Low-cost carrier and subsidiary of the Lufthansa Group Eurowings have announced an increase of its fares of at least 10% amid the disruptive chaos within the German aviation industry.
According to Eurowings’ Managing Director Jens Bischof, the economies of scale have tipped too significantly and are almost not in favour of the German aviation industry in Germany.
This means that the carrier is facing high operational costs whilst dealing with staff shortages, and is suffering cost increases of €100 million at a minimum.
Current fare prices at Eurowings are already approximately 10% more expensive compared to prices in 2019 but even this was not enough to keep the carrier afloat and more increases are ahead.
Airlines have been dealing with increased prices across the board. Jet fuel has become the most significant expense for airlines, especially after the unprecedented rise in the price of oil this year. Coupled with inflation and the rise in the cost of living, airlines have been struggling to maintain low fairs – this is particularly hard for low-cost carriers like Eurowings.
Jens Bischof recognises this and warned that the era of having the privilege to enjoy cheap flights is over. He also criticised other low-cost carriers that have stuck to low-pricing policies, stating how unsustainable they are:
“Flying is becoming more expensive and must also become more expensive for consumers. Economically and ecologically, it did not make much sense for aggressive competitors to paint a false picture of our industry with air fares the price of a cinema ticket.”
Elsewhere, the German low-cost carrier plans to remove hundreds of flights from its schedule in order to stabilise its offerings to its customers over the month of July.
The cancellations were deemed impossible to avoid as Germany has continued to suffer from extreme bottlenecks and shortages in its workforce, accompanied by a high 90% increase in passenger numbers over the past couple of months.
And while these cancellations are expected to last over July alone, Bischof warned that it could extend until August if the situation Eurowings is in did not improve:
“Nobody is happy about the image of our industry at the moment — least of all, us. Last-minute cancellations are very clearly on a downward trend, and Eurowings is working around the clock to improve the situation.”
Lufthansa, the primary airline of the Lufthansa Group has already removed 900 domestic German and intra-European flights from its Frankfurt and Munich hubs over the remainder of this month. The cancellations account for 5% of the national carrier’s scheduled capacity and only affect flights on Fridays, Saturdays, and Sundays.
The future is somewhat bleak for Eurowings. If oil prices continue to remain unstable and high, the carrier may have to look at abandoning its low-cost business model if they are forced to continue to increase fare prices to keep up.
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