Thu. Nov 14th, 2019

Large air groups dominate their domestic markets in Europe

The operation purchase of Air Europa by IAG
It would leave a large majority of the Spanish domestic market in the hands of the British group. With the sum of the traffic of the Globalia airline, which in 2018 transported 11 million passengers within the Spanish market, the domestic market share of all its airlines would go from the current 57.5% to over 71%, a clearly monopolistic position that exceeds two thirds of the market. Currently the different airlines of the IAG group control 57.5% of the group's brands IAG, led by Vueling with 24.8 million passengers (30%), who follow Iberia Express, Air Nostrum (Iberia regional operator) and its own Iberia.

A situation that the competition authorities will look with magnifying glass, although industry sources say that the strong competition of the high-speed train It can serve the IAG group to refute the dominant situation.

In Germany, the Lufthansa group owns and lords domestic traffic and concentrates 88% of the quota

This situation of dominance of the IAG group is repeated, to a greater or lesser extent, in most major European markets. In the French internal market we find a similar situation, and it also has the high-speed train as a relevant factor in domestic transport. In France, the Air France group has almost 60% of the internal market: the Air France company, with 16.7 million passengers, has a 50% share, while its regional subsidiary Hop! It has an 18% share and a traffic of six million passengers, according to OAG (Official Airline Guide) seat offer data, the sector's reference database.

In Germany, the Lufthansa group owns and lords domestic traffic by concentrating an 88% share. 59% of the traffic is in the hands of the Lufthansa brand, with 20.7 million passengers, while the low cost The group, Eurowings, has a 29% share and more than 10 million passengers.

In both Italy and the United Kingdom, low-cost airlines have managed to capture part of the domestic market. In the first case, due to the weakness of the first local operator, Alitalia, and in the second, because the United Kingdom was the original market for the model, with the British EasyJet leading the way.

In this way, Alitalia continues to send in the domestic market, although with a share of 42% and 17 million passengers. After the Italian airline is Ryanair, with 30% of the Italian market. In the British case, the domestic market is fairly distributed among the first three operators: EasyJet dominates with a 32% share, followed by Flybe with 30% and British Airways with 24% of the total market.

On the other hand, the Air France-KLM group will "reevaluate" its current agreement with Air Europa in the coming weeks following the announcement of the purchase of the Globalia Group airline made this Monday by IAG. Last July, Air Europa and Air France-KLM created a joint venture Joint venture to operate routes with Latin America. This alliance involved reaching bilateral agreements and new permits and authorizations with countries in the region, including Brazil and Argentina. Air Europa offers 21 direct flights between Europe and Latin American countries, as well as another 17 in code-share with Aeromexico, Copa and Aerolineas Argentinas.

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