France made the first step to restrict flying in the battle against climate change in 2021 by imposing a ban on all short-haul flights that can be made by train in less than two-and-a-half hours. A French minister is now proposing a minimum price for European air fares to curb short-haul flying.
French Transport Minister Clement Beaune plans to submit the proposals to the European Union. Speaking to weekly French magazine, L’Obs, Beaune commented: “Plane tickets for 10 euros when we’re in the midst of the ecological transition, that’s no longer possible,” he said. “That doesn’t reflect the price for the planet.”
Beaune also confirmed that the French government has plans to increase taxes on flights to pay in the 2024 budget out later this month for improved rail services.
Meanwhile, a UK newspaper columnist has blamed the recent chaos in the UK air travel sector on its success. Flights have been operating at near-record load factors this summer season while capacity remains depressed, which means that any slight knock to the system such as the one experience by NATS has a substantial impact on the crowded skies above the UK and Europe.
IATA figures show that although global passenger traffic, measured in revenue passenger kilometres (RPKs), increased by 45% in the second quarter of 2023, industry-wide RPKs remain 12.4% below pre-pandemic levels. Load factors too are yet to reach 2019 levels but rose to 82.4% on an industry basis during the second quarter. However, European has experienced a rapid recovery over the first half of 2023, with 208million RPKs in June, more than 40% higher compared to January, reports IATA. This is among the fastest growth rates in RPKs across all regions, raising the market share of European airlines from 25% to 29% of the global air passenger market by the end of June. On a quarterly basis, European airlines experienced a 17.8% increase in total passenger traffic compared to the same period in 2022. Though not fully recovered by the end of the second quarter, European airlines managed to narrow the gap from pre-pandemic levels to less than 5%. This recovery was mostly led by domestic air passenger traffic, which has already surpassed its Q2 2019 level by more than 14.4%.
Demand for travel has recovered but that RPK growth is currently outpacing seat capacity, which is causing the jams in the systems around the world following interruptions to the system, be they errors or bad weather. As the industry enters into the Autumn/Winter season in the northern hemisphere, the pressure should ease despite the continued production delays and maintenance issues taking capacity out of the market. The domestic US market is already showing signs of a slowdown in demand due to economic pressures with air fares the first to suffer. Europe is a very different market, however. The proliferation of airlines enhancing competitions and drives down prices. Setting a floor for those low-cost carriers will impact those business models and could drive further consolidation.