The turning point was in 2012/2013 when low-cost carriers like Ryanair and easyJet started to really put pressure on the market domination of legacy airlines in the European aviation market. That’s according to research conducted by Europair, a Spanish air charter broker that specialises in organising charter flights around the world.
The folks at Europair have analysed air traffic data from 17 of the biggest markets across Europe and crunched the numbers from Eurocontrol – the continent’s air traffic control agency. The conclusion? Legacy airlines, like Lufthansa and Air France, still hold the upper hand – but only just.
The data covers all international and domestic flights across the 17 countries between September 2016 and August 2017. That data shows legacy airlines controlled 59% market share with the traditional carriers performing most strongly in Germany, Poland and perhaps surprisingly as the home of Ryanair, Ireland.
However, legacy airlines in the UK and Spain have got their work cut out with low-cost carriers dominating the market – controlling 54% and 55% market share respectively. Low-cost carriers aren’t doing too badly in Italy either – currently controlling 48% of market share but expected to dominate should Alitalia ultimately fail.
“The European air transport scene has changed radically since the deregulation that took place between 1993 and 1997,” explained Luis Matera, a business intelligence analyst at Europair.
“These changes enabled the creation of “real” competitors that challenged the mostly state-owned legacy airlines of the 90s, which were thus stimulated to restructure and face the appearance of multiple new competitors, specialised in different market segments such as air cargo, regional flying, charter and low cost.”
Europair believes that low-cost carriers perform best in countries where leisure travel is strong. It points to Spain as a classic example – the third most visited country in the world which saw a record-breaking 10.5 million inbound tourists in July. The majority of those got to Spain onboard a low-cost carrier.
Yet all is not lost for the legacy carriers. Analysts at Europair note the legacy airlines have been able to “adapt” – take Lufthansa expanding its own low-cost Eurowings subsidiary or even British Airways moving to a low-cost buy on board model on short haul flights.
“It is worth mentioning that legacy airlines have then been able to adapt and, while they haven’t been able to recover their lost market share, they are now holding their positions and growing in parallel with low-cost traffic,” the report notes.