Emirates-Etihad merger rumours - Is there room for consolidation in the Middle East?

International premium demand plummeted in the Middle East in Sep-08, while IATA predicts combined Middle East airline profits of just USD200 million this year. Taking out Emirates’ strong contribution most of the region’s 30+ carriers are likely to incur deep losses this year. So is consolidation the next step for the Middle East as a response to the sharp slowdown in global and regional economies? There have also been reports growing financial pressures in the UAE could even prompt a merger between powerhouse airlines Emirates and Etihad, to create an Air France-KLM style force in global aviation.

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