Frankfurt Airport

US carriers to slash fourth quarter trans-Atlantic capacity as Europe's outlook dims

Increasing economic uncertainty in Europe has resulted in US carriers pulling back capacity to the continent later this year to proactively contain losses and a drop-off in traffic that could result from the increasing likelihood of Greece’s exit from the euro zone and the Euro falling to a two-year low against the US dollar. Delta has already stated its goal to reduce capacity 5% across the Atlantic during the fourth quarter, while United has already instituted schedule changes that show a pull-down in secondary European markets. US Airways, which during the last year has enjoyed marked success in its trans-Atlantic business segment, has not declared any plans regarding its capacity to Europe later in the year. But the carrier is launching several seasonal services on the back of its strong performance in the European market.

Trade group Airlines for America (A4A) estimates that during the fourth quarter of this year US carriers will reduce their capacity to Europe by 7.8% as they attempt to better manage seasonality and stave off effects of a recession on the continent. This change is significant as Western Europe is still the largest international market from the US.

Asia Pacific airports move up the ranks in 2011, with Beijing this year to overtake Atlanta

The rankings of the world’s busiest airports for 2011 show key developments and lasting changes in global aviation, although the world’s busiest airport by total passenger movements, Atlanta Hartsfield-Jackson International Airport, continued to hold off Beijing, the world’s second busiest airport, in 2011, according to Airports Council International (ACI). It is, however, expected that Beijing, driven by exponential GDP growth, will overtake Atlanta in 2012, ending the airport's 14-year reign in the top spot.

While Beijing Capital is the dominant airport in China, it is on track to become be the world’s busiest hub by the end of this decade, leaving London and even ambitious Dubai in its wake. And new developments will ensure the city of Beijing has an airport in the top spot: its new airport at Daxing, south of Beijing, could have up to nine runways and ultimate capacity to handle around 370,000 passengers per day, or a staggering 135 million passengers p/a. This would increase capacity at Beijing area airports to around 220 million p/a – almost a quarter of a billion passengers.

Lufthansa responds to Air Berlin at new Berlin airport, but success far from guaranteed

As Berlin's airport fragmentation ends with a new airport to open in Jun-2012, Germany's two biggest carriers are pursuing different strategies for the long-awaited airport, yet the strategies are forcing each other to respond. Air Berlin dominates short-haul traffic from the capital yet has high costs and low yields, indicating its transformation from LCC to hybrid carrier has not been followed by the market, whose premium passengers remain with Lufthansa, who has long been under-represented in Berlin, Germany’s largest city.

Air Berlin is banking on traffic feed, in particular from its oneworld members, to boost profitability, an outcome that may prove to be elusive as carriers continue to favour Frankfurt with its financial centre and accompanying premium traffic. Lufthansa will defend its market share from Air Berlin's chance of success with an equally ambitious measure: slashing costs by a third to better compete on short-haul traffic while continuing to ignore Berlin's long-haul traffic opportunities that Air Berlin has seized on. Each carrier wants the success the other has achieved, but neither are on a firm path to realise their ambitions.

German airlines adjust strategies as outlook darkens

Germany’s two largest airline groups, Lufthansa and Air Berlin, have announced wide-ranging measures to either preserve profitability, in the case of the former, or restore profitability, as they grapple with a gloomy regional economic outlook. Air Berlin, sandwiched between the low-cost and full-service space, will reduce its exposure to the struggling German leisure segment, which has been on a downward spiral all year.

Germany, the de facto leader of the European Union and a major underwriter of the bailout packages as a large holder of European sovereign debt, has been hit with renewed, and increasing, recession fears. German investor confidence fell to its lowest in more than 2.5 years in Sep-2011, the ZEW Center for European Economic Research said on 20-Sep-2011.

Intra-Europe traffic trends in the right direction, but outlook darkens for Europe’s carriers

European airlines continued to report positive passenger traffic results in Aug-2011, the final month of the summer peak travel period, when European airlines make the bulk of their revenue. Almost all of the major airlines reported year-on-year increases in load factor and passenger numbers, despite the increasingly worrying economic backdrop affecting business and consumer confidence across the region. If such uncertainty continues, European carriers may be in for a bumpy end to 2011.

Dubai Airport to become the world’s second largest international airport from November

A CAPA analysis of forward schedule data has revealed Dubai International Airport (DIA) will take the spot of the world’s second busiest international airport from Nov-2011, leap-frogging Frankfurt, Hong Kong and Paris Charles de Gaulle (CDG).