Etihad Airways will abandon its London Heathrow business and first class lounge as the airline continues to tighten its belt, with independent airport lounge chain No1 taking over the upscale space this month.

The UK-based company also runs pay-your-way-in lounges at Heathrow Terminal 3, Gatwick, Birmingham and Edinburgh.

Etihad's Heathrow T4 lounge will be rebranded as "The House – Home of Etihad Airways and Other Leading Airlines".

The airline says that other Etihad lounges around the world, beyond of its Abu Dhabi hub, could also be handed over to third-party operators, although a spokesman did not elaborate on the fate of Etihad's lounges at Sydney, Melbourne, Paris, New York and Los Angeles.

"Etihad Airways recently initiated a process of sourcing a reputable vendor to manage the airline’s lounge offering at key locations outside Abu Dhabi, starting with London Heathrow," the Etihad spokesman told Australian Business Traveller.

"No1 Lounges, a leading lounge services provider, was chosen as Etihad Airways' partner for this innovative project. With this partnership, Etihad Airways aims to utilise the proven expertise and experience of No1 Lounges to enhance the lounge experience for its customers, building on the acclaimed Etihad Premium Lounge offering, and providing even more choice and quality."

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The spokesman told Australian Business Traveller that Etihad's first class, business class and Etihad Guest Gold-grade passengers will have complimentary access to the No1 lounge, along with frequent flyers of partner airlines such as Virgin Australia's Velocity Gold and Platinum card-holders.

No1 is expected to continue to offer a buffet with limited à la carte menu, along with a tended bar. The lounge company was approached by Australian Business Traveller but declined to comment.

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However, Etihad has yet to advise if the elite Residence lounge-within-a-lounge will remain available to passengers booked in the Airbus A380's three-room penthouse above the clouds.

Although Etihad will be the No1 Lounge's primary client ahead of its own three daily flight – which run each morning, afternoon and evening – the lounge will admit passengers on any other airline departing T4, similar to arrangements at its Heathrow T3 lounge (which charges £32 per visit).

Etihad has previously closed the London lounge's Six Senses spa and allowed economy class passengers to pay their way into the lounge for £45 (A$80), while rolling out similar changes to its other lounges, axing inflight business class pyjamas and removing the complimentary chauffeur drive service for business and first class travellers.