Why so many European airlines have failed:
Why so many European airlines have failed:
10-09-2019, 11:39 PM
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Originally Posted by SonicFlyer
10-11-2019, 09:31 AM
#3
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Or rather a very fragmented market that still has a lot of consolidation to do. The US has only three major legacy carriers left and a couple bigger LCCs. In Europe on the other hand there are still quite a few legacy carriers around and at least three bigger LCCs plus quite a few pure leisure carriers. And in most areas a very well run high speed train network. Not to mention, the standard of living and the average income is very different across the continent, and sometimes even within one country (9 of the poorest regions and at the same the richest one in middle and northern europe are in the UK).
Of course it doesn't help that many regulations are still national and many many airports do have curfews and the EU imposes very strict customer protection rules. There is of course a case to be made for more consolidation cutting the number of carriers to just something like 3 airline groups (IAG, LH, KLM/AF) and a few LCCs.
That said, the video highlights the difference in handling bankruptcies without mentioning it. Thomas Cook collapsed and was immediately grounded, but not all of its airlines. Condor, its german airline, is still flying and will most likely fly through the winter. Air Berlin went under because their main financier pulled the plug (in a dispute with Lufthansa), which could have happened at every month in the year in question. However, it continued to fly its own program for another three months, and a wetlease operation of 38 A320s for two more months still. Alitalia was in bankruptcy proceeding for a total time of three years until it was "rescued" by a deal between the italian government and an investor. It was even able to buy brand new airplanes during that time. However, i suspect before long it will be bankrupt again.
So there is the possibility of restructuring, but different countries follow different rules and regulations. And quite a few airlines are still owned by the country which they represent, which further distorts competition.
Of course it doesn't help that many regulations are still national and many many airports do have curfews and the EU imposes very strict customer protection rules. There is of course a case to be made for more consolidation cutting the number of carriers to just something like 3 airline groups (IAG, LH, KLM/AF) and a few LCCs.
That said, the video highlights the difference in handling bankruptcies without mentioning it. Thomas Cook collapsed and was immediately grounded, but not all of its airlines. Condor, its german airline, is still flying and will most likely fly through the winter. Air Berlin went under because their main financier pulled the plug (in a dispute with Lufthansa), which could have happened at every month in the year in question. However, it continued to fly its own program for another three months, and a wetlease operation of 38 A320s for two more months still. Alitalia was in bankruptcy proceeding for a total time of three years until it was "rescued" by a deal between the italian government and an investor. It was even able to buy brand new airplanes during that time. However, i suspect before long it will be bankrupt again.
So there is the possibility of restructuring, but different countries follow different rules and regulations. And quite a few airlines are still owned by the country which they represent, which further distorts competition.
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