ACI Europe has released Fierce Competitors, Fragile Foes, a comprehensive and empirical analysis of competition between European airports.
According to ACI (Airports Council International) Europe, the report has identified a new aviation market paradigm where the increasing buyer power of the airlines in Europe is squeezing airports ever further.
Fierce Competitors, Fragile Foes builds upon the Frontier Economics study published earlier this year, Airport Competition in Europe: Recent and Future Developments. Both look at how competition between airports works and has kept evolving, to a point where it is strongly playing out on a pan-European level. This takes place across a highly fragmented network of close to 700 airports – with choices of routes and aircraft bases monopolised by just seven major airline groups.
The structural market changes resulting from COVID-19 pandemic have only increased the power of airlines over airports, ACI Europe stressed. These include the relentless expansion of ultra-low-cost carriers, accelerating airline consolidation and tight airline capacity management. The constant level of route openings and closures – the so-called route churn – along with changes in capacity on existing routes provides indisputable evidence of airports being under constant competitive pressure to attract and retain air services.
Delivering the keynote address at the recent Routes Europe event in Łódź, ACI Europe director general Olivier Jankovec said: “Airport competition of course isn’t a bad thing, quite the opposite. But the fact is that the reality of airport competition remains largely ignored by national regulators across Europe. The result is airports being over-regulated with price caps and limited commercial freedom. Meanwhile, airlines enjoy unrestrained pricing power vis-à-vis consumers with no checks and balances whatsoever. Let’s be honest here: these regimes are all about protecting airlines and their shareholders, and they do little to protect consumers. This needs to change – and we look forward to further engaging with regulators on this.”
Image: Wizz Air
The reality of airport competition remains largely ignored by national regulators across Europe
