ROUTES EUROPE: OAG doubts sustainability of European airlines

John Grant, EVP data & market intelligence, OAG, has told the Routes Europe Strategy Summit that he doubts that Europe can sustain the number of airlines currently operating across the continent (as defined by IATA’s geographic regions)

“The number of scheduled airlines now across the worrld is now 650, which is down from 781 in 2011 – that excludes ACMIs and US regionals operating as lift providers,” he noted, putting into context his reasoning. “In Europe there are still 168 airlines, with the UK having 19, yet China only has 29, which is up five from 2011. Can all those numbers in Europe be sustained? I’m not so sure,” he argued.

Examining the way the airlines are operating, Grant reported that the number of scheduled flights around Europe has remained the same as five years ago, but capacity has gone up with the use of larger aircraft. “Which means, of course, fewer emissions per passenger!” he observed.

Grant, like many others, foresees low-fare airlines as being the dominant force for intra-European flights by the end of decade. “They and the alliances will control the market,” he predicted.

Reporting on recent trends, Grant pointed to Turkey as the really big grower, with three of the top four city pairs operated in Europe being in Turkey (the other is London–Dublin). “Russia is a growing market too,” he added. “In fact, all bar one of top 10 fastest growing city pairs in Europe is connected with Russia or Turkey.”

Over the next five years, Grant predicts periods of airline consolidation. “Fuel prices won’t stay like today and certainly there will be some churn,” he remarked. For those who want to survive, “it’s all about relevance,” he commented.

Bernie Baldwin, editor, Low-Fare & Regional Airlines/
Aberdeen, UK

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