Global credit crunch is causing problem for consumers and businesses alike, and it appears that the air travel industry is not be able to avoid some trouble in the present scenario.

As the fuel prices continue to move upward and the US economy swaying on the threshold of a recession, the year ahead seems to be a bumpy ride for airline companies.

British Airways has asserted that the present economic situation is set to make the next few months very tough for many airlines.

Previously this week, Willie Walsh, Chief executive made his comments at an investor presentation in New York, saying that he believes this year will continue to be the year for mergers and bankruptcies.

He said, "There are many airlines out there that struggled when fuel was less than $100 a barrel which are not going to be able to take the required actions and we will see further failures".

Earlier this year, the air travel industry witnesses the folding of two airlines, MAXjet Airways and Eos Airlines, both were British Airways' rivals. However, BA has not reported a growth in transatlantic business since they collapsed.

Walsh further said, "The high oil price combined with the economic slowdown may well have made it an imperative for many [airlines] to consider consolidation. We will see meaningful consolidation, sooner rather than later".

During the last 5 months, a total of 7 airline companies have declared they bankrupt or stopped their operations.