Transport Commissioner's Office: Gloomy Outlook for European Aviation

3/29/2012 5:08 PM
Category: Economy

The Commissioner for Transport Siim Kallas's head of cabinet Henrik Hololei says European aviation must change, as it is no longer sustainable, with additional bankruptcies on the horizon.

Hololei said the "hub model" where major airports serve as trans-Atlantic staging areas operates at a loss.

This is the case, he said "especially with regard to big network airlines like Lufthansa, Air France, KLM. Airlines that use one or two central airports to bring passengers there from other places and fly them to more distant destinations."

Hololei said almost all such airlines make a loss with their regional flights and profitable long-distance flights cannot cover the shortfall.

He said the airlines that earn a profit are the ones that do not have the ambition to fly in passengers from different places and then fly them out of Europe.

But one way to improve the situation, according to Hololei, would be more active operations in Asia.

In remarks to Estonian journalists, Hololei said that Estonian Air's development in the last six months must be praised. "Finally a person has been found to lead the company who understands aviation, its needs and is prepared to take risks," he said speaking of CEO Tero Taskila.

He said although the model is similar to the loss-making airlines, it does not operate transcontinental routes and its cost base is not as high.

 

Kristopher Rikken


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