Europe: Airline consolidation creates pressures for airports

A wave of consolidation among European airlines is creating pressure on the region's airports because it gives carriers more negotiating power over their hubs, the head of airports association ACI Europe said. European airlines have had a turbulent year. Monarch, Air Berlin and Alitalia have entered administration after struggling to compete as air fares fell. Lufthansa and easyJet are scooping up Air Berlin's assets and have also both made bids for some Alitalia operations. Meanwhile British Airways has acquired collapsed Monarch's valuable Gatwick slots. "Consolidation means less airlines in the market to chase, to serve your airport and open destinations. It also gives airlines more purchasing power, more power to dictate the conditions under which they serve an airport," ACI Europe head Olivier Jankovec said. While budget airlines such as Ryanair were already more flexible in shifting business to and from airports, the creation of big airline groups with multi-hub operations - IAG, Air France-KLM and Lufthansa Group - means traditional airlines can now also go elsewhere, he said. For example, Lufthansa this year upped pressure on Fraport, the operator of its main base in Frankfurt, by moving some of its A380 superjumbos to Munich. CEO Carsten Spohr said at Q3 results that he expected Lufthansa's negotiating position to improve at Duesseldorf, Stuttgart and Berlin airports, as a result of its planned takeover of parts of Air Berlin. "An airport cannot move, an airline can move to another location. With those three groups emerging in Europe, they all have multi-hub operations so they can play that game," Jankovec said. Airlines association A4E said in response that re-allocation of flights occurs as a response to passenger demand.<br/>