team have”.
Under the terms of the proposed merger, BA and Iberia would still operate as separate airlines with their own brands, but the strategy of the combined group would be set by IAG.
Separately, Mr Walsh urged the UK to abolish its air passenger duty once European airlines are brought into the European emissions trading scheme from January 1, 2012, arguing aviation “cannot be expected to pay its environmental costs several times over”.
And he repeated his warning that BA would grow in future at Madrid rather than Heathrow if the UK failed to build the infrastructure needed to cope with rising demand for air transport.
“We can compete effectively for a few years, maybe 10 years but 20 years from now, the UK is going to be bypassed becuase we won’t have the infrastructure to support the demand that exists,” he warned.
“The government needs to be awake to that. I’m not sure that’s been recognised yet,” he said, noting the rising competitive threat posed by governments in regions such as the Middle East now rapidly expanding their national airline fleets and airport capacity.
“We’ve got to make sure we treat these ambitious carriers with respect and I can assure you that’s exactly what we’re doing at BA,” he said.
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