Plus a third for European flights
Why air travel in Germany has become so expensive
08/22/2023, 2:46 p.m
Consumers had to dig deep into their pockets for air travel this summer. This is not going to change any time soon because the causes are still there.
Flying in Germany is much more expensive than before after the Corona crisis has been overcome. In the first half of 2023, the Federal Statistical Office registered a price increase of 25 percent for international flights, and European flights, which are particularly interesting for tourists, cost 32 percent more than a year earlier. The expensive summer vacation season is almost over, but there are no signs of relaxation in the travel market for the autumn vacation either.
The Lufthansa subsidiary Eurowings is reporting 30 percent more bookings than at the same time last year, asking 443 euros for a one-way flight to Malaga in Spain at the start of the autumn holidays in Hamburg, for example. Condor even charges 499 euros for the same route. “Flying has to have its price and cannot be as crazy cheap as other companies have tried to suggest,” says Eurowings boss Jens Bischof.
Fees are increasing everywhere
Of course, there are also cheaper fares on other days, but the (promotional) ticket prices of 9.99 euros that Bischof scolded cannot come back mathematically. In the meantime, a majority of German airports have reached the upper limit of 10 euros set by the state for passenger and hand luggage checks alone. In addition, there are air traffic taxes for each individual passenger (12.73 euros for a European flight) as well as fees for the airport and air traffic control before an airline can do even one cent of its own business.
The German fee structure for air traffic is “completely dysfunctional and uncompetitive,” says Ryanair manager Eddie Wilson. The Irish warn urgently against further increases in fees, which would further seal off the German market and demand maximum prices from German customers. However, even in countries like Italy, under a market leader Ryanair, ticket prices have gone through the roof this year.
Good reasons for more expensive tickets
Expert Gerald Wissel from the consulting firm Airborne sees objective reasons for price increases. With inflation, the costs for many necessary things have increased immensely. “It starts with the staff, continues with scarce spare parts and maintenance services and does not end with increased purchase prices for on-board catering.” In addition, airports and air traffic control have increased their fees. “German air traffic control has the special legal problem that it basically has to work to cover its costs. One is now trying to recoup the losses from the Corona period by significantly increasing fees. This is by no means the case in all European countries.”
Those responsible are apparently almost embarrassed by the high income. The head of the state-owned Deutsche Flugsicherung (DFS), Arndt Schoenemann, sees considerable problems for the air traffic location due to the high fee burden, which is losing with a shortage of connections to the whole world. Actually against the interests of his company, the DSF boss has therefore proposed to his owner Bund that the airlines be relieved of the currently excessive fees for pilotage services. Wissel agrees: “Of course the state has to step in here. That’s a clear competitive disadvantage for the location.”
Airlines drive prices automatically
The airlines are still earning very well this summer and are heading for billions in profits. With their booking systems, they drive the prices up automatically, reports consultant Wissel. “It was clear from the start that demand would significantly exceed supply this summer. As a result, tickets were rarely sold at the lowest prices in the lowest booking classes.”
The most important reason for the high prices remains the unfavorable supply-demand ratio for consumers. The German aviation market is recovering from the corona shock much more slowly than in many other EU countries. In the first half of the year, the offer was only just under 75 percent of the volume in the pre-crisis year of 2019. A good portion of the scarcity is homemade. The larger airports still have problems recruiting enough staff for the tough shift work involved in aircraft handling. In order to avoid renewed chaos like in the summer of 2022, tens of thousands of flights in the 2023 summer plan were canceled from the outset.
Low-cost airlines avoid the German market
In addition, low-cost airlines such as Ryanair, Easyjet or Wizz Air avoided Germany because of the high entry costs. In the first half of the year, their offer at German airports was only 63 percent of the 2019 level. With limited capacity, the companies first looked where they could make money most easily. This is easier in many other European markets than in Germany with the strong dominance of Lufthansa. “But the strategy will change when Boeing delivers and Ryanair can put new aircraft into operation as planned,” says Wissel. “Then they will come back to Germany and play to their advantage, because the high costs also affect the competition.”