The Strategist

European Airlines Are Up in Arms at European Airports

01/21/2016 - 14:28

Leading European airlines, such as Lufthansa, Air France-KLM, British Airways, Iberia, Easyjet and Ryanair, have declared an alliance to fight against the increasing airport charges.

Piergiuliano Chesi
Piergiuliano Chesi
The airlines believe that constantly increasing European airports’ taxes are reducing competitiveness of European air carriers. The carriers intend to attain ends by negotiations with the EU authorities, governments of European countries, airports’ managers and international organizations.

The new alliance is called Airlines for Europe (A4E). In a joint statement, heads of the airline alliance’s members said: "We need to action now - the industry is characterized by presence of large monopolies that own airports, high fees and lack of efficiency and expediency in the tax system. Together with the European Commission and the EU authorities, we want to develop a strategy that would help to solve these problems."

According to a recent study by Aviation Economics, fees in 21 major European airport rose by 80% since 2005. During the same period, an average European company lowered the prices of 20%. In addition to the fight against monopolies, airlines offer lower costs for the control of European airspace. For this purpose, the companies propose to speed up implementation of the Single European Sky agreement, aimed to transfer air movement management functions in the airspace of EU countries from the national authorities to a single pan-European. The agreement was made in the late 1990s, yet commissioning and integration national authorities into work are still ongoing. Partly, the delay is caused by issues in taxation on the part of some EU countries. In particular the Italian authorities have recently decided to raise tax on each passenger, served in the Italian airports, to € 2,5 starting from 2016. Airlines believe that introduction of new and growth of existing taxes only harms competitiveness of the European aviation industry. As a positive example, they cite 2009, when the Government of the Netherlands abolished air ticket tax, which led to an increase in passenger traffic in the country.