Europe’s airline industry is consolidating
Image source: The Economist
America may be the land of free-market competition. But look up at the sky and Europe looks freer. The European Union is home to 135 scheduled airlines; America has 59. The five biggest carriers in America control around 70% of the market; the eu’s top five barely hold half. Concentration has resulted in poorer service: three American operators can be found on the list of the world’s 50 best carriers, as rated by Skytrax, an aviation website, compared with 13 European ones. As predictably, it has benefited shareholders, who earn three times as much for every frazzled passenger as those in Europe (see chart). Signs of American-style consolidation will therefore please Europe’s capitalists as much as they worry competition authorities—and flyers.
European skies have grown less crowded of late. The number of airlines in Europe has fallen from a peak of 180 in 2003. Since the start of 2018 at least 14 have collapsed. In March wow, an Icelandic low-cost carrier, entered bankruptcy. The previous month Flybmi and Germania went bust, following vlm of Belgium, Primera Air, based in Latvia, Cobalt Air of Cyprus, Germany’s Azur Air, Lithuania’s Small Planet Airlines and a Swiss carrier, SkyWork. Flybe, Europe’s largest regional airline, is barely hanging on.
Source: The Economist
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