British Airways CEO eyes India after Iberia merger

(News Today) - A newly merged British Airways and Iberia would be "very interested" in investing in an Indian airline, BA chief Willie Walsh said on Saturday as he announced a groundbreaking code-share deal with India's Kingfisher Airlines.

"Without question this is a market for the future," said Mr Walsh, who is set to head the new International Airlines Group company to be formed under the Iberia merger due to be finalised by the end of this year.

"The ambition of IAG is to pursue further opportunities for consolidation and I can certainly let you speculate that IAG would be very interested in participating in the Indian market," he told reporters in Mumbai on his second trip to the city in a month.

"It's too early for me to say for definite, given the new company hasn't yet gone into action, that would be early next year," he added. "But the ambition of the new company would be to pursue further consolidation and this is a very important market."

India lets international investors own stakes in its airlines, but not foreign carriers. There has been talk of changing the law however, as local carriers including Kingfisher and rival Jet Airways seek funds to expand in one of the world's fastest growing aviation markets.

British Airways, which counts India as its second biggest international market after the US, has been working on its relationship with the upscale Kingfisher for some time.

The UK flag-carrier sponsored Kingfisher's recent move to join the Oneworld global alliance and on Saturday, Mr Walsh revealed the two airlines had agreed to a code-share deal -- BA's first with an Indian airline.

The new agreement, due to start on September 15, will give each carrier more access into each other's local markets, allowing passengers to fly far more seamlessly on a range of new routes, such as London-Mumbai-Goa or, heading the other way, Mumbai-London-Paris.

Instead of having to book separate tickets on each airline, one ticket will be available on each carrier's website; luggage will be checked all the way through; frequent flyer miles used for the full trip and each airline will offer access to its lounges.

The move should help ward off the growing threat both BA and Indian airlines face from fast-growing Middle East airlines such as Emirates of Dubai and Etihad of Abu Dhabi, which have been expanding their presence throughout India in recent years, especially in its secondary cities.

Emirates is seen as a particular threat, especially since it announced in June it was ordering 32 more Airbus A380's, the world's largest passenger jet, on top of the 58 it had already said it would buy.

The move has led some to wonder if the ambitious airline could end up transforming the long haul aviation market as much as successful budget carriers such as Dublin-based Ryanair have revolutionised short distance markets.

Mr Walsh is well aware of the challenge in India, one of the world's fastest growing aviation markets.

"I think Emirates will be looking with envy at us today as we announce our new relationship with Kingfisher," he said.

Source : CNN

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