Asia flying high

Grounded: Europe's Aviation Industry

Lufthansa plane in frankfurt by Simone M Neumann
Frankfurt Airport operator Fraport is looking for jumbo passenger numbers.
  • Why it matters

    Why it matters

    Governments in the Middle East and Asia are heavily investing in aviation infrastructure to bolster trade just as European airports are finding it increasingly difficult to grow.

  • Facts

    Facts

    • Mega-airports, handling up to 160 million passengers a year, are being built in Dubai, Istanbul and Beijing.
    • Fraport, which runs Frankfurt airport in Germany, has lost out on bids to run Brazil’s main airports.
    • The number of air passengers in Europe rose by 5.4 percent in March, but the industry average was 7 percent.
  • Audio

    Audio

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More than three years after German airport operator Fraport failed in its bid to run two big airports in São Paulo and Brasilia, the company is reaching out again to South America.

Fraport – which owns and operates Frankfurt airport and several others around the world – plans to partner with the state-run airport operator Infraero to bring Brazil’s dilapidated airports up to date.

Meantime in London, the new CEO of Heathrow Airport, John Holland-Kaye, is sweating out what could be the end of a five-year dispute over expanding the British capital’s log-jammed airport. A recommendation is finally due at the end of this month – assuming the vote isn’t delayed again by yet another report on air pollution. Perhaps Mr. Holland-Kaye will then get the long-awaited approval to build a third runway for the world’s third-busiest airport.

The link between the two scenarios? Both highlight the fact that the European aviation industry is ailing, and desperately looking for ways to grow.

New mega-airports in Asia and the Middle East, freed of the political and economic restrictions facing European airports, are gaining the upper hand.

The reasons for Europe’s struggles, in part, are that established carriers such as Air France-KLM and Lufthansa are bringing problems on themselves. Management was much too slow coming to grips with excessive costs or, as in the case of Air Berlin, Germany’s second biggest airline, new acquisitions were not properly integrated.

The European aviation industry also suffers from lack of political support. Instead of understanding aviation as a service provider for other industries, governments continue to impose extra charges – such as Germany’s ticket tax, or obligations to buy “emission rights” to curb climate change – that other airline industries don’t face.

Getting approval for airport expansion in Europe these days is increasingly difficult.

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