The aviation landscape will be "unrecognisable" in 20 years time, IAG boss Willie Walsh has predicted, as he highlighted the growing need for airline consolidation.
Walsh told delegates at the World Travel and Tourism Council Global Summit in Abu Dhabi that alliances are a "poor subsitution for proper consolidation",
“We have to accept that if you didn't have restrictions on ownership or control, you would be seeing more consolidation," he said.
"But we are an industry that’s always changing; five years from now you will see a very different industry, and 20 years form now it will be unrecognisable.”
According to Walsh, consolidation is driving change for the better in the US where five carriers control 84-85% of capacity.
“It’s about profitability now. The industry is not sustainable unless airlines are making profits to be able to afford investment," he said.
"The industry has got to return its cost of capital and we are now seeing a realisation among industry leaders in the US, that this is the primary objective."
But Etihad boss James Hogan underlined the importance of partnerships in terms of bilateral value, and in order to achieve a lower cost base and scale.
“How we partner is certainly changing and the ability to build a stronger proposition is fundamental," he added..