Airline wars

Low-Cost Boom Hurting Airport Owner Fraport

  • Why it matters

    Why it matters

    Budget airlines are growing much faster than traditional airlines, forcing major hubs such as Frankfurt to woo them by offering discounts.

  • Facts

    Facts

    • Ryanair has encroached on Lufthansa’s home turf by starting flights from Frankfurt, Germany’s main hub.
    • Frankfurt airport operator Fraport offered discounts to lure Ryanair because it wants to tap into the booming budget airline market.
    • The price of a budget airline ticket fell to between €40 and €70 by last fall from between €50 and €130 in early 2015, according to calculations by the DLR German Aerospace Center.
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    Audio

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Startendes Flugzeug
Fraport has upset Lufthansa by offering lower take-off and landing fees. Source: DPA

Michael O’Leary, the flamboyant head of Irish budget airline Ryanair, has a crazy-sounding vision. “One day I want all the air fares on Ryanair to be free,” he told Handelsblatt in January. He’d make money from additional travel services such as catering, hotels or auto rentals instead.

That may be music to passengers’ ears but it highlights a threat to traditional airlines and big airports like Frankfurt, consultants and analysts warn.

Budget European carriers including Ryanair, Wizz Air and Lufthansa subsidiary Eurowings have launched an all-out assault on the German market this year by aggressively adding routes, forcing even the big airports to grant them more slots. And these are being offered on more favorable terms than those given to the established carriers like Lufthansa.

They’re doing so to halt an exodus of passengers to smaller airports that offer more budget flights, said Stefan Schulte, the head of Frankfurt airport operator Fraport.

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