Analyses of the
European air
transport market
Annual Report 2007
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Air Transport and
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Annual analyses of the European air
transport market
Annual Report 2007
German Aerospace Center
Deutsches Zentrum
für Luft- und Raumfahrt e.V.
in the Helmholtz-Association
German Aerospace
Center
Air Transport and Airport Research
Linder Hoehe
51147 Cologne
Germany
Head: Prof. Dr. Johannes Reichmuth
Authors: Erik Grunewald, Amir Ayazkhani, Dr. Peter Berster,
Gregor Bischoff, Prof. Dr. Hansjochen Ehmer, Dr. Marc
Gelhausen, Wolfgang Grimme, Michael Hepting, Hermann
Keimel, Petra Kokus, Dr. Peter Meincke, Holger Pabst, Dr. Janina
Scheelhaase
December 2008
web: http://www.dlr.de/fw
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 2 Release: 2.2
Document Control Information
Responsible project manager: DG Energy and Transport
Project task: Annual analyses of the European air transport market 2007
EC contract number: TREN/05/MD/S07.74176
Release: 2.2
Save date: 2008-12-02
Total pages: 222
Change Log
Release Date Changed Pages or Chapters Comments
1.2 2008-06-20 Final Report
2.0 2008-10-10 chapters 1,2,3 Final Report - full year 2007 draft
2.1 2008-11-20 chapters 1,2,3,5 Final updated Report
2.2 2008-12-02 all Layout items
Disclaimer and copyright:
This report has been carried out for the Directorate-General for Energy and Transport in the
European Commission and expresses the opinion of the organisation undertaking the contract
TREN/05/MD/S07.74176. These views have not been adopted or in any way approved by the
European Commission and should not be relied upon as a statement of the European
Commission's or the Transport and Energy DG's views. The European Commission does not
guarantee the accuracy of the information given in the report, nor does it accept responsibility
for any use made thereof.
Copyright in this report is held by the European Communities. Persons wishing to use the
contents of this report (in whole or in part) for purposes other than their personal use are invited
to submit a written request to the following address:
European Commission - DG Energy and Transport - Library (DM28, 0/36) - B-1049 Brussels
e-mail (
http://ec.europa.eu/dgs/energy_transport/contact/index_en.htm)
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Content
2007 in brief…………………………..……………………………………….……………………….7
1
Air Traffic .......................................................................................................................15
1.1 Global Passenger and Freight Volume ........................................................................15
1.1.1 Global Passenger Volume .................................................................................15
1.1.2 Passenger Traffic Flows between the World Regions .........................................17
1.1.3 Global Freight Volume......................................................................................18
1.1.4 Freight Traffic Flows between the World Regions..............................................20
1.1.5 Comparison of Passenger and Freight Volume of Europe and the other
World Regions..................................................................................................
21
1.2 Air Traffic in EU-27 ....................................................................................................22
1.2.1 European Passenger Traffic...............................................................................22
1.2.2 Passenger Traffic Flows between EU Member States .........................................22
1.2.3 Passenger Traffic Flows between the EU-27 and other World Regions...............23
1.2.4 European Air Freight Traffic Volume .................................................................24
1.2.5 Freight Traffic Flows between EU-27 Member States ........................................25
1.2.6 Freight Traffic Flows between the EU-27 and other World Regions ...................26
1.3 Air Traffic in EU Member States .................................................................................28
1.3.1 Passenger Volume ............................................................................................28
1.3.2 Freight volume .................................................................................................29
1.3.3 Flight Volumes in EU Member States ................................................................31
1.4 Flight Efficiency..........................................................................................................33
1.5 General Aviation........................................................................................................33
2 Airlines...........................................................................................................................41
2.1 Passenger Airlines ......................................................................................................41
2.1.1 Supply by Airline Type ......................................................................................44
2.1.2 Air Transport Demand ......................................................................................52
2.1.3 Passenger Fleet.................................................................................................65
2.1.4 Airline Financial Performance............................................................................70
2.1.5 Alliances...........................................................................................................77
2.1.6 Competition .....................................................................................................85
2.1.7 Public Service Obligations – PSO .......................................................................90
2.1.8 Fare Development ............................................................................................91
2.2 Cargo Airlines............................................................................................................95
2.2.1 Cargo Airlines – Supply.....................................................................................96
2.2.2 Cargo Airlines – Demand................................................................................100
2.2.3 Cargo Airlines - Fleet ......................................................................................105
2.2.4 Cargo Airlines - Financial Performance............................................................107
2.2.5 Cargo Airlines - Alliances ................................................................................108
2.2.6 Cargo Airlines - Competition ..........................................................................112
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3
Airports........................................................................................................................115
3.1 Passengers...............................................................................................................115
3.2 Aircraft Movements .................................................................................................117
3.3 Freight.....................................................................................................................120
3.4 Ground Handling.....................................................................................................122
4 Air Transport Forecasts .................................................................................................126
4.1 Global Forecasts ......................................................................................................126
4.2 European Forecasts..................................................................................................128
4.2.1 Eurocontrol Short-Term Forecast September 2007 ..........................................129
4.2.2 Eurocontrol Medium-Term Forecast 2007-2013..............................................130
4.2.3 Eurocontrol Long-Term Forecast 2006-2025 ...................................................131
5 Regulatory Developments.............................................................................................132
5.1 International Aviation ..............................................................................................132
5.1.1 Horizontal Agreements...................................................................................133
5.1.2 Bilateral Agreements ......................................................................................134
5.1.3 Common Aviation Area with the EU’s Neighbours ..........................................134
5.1.4 Global Agreements.........................................................................................136
5.1.5 International Civil Aviation Organisation (ICAO) ..............................................139
5.2 Internal market ........................................................................................................140
5.3 Competition ............................................................................................................140
5.3.1 State Aid ........................................................................................................140
5.3.2 Infringements .................................................................................................141
5.3.3 Merger ...........................................................................................................142
5.4 Distribution Networks (CRS).....................................................................................142
5.5 Consumer Protection ...............................................................................................144
5.5.1 Passenger Rights in the European Union .........................................................144
5.5.2 Persons with Reduced Mobility .......................................................................144
5.5.3 Misleading Airline Ticket Websites ..................................................................145
5.6 Air Traffic Management...........................................................................................145
5.6.1 Single European Sky (SES)...............................................................................146
5.6.2 Functional Airspace Blocks (FABs) ...................................................................147
5.6.3 SESAR ............................................................................................................147
5.7 Airports ...................................................................................................................149
5.7.1 “Airport Package”..........................................................................................149
5.7.2 Slots...............................................................................................................152
5.8 Safety ......................................................................................................................153
5.9 Investigation of Civil Aviation Accidents, Incidents and Occurrence Reporting ..........153
5.10 Insurance.................................................................................................................154
6 Environmental development .........................................................................................155
6.1 The Year in Brief ......................................................................................................155
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6.2
Emissions Trading Scheme for Aviation ....................................................................157
6.3 Aviation Noise .........................................................................................................159
7 Consumer Issues ..........................................................................................................162
7.1 Punctuality...............................................................................................................162
7.1.1 Actual Punctuality...........................................................................................162
7.1.2 ATFM Delays ..................................................................................................167
7.2 Delayed Baggage.....................................................................................................169
7.3 AEA Flight Regularity ...............................................................................................170
7.4 Air Passenger Rights in the European Union.............................................................172
7.4.1 Implementation of Air Passenger Rights..........................................................174
7.4.2 European Consumer Centre Network .............................................................177
7.5 Hidden Charges.......................................................................................................179
7.6 Refund of Taxes, Fees and Charges..........................................................................179
7.7 Persons with Reduced Mobility: Regulation (EC) 1107/2006 .....................................180
7.8 Cabin Seating ..........................................................................................................180
8 Aircraft and Engine Manufacturers ...............................................................................182
8.1 Highlights of 2007...................................................................................................182
8.2 Aircraft Market Overview.........................................................................................183
8.2.1 Aircraft Orders Overview ................................................................................183
8.2.2 Aircraft Orders by Market Segments, Manufacturers and Types ......................185
8.2.3 Aircraft Deliveries by Market Segments, Manufacturers and Types ..................191
8.3 Engine Market Overview..........................................................................................197
9 Employment in European Air Transport.........................................................................200
9.1 Basic Concepts and Definitions of the EU Labour Force Survey .................................200
9.2 Definition of Air Transport in the Scope of National Accounts ..................................200
9.3 Employment Trends in European Air Transport.........................................................201
9.4 Coherence with other Employment Estimates ..........................................................203
10 Safety...........................................................................................................................205
10.1 Air Transport Safety .................................................................................................205
10.2 Notable Events......................................................................................................... 205
10.3 Safety Performance..................................................................................................206
10.4 List of Airlines Banned within the EU........................................................................210
10.5 EU-OPS (EU Operations)...........................................................................................211
10.6 The European Community SAFA Programme ...........................................................211
10.7 The European Aviation Safety Agency (EASA)...........................................................212
11 Annex ..........................................................................................................................215
11.1 Abbreviations ..........................................................................................................215
11.2 Geographical Coverage Information.........................................................................217
11.3 List of figures...........................................................................................................218
11.4 List of tables ............................................................................................................221
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2007 in brief
Traffic
In 2007 the worldwide passenger volume grew according to ICAO data from approximately
2,128 million to more than 2,260 million. This corresponds to a growth of approximately 6.2%.
During the same period the number of passenger kilometres grew slightly more than the
passenger volume from 3,941 billion passenger kilometres to approximately 4,201 billion
passenger kilometres. This corresponds to a growth of 6.6%.
The ICAO data also states that 41.6 million tonnes of freight were globally transported by air in
2007. This represents an increase in freight traffic volume of 4.5% compared to the previous
year’s result. The global tonne-kilometres rose in the same period from 149.7 to 158.4 billion,
which corresponds to an increase of 5.8%.
According to EUROSTAT, a total of 792 million passengers were transported by means of air
transport in the 27 EU member states (EU-27) in 2007. Compared to 2006, this corresponds to a
growth of approx. 7.2%. For intercontinental traffic, the relation between the EU and North
America was by far the most important one with approximately 60.1 million passengers in 2007.
In the EU-27, a total of approx. 12.6 million tonnes of freight and mail were loaded and
unloaded in 2007. Compared to the large extra-EU freight flows (9.9 million tonnes), the
quantity of freight carried between the individual EU member states is rather low, being only 2
million tonnes. The main linkage with regard to air freight/mail transport is seen between
Europe and North America. In 2007 more than 1.4 million tonnes were carried to North America
(a decline of 0.3%), and 1.3 million tonnes to Europe (7.1% growth).
With regard to the development of passenger traffic in the individual EU member states, an
increase in passenger traffic is revealed in all countries in the time frame of 2006 to 2007. The
growth in the new member states was above the average of EU growth in general.
Air traffic in Europe showed an increase of a good 5% in 2007
Source: Eurocontrol
Approximately 9.7 million flights were recorded in the so-
called Eurocontrol Area 1999 in 2007, with approximately
one million respective arrivals and departures which
crossed the border of the Eurocontrol district, 7.6 million
domestic flights within the Eurocontrol district and about
0.1 million flights which crossed the Eurocontrol district.
Compared to 2006, flight movement traffic increased by
about 5.1%.
9,682,139
9,211,495
2006 2007
Departures, arrivals,
internals and overflights
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Airlines
European air services play an important role in worldwide air transportation. Taking one week in
July 2007 as a reference for the summer period, 19% of the 582,000 movements originate in
one of the 27 EU member states; taking all 46 European countries into consideration, the global
share increases to 22.5%. Europe has about 146,000 intraregional flights at this time, whereas
nine thousand are on the North Atlantic, and nine thousand to Asia, both being the most
important interregional services worldwide. The most important route by far is Madrid –
Barcelona with a frequency of 486 flights per week per direction. The top international service is
Amsterdam – London Heathrow with 173 weekly take-offs per direction. The busiest
intercontinental air route is London – New York with 130 one way services per week. However,
the average number of seats on this route is, with 292 seats, far higher than on Barcelona –
Madrid with 157 seats.
Lufthansa German Airlines was the biggest carrier in terms of the number of flights, but it has
now been left far behind by Air France – KLM following the take-over. But these two airlines still
operate independently on the market. The average seat capacity of the top 25 airlines is 127 per
flight. The average seat capacity of the LCCs is, with 149 seats, somewhat higher.
Concentrating on the top 25 carriers per business model, the market share of the LCCs increases
to roughly one third. Within the LCCs, there is a somewhat higher concentration effect on the
top 2 carriers Ryanair and easyJet. Also, for regional airlines, the 2 biggest carriers Wideroe’s and
Binter Canarias are outstanding. The average seat capacity for these airlines is only 59 seats per
flight due to the high proportion of short haul regional aircraft. The concentration effect of the
holiday carriers on the top level is not as obvious as for the other business models; their average
seat capacity is, with 190 seats, higher than all the other models.
Worldwide there are more than 600 airline cooperation agreements, mainly code-sharing
partnerships, but only three global strategic alliances: Star Alliance, SkyTeam and oneworld.
With their networks, they try to cover at least the most important global traffic flows. The
number of members of these alliances is still increasing though there are also some airlines
withdrawing. In most cases, alliance member airlines apply the FSNC
1
business model. Some
FSNCs, especially in the Middle East, are not (yet) members of strategic alliances. In some cases
however, they cooperate with alliance members by means of code-sharing.
Of the worldwide 50 biggest FSNCs in terms of passenger numbers, 17 are based in Europe, 9
are US-American and 20 airlines are from the Asia-Pacific region. The North American airlines
have a 27% market share in terms of carried passengers, compared to the European airlines
with 27%. But this number shows the concentration and the size of the American carriers
compared to their European counterparts. The average flight distance in North America is 2300
1
Full Service Network Carriers
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km, 100 km less than in the rest of the world. The flight distance in Europe is, with 2270 km,
even shorter than in North America.
Airports
The top 20 airports worldwide account for 24% of the passengers handled worldwide. The two
busiest airports are Hartsfield-Jackson in Atlanta and O’Hare International in Chicago. The top
20 airports comprise of ten airports located in the USA, five in Europe and five in Asia. The
biggest European airport is London Heathrow in third place while the biggest Asian airport is
Tokyo International (Haneda) in fourth place. The top 20 European airports account for 14% of
the passengers handled worldwide, whereas 45% of the passengers in Europe choose one of
the top 20 airports in Europe. The top three places are occupied by London Heathrow, Paris
Charles de Gaulle and Frankfurt/Main, which also represent major hub airports in Europe with a
high share of intercontinental travel. In 2007, total number of passengers increased by 5.6%
worldwide compared to 2006.
Annual growth of the 20 biggest airports in terms of commercial air passengers worldwide
Source: ACI 2008
ranking regarding total numbers in 2007
3.8%
13.9%
2.6%
5.4%
0.8%
-5%
0%
5%
10%
15%
ATLANTA(ATL)
CHICAGO (ORD)
LONDON (LHR)
TOKYO (HND)
LOS ANGELES(LAX)
PARIS (CDG)
DALLAS (DFW)
FRANKFURT (FRA)
BEIJING (PEK)
MADRID (MAD)
DENVER (DEN)
AMSTERDAM (AMS)
NEW YORK (JFK)
HONG KONG (HKG)
LAS VEGAS (LAS)
HOUSTON (IAH)
PHOENIX (PHX)
BANGKOK (BKK)
SINGAPORE (SIN)
ORLANDO (MCO)
Relative change in the
Number of Passengers
2007 vs. 2006
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Annual growth of the 20 biggest airports in terms of flight movements worldwide
Source: ACI 2008
ranking regarding total numbers in 2007
5.0%
3.2%
0.9%
11.1%
0.7%
2.1%
-5%
0%
5%
10%
15%
20%
ATLANTA (ATL)
CHICAGO (ORD)
DALLAS (DFW)
LOS ANGELES (LAX)
DENVER (DEN)
LAS VEGAS (LAS)
HOUSTON (IAH)
PARIS (CDG)
PHOENIX (PHX)
CHARLOTTE (CLT)
PHILADELPHIA (PHL)
FRANKFURT (FRA)
MADRID (MAD)
LONDON (LHR)
DETROIT (DTW)
AMSTERDAM (AMS)
MINNEAPOLIS (MSP)
NEW YORK (JFK)
NEWARK (EWR)
MUNICH (MUC)
Relative change in the
Number of Movements
2007 vs. 2006
The top 20 airports in terms of commercial aircraft movements are located exclusively in the USA
or Europe. The biggest airport is again Hartsfield-Jackson in Atlanta, closely followed by O’Hare
International in Chicago. However, the difference in the number of commercial aircraft
movements in relation to the subsequent airports is more distinct compared to the situation
reflecting the above-described passenger numbers. This is partly due to the larger utilisation of
smaller aircraft for domestic air travel at US airports. The top 20 airports account for 21% of the
worldwide commercial aircraft movements, against the 12% of the worldwide aircraft
movements that take place at the top 20 European airports. Their share increases to 38% when
only aircraft movements at European airports are taken into account. The top 3 European
airports are Paris Charles de Gaulle, Frankfurt/Main and Madrid. London Stansted is the major
low cost carrier airport in Europe, having both the largest number of low cost operations and
the highest share of low cost flights in relation to the total number of take-offs.
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Annual growth of the 20 biggest airports in terms of commercial air freight worldwide
Source: ACI 2008
ranking regarding total numbers in 2007; ANC data includes transit freight
3.9%
5.4%
8.4%
7.9%
-10%
-5%
0%
5%
10%
15%
20%
MEMPHIS (MEM)
HONG KONG (HKG)
ANCHORAGE (ANC)
SHANGHAI (PVG)
INCHEON (ICN)
PARIS (CDG)
TOKYO (NRT)
FRANKFURT (FRA)
LOUISVILLE (SDF)
MIAMI (MIA)
SINGAPORE (SIN)
LOS ANGELES (LAX)
DUBAI (DXB)
AMSTERDAM (AMS)
NEW YORK (JFK)
TAIPEI (TPE)
CHICAGO (ORD)
LONDON (LHR)
BANGKOK (BKK)
BEIJING (PEK)
Relative change in
loaded and unloaded
freight and mail in
metric tonnes
2007 vs. 2006
In 2007, total air freight increased by 3.0% compared to 2006. The largest 20 airports in terms
of freight handled 48% of the total air freight worldwide. The three biggest freight airports are
Memphis (USA), Hong Kong (China) and Anchorage in Alaska, USA. The biggest European
freight airport is Paris in sixth place. However, the top 20 European airports account for 15% of
the total freight handled worldwide, while most of the freight is handled at US or Asian airports.
Freight operations in Europe are concentrated on only a few airports: 80% of the total air
freight is handled at the top 20 airports.
Forecasts
Air transport forecasts published in 2007 by Boeing, JADC, Bombardier and Embraer assume an
average worldwide GDP-growth rate between 3.0 and 3.2%. According to the outcome of the
global air transport demand forecast, yearly average growth rates between 4.7 and 5.0% for
passenger traffic and approx. 6% for freight traffic are indicated in the time horizon until 2026.
In the current Airbus Market Forecast, which was published at the beginning of 2008,
worldwide air traffic is forecasted to grow by approximately 4.9% until the year 2026. If we
take the number of 3,720 billion revenue passenger kilometres (RPK) from ICAO in 2005 as a
basis, this yearly growth will lead to approximately 10 billion RPK in 2025.
Eurocontrol published a short-term and a medium-term forecast in 2007. From 2007 to 2008, a
growth of 5.5% is expected for IFR movements, allowing a forecast margin of 4.4 to 5.5%. The
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expected growth considerably differs regionally, as already experienced in the past. In the
medium-term forecast, three scenarios were presented: Eurocontrol assume for the forecast
period from 2007 to 2013 an average annual growth in flight movements of 3.4% in the
Baseline-Scenario, 4.2% in the High and 2.6% in the Low-Scenario. In the forecast-year 2013,
these growth rates would lead to 11.3 million IFR movements in the Low, 11.9 million in the
Baseline, and 12.6 million IFR movements in the High-Scenario.
Regulatory
Regulatory issues and legislative developments in the year 2007 will be described in chapter 5.
While some aspects are mentioned in the other specific chapters concerning these topics (air
passenger rights as a consumer issue, environment, safety), this part of the annual analyses of
the European air transport market points out the work and cooperation between the European
Commission, the Council and the European Parliament as the decisive institutions for European
legislation.
Starting with the Community and its external competence besides the Member States and
therefore as a new player in the international and globalising field of civil aviation, the view is
focused on the internal Common Market and airline competition. The Community has
influenced many developments concerning consumer protection and environmental issues.
These topics play a major role in air transport, too. Air traffic management (ATM) as a technical
part of the air transport market is about to integrate in Europe and raise many questions in its
requirements and implementations. At the same time, the infrastructure on the ground has to
keep step with the developments to ensure, besides all other sectors, a safe and efficient
performance of international civil aviation. At the end, investigation of civil aviation accidents is
briefly mentioned.
Environmental
The European Commission aims to improve the quality of the environment by reducing the
growing climate change impact of international aviation. Therefore, international aviation will be
included in the already existing EU Emissions Trading Scheme for the limitation of CO
2
emissions
by the year 2012. On December 20th, 2007, the EU Environmental Council reached a political
agreement on a draft directive on this issue. The publication of a modified legislative proposal
on this basis is expected for spring 2008.
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Consumer Issues
In 2007, the consumer-relevant key performance parameters punctuality and baggage delivery
deteriorated in comparison with results for 2006.
Punctuality slightly decreased; baggage delivery slightly worsened
Source: AEA
Intra-European Departure Punctuality
79.4%
78.9%
20.6%
21.1%
2006
2007
on time delayed (>15 minutes)
Appraising the published results of the Association of European Airlines (AEA) for its members,
departure punctuality on intra-European services declined to 78.9% compared with 79.4% in
2006. On the arrival level, 77.7% of intra-European services met their schedules with no more
than 15 minutes delay, which is nearly the same result as in 2006 (77.9%).
The number of bags delayed per 1000 passengers carried by AEA-airlines was 16.6, thus slightly
inferior to the previous year’s situation with 15.7 bags delayed per 1000 boarded persons. As
per AEA, most of the change for the worse arose in the second quarter of 2007 due to
problems with transfer baggage systems at several European airports, a situation occurring in
December again.
15.7
16.6
2006 2007
delayed bags per 1,000 passengers enplaned
15.7
16.6
2006 2007
delayed bags per 1,000 passengers enplaned
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Manufacturers
Orders of Passenger and Cargo Aircraft (commercial operators
only)
Source: Ascend
The number of orders for passenger and cargo aircraft by
commercial operators saw a strong increase in 2007
compared to 2006. More than 3700 aircraft were ordered
in 2007, almost 50% more than in 2006. The number of
aircraft delivered saw a considerable increase in 2007. With
almost 1200 deliveries of commercial passenger and cargo
aircraft, this marks an increase of almost 12 per cent
compared to the previous year. The world fleet of
passenger aircraft in commercial operation with more than
20 seats has increased by more than 5 per cent in 2007
compared to the
preceding year. By the end of 2007, almost 20,000
passenger aircraft were in use at airlines and other
commercial operators.
Deliveries of Passenger and Cargo Aircraft (commercial
operators only)
Source: Ascend
1059
1184
2006 2007
+ 11.8%
2508
3743
2006 2007
+ 49.2%
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1 Air Traffic
1.1 Global Passenger and Freight Volume
Information on the development of worldwide air traffic is available in the form of traffic
statistics published by the International Civil Aviation Organization (ICAO). The basis for these
statistics are reports from ICAO member states on the air traffic activity of airlines based in their
territory. However, some of the data published by ICAO has to be estimated, since not all of the
190 ICAO member states participate in the survey. The most significant trends are nonetheless
considered to be correctly represented, since the major states in terms of air traffic, such as the
USA and the Member States of the EU, regularly report to the ICAO on the traffic levels
achieved by their airlines.
The ICAO distinguishes between international and national traffic. The combination of both
figures is the total traffic. The essential information for the allocation of a flight to the
appropriate category is the airline’s country of origin and the location of the originating and
destination airports. According to ICAO rules, a flight is classified as international if either the
airport of origin or destination (or both) is located outside the territory of the airlines’ home
country. Thus, cabotage (the transportation of passengers or goods within a country) by a
foreign airline is considered as international air traffic. Conversely, a flight by a French airline
from Paris to one of France's overseas territories, for example, is considered to be a domestic
flight, since the originating and destination airports are both located in the territory of the
airline’s home country. The ICAO also makes a distinction between scheduled and non-
scheduled airlines. According to the ICAO, scheduled airlines are the predominant means of
transportation. The following discussion only relates to flights performed by scheduled airlines.
1.1.1 Global Passenger Volume
For passenger transport, the ICAO records the number of passengers carried and the number of
passenger kilometres. Please note, however, that the latter measure only relates to the number
of seat kilometres sold. Figure 1-1 shows the development of air traffic levels for both domestic
and international scheduled airline traffic. Passengers are counted for each flight, with each
flight identified by its flight number. Passengers who change flight during their journey are
therefore counted multiple times.
Worldwide passenger traffic grew from approximately 1.5 billion to more than 2.3 billion
passengers in the decade from 1997 to 2007. This corresponds to an average annual growth of
approximately 4.5% and an overall growth of approximately 55%. It is clear that the dynamic
upward trend of the period prior to the stagnation between 2001 and 2003 is now continuing.
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Figure 1-1: Development of the global passenger volume
Source: ICAO 2008
1019
1013
1069
1109
1092
1092
1130
1241
1317
1366
438
458
489
538
532
547
561
647
705
762
1432 828
0
500
1000
1500
2000
2500
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Passengers carried (millions)
domestic international
International and domestic traffic differ in the pace of their development. In the decade 1997 to
2007, the annual volume of international traffic increased from 438 million to 828 million
passengers carried. This corresponds to an average annual growth rate of 6.6%. In the same
period, the level of domestic traffic increased from 1019 million to 1432 million passengers
carried. This corresponds to an average annual growth rate of only 3.5%. Thus, the proportion
of passengers carried on international flights increased from 30.1% to 36.6%, whereas the
proportion of passengers carried on domestic flights decreased from 69.9% to 63.4% in the
same period.
During the period studied (1997 to 2007), the number of passenger kilometres grew more
significantly than the passenger volume. Figure 1-2 shows the development of scheduled airline
traffic levels worldwide in terms of passenger kilometres performed each year.
+ 6.2%
Annual analyses of the European air transport market
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Release: 2.2 Page 17
Figure 1-2: Development of the global passenger kilometres
Source: ICAO 2008
1,105
1,115
1,174
1,239
1,214
1,228
1,281
1,430
1,522
1,583
1,468
1,512
1,614
1,779
1,716
1,736
1,739
2,015
2,200
2,358
1,656.60 2,544.54
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Passenger-km performed (billions)
domestic international
Since 1997, the level of traffic has increased from 2,573 billion passenger kilometres to
approximately 4,201 billion passenger kilometres. This corresponds to a growth of 63%,
compared to the growth in traffic volume of 55% discussed above.
1.1.2 Passenger Traffic Flows between the World Regions
The illustration below shows worldwide passenger flows (based on IATA data) and provides an
insight into the importance of air traffic for the different world regions. It is important to note
that the IATA data differs from the ICAO data. Furthermore, distortions are likely to occur with
respect to some aspects of the traffic structure, since not all airlines are IATA members.
According to IATA, their regional statistics on passenger traffic reflect approximately 87% of the
total volume achieved by IATA members. The values shown only reflect the levels recorded by
IATA. Please note also that the map only shows the main flows between the IATA-defined world
regions: North America, Central America, South America, Europe (including Russia), Africa,
Middle East, Asia and Oceania.
+ 6.6%
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Figure 1-3: The main passenger flows between world regions (2007)
Source: IATA WATS 52
nd
Edition
27.9 (27.9)
33.3
10.3
57.3
36.4
16.0
19.7
22.7
15.7
Million passengers carried
(+7.6%)
(+0.3%)
(+4.9%)
(+8.4%)
(+11.5%)
(+12.5%)
(+16.2%)
(+5.5%)
(+0.9%)
(+0.3%)
27.9 (27.9)
33.3
10.3
57.3
36.4
16.0
19.7
22.7
15.7
Million passengers carried
(+7.6%)
(+0.3%)
(+4.9%)
(+8.4%)
(+11.5%)
(+12.5%)
(+16.2%)
(+5.5%)
(+0.9%)
(+0.3%)
On the "North Atlantic route" between North America and Europe, passenger traffic increased
by 7.6% to 57.3 million passengers in the last year. This makes it by far the most significant
traffic flow between the world regions. The route with the second largest volume, between
Europe and the Far East, also saw an increase in passenger traffic over the last year. On the
latter route, traffic grew by 5.5% to 36.4 million passengers. Approximately 16.0 million
passengers (an increase of 11.5%) travelled between Europe and Africa using airlines that
submit data to the IATA regional statistics. For the African region, traffic was mainly
concentrated on a few North African countries that are preferred holiday destinations. On the
Pacific routes between North America and the Far East, passenger traffic increased slightly by
approximately 0.3% to 27.9 million passengers. Other significant passenger flows are seen
between North America and Central America (33.3 million passengers), between North America
and South America (10.3 million passengers), between Europe and the Middle East (19.7 million
passengers) and between the Far East and Oceania (15.7 million passengers).
1.1.3 Global Freight Volume
In 2007, the ICAO reported worldwide freight traffic to be nearly 41.6 million tonnes. This
represents an increase in freight traffic of 57.6% over the period 1997 to 2007. Figure 1-4
shows the trend over the past decade (1997 to 2007). It should be noted when attempting to
interpret the data that the US Department of Transportation (DOT) changed the survey basis for
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 19
domestic freight traffic in 2003. Domestic freight carried by non-scheduled airlines was not
considered until 2002, but thereafter was counted as domestic freight carried by scheduled
airlines. The corresponding values are shown accordingly in the ICAO statistics. In 2003, this
measure caused a 2% increase in the total recorded volume of worldwide air freight traffic.
Figure 1-4: Development of the global freight traffic volume
Source: ICAO 2008
10.7
10.7
10.8
11.4
10.6
12.6
13.9
14.9
15.2
16.2
15.7
15.8
17.3
18.8
18.0
18.8
19.6
21.8
22.6
23.6
16.3 25.3
0
5
10
15
20
25
30
35
40
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Freight tonnes carried (millions)
domestic international
The increase in the quantity of air freight has seen different growth rates for cross-border and
domestic traffic. In the decade from 1997 to 2007, the amount of international air freight
increased by a total of 61.1% to the current level of 25.3 million tonnes in 2007. For domestic
air freight traffic, the quantity was 16.3 million tonnes in 2007, which represents an increase of
5.6 million tonnes, or 52.3%, over the level in 1997. The proportion of international freight was
approximately 61% in 2007. Whereas domestic traffic plays the more significant role for
passenger transport, for the freight sector international traffic is more important.
This fact is even more apparent if one considers the performance levels shown in Figure 1-5. This
measurement shows that in 2007 approximately 83% of worldwide air freight traffic was
international traffic. Worldwide, total freight traffic increased from 102.9 billion freight tonne
kilometres to 158.4 billion freight tonne kilometres in the decade from 1997 to 2007, which
corresponds to an increase of 54%. This means that the volume of air freight traffic saw an
almost identical increase when compared to passenger traffic levels over the same period.
+ 4.5%
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Figure 1-5: Development of the global freight tonne-kilometres
Source: ICAO 2008
15.1
14.8
15.4
16.4
14.8
18.3
22.6
23.9
24.1
25.5
87.7
87.1
93.3
101.5
96.0
101.6
103.1
115.1
118.4
124.2
26.0 132.4
0
20
40
60
80
100
120
140
160
180
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Tonne-km performed (billions)
domestic international
1.1.4 Freight Traffic Flows between the World Regions
In contrast to the regional distribution of global passenger traffic, freight traffic is concentrated
on just a few corridors. The majority of freight was carried on three main routes:
Between North America and the Far East (over 3.9 million tonnes)
Between Europe and the Far East (over 3.9 million tonnes)
Between North America and Europe (over 3.1 million tonnes)
Further major flows of freight were seen between Europe and the Middle East (1.1 million
tonnes), between the Middle East and the Far East (0.9 million tonnes in 2006), between Europe
and Africa (0.6 million tonnes in 2006), between the Far East and Oceania (0.6 million tonnes in
2007) and between North America and South America (0.5 million tonnes). According to the
IATA, traffic levels did not grow on the Pacific route in 2007, whereas North Atlantic traffic grew
by 5.7% and the flow of freight between Europe and the Far East grew by 4.8%.
+ 5.8%
Annual analyses of the European air transport market
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Release: 2.2 Page 21
Figure 1-6: The main freight traffic flows between world regions (2007)
Source: IATA Regional Flow Statistics and IATA Origin-Destination Statistics
(3,947)
3,947
(-0.9%)
446
3,112
(+5.7%)
3,931
(+4.8%)
600
1,142
920
581
Freight tonnes carried (in thousands)
(+10.5%)
(+0.8%)
(+8.9%)
(+9.1%)
(+4.3%)
(3,947)
3,947
(-0.9%)
446
3,112
(+5.7%)
3,931
(+4.8%)
600
1,142
920
581
Freight tonnes carried (in thousands)
(+10.5%)
(+0.8%)
(+8.9%)
(+9.1%)
(+4.3%)
1.1.5 Comparison of Passenger and Freight Volume of Europe and the other
World Regions
Table 1-1 shows the growth rates of selected air transport indicators, which are reported by the
IATA and grouped in six different world-areas. The growth rates are based on the comparison of
the period January - December 2007 versus January - December 2006. The values of each area
are obtained by combining the air traffic performance of all IATA airlines resident in the
respective area. Industry means all IATA-Airlines taken together.
Table 1-1: Growth rates of
selected indicators
Source: IATA Monthly Traffic
Analysis December 2006 and
2007
Airlines based in the world
areas North America,
Europe, and Asia/Pacific
altogether achieved
approx. 90% of the world passenger kilometres in 2007. In 2007, the European IATA airlines
had a lower traffic growth than the whole industry. For example, RPK growth of all IATA Airlines
was 7.4%, while the RPKs performed by European IATA Airlines grew by only 6.0%. Only the
RPK Growth ASK Growth PLF FTK Growth ATK Growth
Africa 8.0% 7.0% 69.2 -6.0% 5.6%
Asia/Pacific 7.3% 5.7% 76.0 6.5% 6.2%
Europe 6.0% 5.2% 77.5 2.7% 3.9%
Latin America 8.4% 9.1% 72.9 -5.4% 7.8%
Middle East 18.1% 14.5% 75.9 10.1% 13.9%
North America 5.5% 4.6% 80.9 0.7% 2.1%
Industry 7.4% 6.2% 77.0 4.3% 5.3%
Jan-Dec 2007 vs. Jan-Dec 2006
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airline industry of North America had lower growth rates. Very high growth rates in 2007 are to
be observed in the Middle East.
1.2 Air Traffic in EU-27
1.2.1 European Passenger Traffic
Figure 1-7: Development of Passenger
Traffic in the EU-27
Source: EUROSTAT
According to the Statistical Office of
the European Communities,
EUROSTAT, a total of 792 million
passengers were transported by air in
EU Member States in 2007.
Compared to the preceding year, this
corresponds to a growth of approx.
7.2%. The total traffic in 2007
consists of domestic air traffic (175.8
million passengers, which
corresponds to approx. 22.2% of the
total traffic), intra-EU air traffic
(345.9 million passengers; 43.7%)
and also extra-EU air traffic (270.4
million passengers; 34.1%, see
Figure1-7).
1.2.2 Passenger Traffic Flows between EU Member States
Compared to 2006, the main passenger flows remained almost unchanged in 2007 (see Table
1-2). The strongest passenger flow is seen again between the UK and Spain (almost 36 million
passengers). However, passenger demand increased by only 2.0% from 2006 to 2007 on this
country pair. In 2007, 22 million passengers were carried (increase of 3.9%) between Germany
and Spain. Number 3 of the strongest intra-European flows (between UK and Ireland, 12.1
million passengers) shows a slight decrease of 1.3%. Extremely strong growth of the already
large volume (10.2 million passengers) is shown by the flow between Italy and Spain. Here,
passenger traffic increased by almost 21.4%. At the same time, passenger demand between
Germany and Italy increased slightly. Poland and Cyprus appear as the only new EU Member
States among the Top 25 ranking of the biggest European country pairs represented by Poland –
UK, UK - Cyprus and Poland – Germany.
175,758
345,905
270,389
166,794
319,616
248,487
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
2006 2007
Passengers in 1,000
Domestic Intra EU-27 Extra EU-27
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Release: 2.2 Page 23
Table 1-2: Main Passenger
Traffic Flows between EU
Member States in 2007
Source: EUROSTAT
1.2.3 Passenger Traffic
Flows between the
EU-27 and other World
Regions
The EUROSTAT air traffic
statistics also provides data
on passenger flows
between EU-27 and non-
EU countries. In total,
approx. 270 million
passengers were carried
from and to other regions
in the year 2007. Table 1-3
shows the main passenger
flows between EU-27 and
selected world regions.
Table 1-3: The main passenger flows of
the EU-27 from/to selected world
regions in 2007
Source: EUROSTAT
The passenger flow between EU-27
and non-EU-27 countries (85 million
passengers) consisted mainly of the
passenger traffic between the EU
and Switzerland and the EU-27 and
Turkey. The flight routes between
the EU-27 and Norway, the South
East European region (the states of
the former Yugoslavia) and the
Commonwealth of Independent
States contributed much less to the traffic of non-EU Europe. For intercontinental traffic, the
relation between the EU and North America was by far the most important one. More than 60
change to
2006
UK
↔
Spain 35,606 2.0%
Germany
↔
Spain 22,138 3.9%
UK
↔
Ireland 12,111 -1.3%
UK
↔
France 12,036 1.7%
Germany
↔
UK 11,533 0.8%
UK
↔
Italy 11,207 6.3%
Germany
↔
Italy 10,944 3.6%
Italy
↔
Spain 10,217 21.4%
UK
↔
The Netherlands 8,358 1.2%
France
↔
Spain 8,087 19.0%
France
↔
Italy 7,748 12.1%
Germany
↔
France 7,310 6.2%
Germany
↔
Austria 5,590 13.3%
UK
↔
Greece 5,454 -1.2%
UK
↔
Portugal 5,273 11.2%
Spain
↔
The Netherlands 5,031 8.7%
Germany
↔
Greece 4,993 4.3%
UK
↔
Poland 4,108 33.6%
Spain
↔
Ireland 3,592 16.3%
Spain
↔
Belgium 3,461 1.6%
UK
↔
Cyprus 2,976 -1.3%
Spain
↔
Portugal 2,947 27.5%
Italy
↔
The Netherlands 2,859 6.0%
Germany
↔
The Netherlands 2,607 -3.4%
Germany
↔
Poland 2,600 12.2%
Passengers 2007 in thousand
million
change to
2006
Europe exept EU 85.2 11.5%
North America 60.1 5.6%
Central America/Caribbean 11.1 -0.3%
South America 9.8 3.6%
Asian Republics of the Ex-USSR 1.4 12.0%
Near and Middle East 21.4 13.6%
Indian Sub-Continent 7.7 6.4%
Far East 26.1 4.8%
Oceania 1.8 -3.4%
North Africa 31.1 11.9%
Rest of Africa 14.1 6.1%
EU27: Passenger Flows from/to selected other Regions
in 2007
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million passengers (5.6% growth) were carried. Another significant intercontinental flow is the
one between Europe and Far East with the countries Japan, China, and Korea. Between the EU
and the Indian Sub-Continent, the demand grew by 6.4% up to 7.7 million passengers. In 2007,
further important passenger flows were seen between the EU-27 and North Africa with 31
million passengers (almost 12% growth), the Near and Middle East (21.4 million passengers)
and the rest of Africa (14 million passengers).
Figure 1-8: Share of world regions in extra-EU-27 traffic
Source: EUROSTAT
Figure 1-8 shows the share of different world regions in the extra-EU-27 traffic. The European
non-EU (31.6% of the total traffic of extra-EU-27), North American (22.3%) and North African
(approx. 11.5%) regions dominate the demand, accounting for more than 65% of all extra-EU-
27 passenger traffic. The Near & Middle East with almost 8%, the Far East with nearly 10% and
South Africa with 3.6% had lower shares. The smallest flow appeared to be Australia, the South
Sea Islands and Antarctica with barely 0.67%. One reason could be the fact that those
passengers who either stop-over or change planes will not be allocated to the country of their
final destination.
1.2.4 European Air Freight Traffic Volume
Besides the data on passenger traffic in the EU Member States, EUROSTAT also collects and
publishes information on the transportation of mail and goods. In contrary to passenger
transport, where in most cases journeys form a round trip, freight and mail are usually just
carried from the point of origin to the point of destination. Therefore, so-called „unpairs” are
likely to occur on the individual traffic relation, which for example means that between two
countries more goods are carried in one direction than in the other one. Furthermore it should
be noted that the declared destination airport is not necessarily the final destination airport of
the shipment.
Annual analyses of the European air transport market
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Release: 2.2 Page 25
Figure 1-9: Freight and Mail carried in the EU in 2006 and 2007
Source: EUROSTAT
To, from and within the EU-27, a
total of approx. 12.6 million tonnes
of freight and mail were handled in
the year 2007. This comprises of
shipments loaded and unloaded at
airports in EU Member States. The
mentioned total of 12.6 million
tonnes consists of 0.66 million
tonnes of freight and mail carried on
domestic routes, 2.0 million tonnes
of shipment carried on routes
between EU Member States and
nearly 10 million tonnes of shipment
carried on routes to non-EU
countries (see Figure 1-9).
Compared to 2006, the total freight
of 11.8 million tonnes increased by
6.6%. Whereas domestic traffic decreased considerably (-4.2%), intra-EU traffic increased
significantly by 11.6% and extra-EU traffic by 6.4%.
1.2.5 Freight Traffic Flows between EU-27 Member States
As already mentioned, freight traffic “unpairs” are likely to occur on individual traffic relations.
Consequently, the main freight and mail flows between individual EU Member States are
displayed in a destination-oriented way (see Table 1-4 on the next page).
Compared to the large intercontinental freight flows, the quantity of freight carried between the
individual EU Member States is rather low. The freight flow from Germany to UK shows the
highest volume (approx. 73,100 tonnes). However, in the opposite direction only approx.
52,100 tonnes were transported. From Belgium to the UK there is a similar, large freight flow.
Belgium plays – considering its economic power – an outstanding role with respect to the
individual intra-European freight relations due to the already mentioned operation of handling
points for big express-forwarding companies. Thus, besides the already mentioned flow from
Belgium to the UK, also the flows from the UK to Belgium (40,600 tonnes), from Germany
(39,900 tonnes) and from Italy (34,800 tonnes) to Belgium and also from Belgium to Spain
(35,100 tonnes) and Italy (31,700 tonnes), show a considerably high volume. Strong freight and
mail flows originate from Germany and target France (52,700 tonnes), Spain (46,600 tonnes),
Italy (37,100 tonnes), and Sweden (32,100 tonnes). To Germany, a relatively high volume of
2,024
9,910
687
658
1,814
9,311
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
2006 (EU-25) 2007 (EU-27)
Freight & Mail in 1,000 t
Domestic Intra-EU Extra-EU
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shipments is carried from France (46,300 tonnes), Italy (35,100 tonnes) and Belgium (33,100
tonnes).
Table 1-4: Important Freight Traffic Flows between EU Member States in 2007
Source: EUROSTAT
origin destination
thousand
tonnes
change to
2006
Germany
→
UK 73.1 4.3%
Germany
→
France 52.7 12.8%
UK
→
Germany 52.1 7.9%
Belgium
→
UK 50.4 4.1%
Germany
→
Spain 46.6 3.8%
France
→
Germany 46.3 18.1%
UK
→
Belgium 40.6 -4.7%
Germany
→
Belgium 39.9 5.3%
Germany
→
Italy 37.1 1.4%
Belgium
→
Spain 35.1 -4.6%
Italy → Germany 35.1 16.1%
Italy
→
Belgium 34.8 -5.5%
Belgium
→
Germany 33.1 24.9%
Germany
→
Sweden 32.1 6.3%
Belgium
→
Italy 31.7 0.3%
Belgium
→
France 29.7 3.5%
Spain
→
Germany 23.1 -0.4%
France
→
UK 22.5 14.8%
UK
→
Ireland 22.0 0.5%
Belgium
→
Sweden 21.9 1.9%
Italy
→
UK 21.9 14.9%
Freight flows in 2007
1.2.6 Freight Traffic Flows between the EU-27 and other World Regions
Table 1-5 shows the main linkages between the EU-27 and selected world regions. It should be
noted – as already described before – that the flights’ origins and destinations are not
necessarily identical with the regions of origin and destination of the goods carried. Thus, the
relations to the region Middle East show the third highest volume of freight and mail carried
compared to all relations considered. In 2007, more than 724,000 tonnes were carried from the
EU-27 to the Middle East region (7.2% increase) and more than 690,000 tonnes were received
from this region (0.9% increase). However, the major part of these shipments were probably not
originally from or destined for the region Middle East, but other parts of Asia and were only
transhipped in the Middle East. For example, big transhipment facilities operate at the airports in
Dubai and Doha (Emirate Qatar). The main linkage with regard to air freight/mail transport is
seen between Europe and North America. 1.4 million tonnes were carried towards the West (-
0.3% growth), and more than 1.3 million tonnes towards the East (7.1% growth). Furthermore,
the corridor EU-27 – East Asia (among others China, Japan and Korea) shows a large transport
volume. 1,210,000 tonnes (9.1% growth) were carried from the EU-27 directly to East Asia,
whereas more than 1.6 million tonnes have been received from this region by direct flights.
Annual analyses of the European air transport market
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Release: 2.2 Page 27
Further linkages occurred between the EU-27 and the Commonwealth of Independent States
(CIS; including Russia) and also the South Asia region including countries such as India, Pakistan,
Bangladesh and Nepal.
Table 1-5: Important Air Freight Traffic Flows between the EU-27 and other countries and regions of the
world in 2007
Source: EUROSTAT
unloaded from +/- to 2006 loaded to +/- to 2006
Norway 5909 12.7% 9731 -1.9%
Iceland 12260 -15.9% 15242 2.4%
Switzerland 31905 5.4% 25428 -2.3%
Turkey 98672 9.2% 98173 13.8%
Southeast Europe 3169 23.3% 7542 49.0%
CIS 250099 1.9% 191169 8.9%
East Africa 177054 6.7% 59167 -1.7%
North Africa 152760 55.9% 140256 26.3%
Central Africa 8793 1.5% 18841 8.0%
Africa South 142587 3.9% 153382 17.6%
West Africa 61608 -6.1% 148391 32.4%
North America 1323105 7.1% 1412281 -0.3%
Central America/Caribbean 76070 5.0% 108549 -1.3%
South America 217813 4.4% 217579 15.5%
East Asia 1672242 7.9% 1210581 9.1%
South Asia 239085 5.0% 201101 22.5%
Middle East 690033 0.9% 724376 7.2%
Oceania 39607 -5.2% 38730 -4.3%
EU-27: loaded and unloaded Freight in 2007 in tonnes
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1.3 Air Traffic in EU Member States
1.3.1 Passenger Volume
An increase of passenger traffic in the individual EU Member States (see Fig. 1-10 and 1-11) is
revealed in all cases in the time frame 2005 to 2007. Among the former EU-15 Member States,
in the time from 2006 to 2007, Portugal (10.4%), Austria (10.1%), Spain (8.6%) as well as
Finland, Belgium, Ireland and Italy all show above average growth rates (approx. 7.2%). Leading
members of the high traffic group are the United Kingdom (217 million passengers, 2.9%
growth), ahead of Germany (164 million passengers, 6.3% growth) and Spain (163 million
passengers). Strong growth can also be seen in most new EU Member States. Romania (41%),
Latvia (26.8%), Poland (24.6%) and Lithuania (22.8%) showed the highest passenger growth
figures.
Figure 1-10: Passenger Traffic of the former EU-15 Member States
Source: EUROSTAT
0
25,000
50,000
75,000
100,000
125,000
150,000
175,000
200,000
225,000
Au
s
tria
B
elgi
u
m
Denmark
Fin
lan
d
France
Ge
rma
ny
Greece
I
re
land
Ital
y
L
u
xembourg
N
eth
erland
s
Portugal
Spain
Sweden
U
n
ited
King
d
om
Passengers in 1,000
2005 2006 2007
Annual analyses of the European air transport market
Annual Report 2007
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Release: 2.2 Page 29
Figure 1-11: Passenger Traffic of the 12 new EU Member States
Source: EUROSTAT
0
2,500
5,000
7,500
10,000
12,500
15,000
Cy
prus
Czec
h
R
ep
u
bl
i
c
Es
to
n
ia
Hungary
La
tv
ia
Lith
u
an
i
a
Malt
a
Pol
a
nd
Sl
o
vakia
Slovenia
B
u
l
g
ari
a
R
o
mania
Passengers in 1,000
2005 2006 2007
1.3.2 Freight volume
It can be seen that there is a high quantity of freight and mail carried in those individual EU
Member States which are also outstanding with respect to passenger traffic such as Germany
(3.6 million tonnes) and the UK (2.4 million tonnes) in the year 2007. However, smaller countries
like Luxemburg (0.7 million tonnes), the Netherlands (1.5 million tonnes) and Belgium (1.4
million tonnes) also have a relatively high freight and mail traffic. A country’s traffic is
determined by its economic activities and the corresponding freight and mail flows. Thus,
Germany is an important country of origin and destination for shipments carried by air.
Furthermore, high handling volume, due to the country’s relevance with respect to logistic cycles
of air transport, is likely to occur. Amsterdam Airport is an important international hub for
passenger traffic. Since a lot of air freight and air mail are carried on passenger flights, the
airport is considered to be of similar importance for the handling of cargo shipments. Although
there is no mega-hub for passenger traffic in Belgium, the airports of Brussels and Liège operate
as important points for air freight handled by large express/forwarding companies.
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Figure 1-12: Freight Traffic of the former EU-15 Member States
Source: EUROSTAT
0
500
1000
1500
2000
2500
3000
3500
4000
Austria
B
el
g
iu
m
Denmark
Fi
n
la
nd
F
ra
n
c
e
German
y
Gre
ec
e
Ireland
I
t
aly
Luxemb
o
ur
g
Ne
th
erl
an
d
s
P
ortugal
Sp
ai
n
Sw
e
d
en
United
Kin
g
d
o
m
Freight in 1,000 tonnes
2005 2006 2007
Figure 1-13: Freight Traffic of the 12 new EU Member States
Source: EUROSTAT
0
10
20
30
40
50
60
70
80
Cy
p
ru
s
Czech R
ep
u
b
li
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nia
Hungary
Latvia
L
i
thuania
Malta
Poland
Slovakia
Sl
o
v
en
i
a
B
ulgari
a
R
o
man
i
a
Freight in 1,000 tonnes
2005 2006 2007
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1.3.3 Flight Volumes in EU Member States
Besides the traffic measured by the number of passengers and the amount of goods handled in
each country – the demand side of air transport – also the number of flights performed
constitutes an essential metric for air traffic. Figure 1-13 shows flight movements performed in
European countries in 2007. Whereas the statements on European traffic development, as given
in the preceding chapters, are based on data provided by EUROSTAT, data provided by the
European Organisation for the Safety of Air Navigation, EUROCONTROL, is now used. This data
is not directly comparable with that provided by EUROSTAT. On the one hand it does not only
refer to EU Member States, on the other hand it includes all flights performed according to
Instrument Flight Rules (IFR). IFR flights are not identical to those indicated by EUROSTAT in the
air traffic statistics. However, the flights indicated in the EUROSTAT air traffic statistics constitute
the major part of IFR flights recorded by EUROCONTROL. Besides airplanes departing from or
arriving in a country, overflights are also relevant for the evaluation and planning of en-route
airspace capacity. Overflights are performed by airplanes only crossing a country’s territory in the
air and thus do not take-off or land there.
Figure 1-14 shows the respective flights of each EU-member country, broken down by
departures, arrivals, domestic flights (here each flight includes the take-off and landing
procedure), as well as overflights. The number of overflights in a country does not necessarily
account for the importance of a country in terms of traffic, but its size as well as its position in
Europe. Thus, for example, the Netherlands show a high number of overflights compared to the
number of arrivals and departures. The same is true for Austria and Belgium/Luxemburg. Flights
departing from and arriving at airports located in the same country are called domestic flights.
For this parameter, the size of a country (in terms of both geographical size and population)
matters. European countries showing a distinct number of domestic flights are France, Germany,
Italy, Spain and the UK. For these countries, a high number of overflights is also indicated. For
the parameter departures and arrivals, major European countries are the UK, Germany, France,
Spain and Italy. When considering the totals of all categories, Germany is number one (about
3.2 million flight movements in 2007), followed by France (3.0 million) and the UK (2.5 million).
In total, approx. 9.7 million flights were recorded in Europe (including non-EU members) in
2007, with approx. 1 million arrivals and departures each, which crossed the border of the
Eurocontrol district, 7.6 million domestic flights within the Eurocontrol district and about 0.1
million flights which crossed the Eurocontrol district. Compared to 2006, flight movements
increased by about 5.1%. When considering flight movement growth in each country, high
growth rates in Central and East European countries are revealed. For example, flight movement
traffic in Lithuania grew by approx. 16.9% and in Latvia by 15.6%. However, when looking at
the absolute figures, these countries show only moderate traffic. Major countries in terms of
flight movement traffic show comparatively average growth (Germany 4.7%, France 5.9%, Italy
8.6%, Spain 8.5% and the UK 3.5%). According to Eurocontrol, August 31
st
, 2007 was the
busiest day ever. The states of the European Civil Aviation Conference recorded 33,506 IFR
flights on this day.
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Figure 1-14: IFR Flights in EU Member States in 2007
Source: Eurocontrol
0 1,000,000 2,000,000 3,000,000 4,000,000
AUSTRIA
BELGIUM/LUXEMBOURG
BULGARIA
CROATIA
CYPRUS
CZECH REPUBLIC
DENMARK
ESTONIA
FINLAND
FRANCE
GERMANY
GREECE
HUNGARY
IRELAND
ITALY
LATVIA
PORTUGAL (excl. Azores)
LITHUANIA
MALTA
NETHERLANDS
ROMANIA
SLOVAKIA
SLOVENIA
SPAIN
SWEDEN
UNITED KINGDOM
IFR Flights
DEPARTURES ARRIVALS INTERNALS OVERFLIGHTS
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1.4 Flight Efficiency
Flight efficiency is determined by the relationship between the optimal flight distance (in terms
of energy, cost and capacity) and the distance actually flown. For air traffic in Europe,
Eurocontrol calculates this flight efficiency by means of radar data collected and model
calculations of the optimal flight distances. The determination of flight efficiency requires
distinction between horizontal and vertical flight efficiency. The horizontal flight efficiency refers
to discrepancies from – as a rule – the shortest distance between the airports of departure and
destination. The vertical efficiency describes negative discrepancies with respect to the optimal
flight altitude, for example, in the case that an airplane has to be flown higher than required
from an operational point of view, due to the weather conditions. Just recently, Eurocontrol
have also emphasized the aspects of vertical flight efficiency.
Eurocontrol has published final data on flight efficiency for 2007 in its “Performance Review
Report 2007”. In the European airspace, monitored by Eurocontrol, the average distance of all
flights is approx. 5.8% longer than the flight route covering the shortest distance between
departure and destination airport (the so-called Great Circle Distance). The mentioned 5.8%
corresponds to a circuitous distance of 48.9 km per flight, on the basis of all flights recorded. As
a strategic objective, the "Performance Review Commission" (a consultancy board for
Eurocontrol in the field of efficiency enhancement) specifies an optimisation of the circuitous
route distance by 2 km per year. This optimisation target was clearly not reached in 2007;
instead there was an increase in detours performed by airlines in Europe (+0.7 km per flight on
average). As to the flight efficiency of the individual European states, it becomes evident that
countries showing high flight traffic, such as the UK, France, Italy and Germany, simultaneously
show the longest average circuitous routes. The analysis of vertical flight efficiency performed by
Eurocontrol indicates a kerosene consumption increase of 0.6% compared to the consumption
on an optimal vertical flight route. The mentioned relative figure corresponds to an average
quantity of 23 kg kerosene per flight. According to Eurocontrol statements, further efforts will
be made to improve flight efficiency.
1.5 General Aviation
The general aviation spectrum is rather broad and comprises general aviation for individuals, e.g.
for leisure purposes, non-scheduled business aviation, but also hospital flights and rotary-wing
traffic. Figure 1-15 gives a review of the different elements of general aviation with their
relationship to each other and commercial scheduled flights. The focus in this chapter is on non-
scheduled business aviation as interest in business aviation has grown considerably in recent
years. It is one of the largest and fastest growing segments of general aviation and is growing
faster than the market for scheduled passenger flights. However, data is difficult to obtain.
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Figure 1-15: General aviation and business aviation
Source: Eurocontrol 2006
In this report, general
aviation is defined
similarly to the
definition used by
Eurocontrol (2006) for
business aviation, i.e.
by aircraft type, as this
captures the essence
of this market
segment best. This
means that all aircraft (piston, turboprop and jet) of a size below e.g. the Boeing Business Jet or
B747 conversion are included in the definition; however VFR flights are excluded, as data is
difficult to obtain. However, Eurocontrol further excludes aircraft types from the definition of
business aviation which are not employed mainly for business purposes. One case is the
Piper 34, which is used more by training operators than in the business segment.
Business operators can be subdivided into three classes (Eurocontrol 2006):
Commercial: Aircraft flown for business purposes by a commercial operator.
These are typically on-demand charters and fractional operators.
Corporate: Non-commercial operations with professional crews employed (e.g.
corporate fleets).
Owner operated: Aircraft flown for business purposes by the owner.
Table 1-6 displays the classification of business jets broken down into seven categories according
to maximum take-off weight (MTOW), number of seats for passengers, cruising range and price.
Table 1-6: Classification of business jets
Source: HSH Nordbank 2005, Rolls Royce
Segment MTOW (lbs) Seats Cruising range Price
Entry 10 K - 13 K 4 - 7 seats 1300 - 2500 NM 2.4 - 6 Mio. USD
Light 13 K - 20 K 6 - 8 seats 1450 - 1970 NM 6 - 8 Mio. USD
Light Medium 20 K - 33 K 7 - 9 seats 1940 - 2700 NM 9 - 14 Mio. USD
Medium 33 K - 50 K 8 - 12 seats 2000 - 3400 NM 13 - 24 Mio. USD
Long Range 50 K - 80 K 5 - 19 seats 3100 - 4500 NM 21 - 34 Mio. USD
Very Long Range 80 K - 100 K 8 - 19 seats 4800 - 6750 NM 32 - 46 Mio. USD
Bizliner > 100 K 8 - 120 seats Up to 6300 NM 40 - 55 Mio. USD
Business Traffic
Business Aviation
Scheduled
Business-Only
Scheduled Flights
Rotary-Wing
Traffic
Large BizJets
Eg BBJ
State &
Military
Training
General
Aviation
(Individuals)
Hospital
Flights
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The entry class of jets is based on small and efficient engines like for example the FJ44 from Rolls
Royce or Williams FJ33 and thus form an alternative to pistons and turboprops. A popular
member of this class is the Cessna Mustang with a price of 2.6 Mio. USD (HSH Nordbank 2005).
The light class of business jets is the largest market segment which offers flexible capabilities, as
they only need a short runway for take-off.
However, there is a strong growth in the development of cheaper entry class jets which are able
to take off from short runways. One example is the Eclipse 500 for 1.5 Mio. USD, which needs
less than 1 000m of runway and is thus able to approach small airfields, offering great flexibility
to business travellers. In Germany, 154 airfields are potentially suited for such aircraft, compared
to about 5000 for the USA. However, the demand for entry class jets in Europe is currently at an
early development stage and still rather small. Eurocontrol expects the fleet in Europe to increase
by around 700 units by 2015. According to the FAA, the forecasted worldwide supply of very
light jets is around 500 aircraft per year by
2020 (Stern 2008).
Figure 1-16 depicts the fleet distribution
among the different classes of business jets.
In 2002, the light and light medium class
accounted for nearly two thirds of the whole
business jet fleet.
Figure 1-16: Worldwide fleet distribution in 2002
Source: HSH Nordbank 2005, Rolls Royce
Table 1-7 shows the forecasted worldwide
fleet development until 2022. The forecast shows a clear trend to larger business jets in the
future. In 2002, the largest segment was the light class with 4 550 jets, followed by 2 744 light
medium jets. For 2022, a fleet of 5 242 light medium jets is expected compared to 4 625 light
business jets. This is only an average increase of 0.1% per year, against which the light medium
business jets fleet increases by 3.3% on average per year. The largest increase in relative
numbers is forecasted for very long range jets. In 2002, there were 241 very long range jets. For
2022, a fleet of 1 274 very long range jets is forecasted, which equals an average annual
increase of 8.7%. Overall, the fleet of business jets is expected to increase by 3.0% per year on
average from 11 510 jets in 2002 to 20 875 jets in 2022.
Light
39%
Light Medium
24%
Medium
10%
Entry
11%
Long Range
12%
Bizliner
2%
Very Long
Range
2%
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Table 1-7: Worldwide fleet development until 2022
Source: HSH Nordbank 2005, Rolls Royce
Fleet Supply Supply Jets out of Fleet Average
2002 2003 - 2012 2003 - 2022 service until 2002 2022 growth p.a.
Entry 1,222 1,103 2,001 (14%) 530 2,693 4.0%
Light 4,550 857 1,976 (14%) 1,901 4,625 0.1%
Light Medium 2,744 1,706 3,759 (28%) 1,261 5,242 3.3%
Medium 1,152 1,325 3,109 (22%) 330 3,931 6.3%
Long Range 1,397 944 1,849 (13%) 528 2,718 3.4%
Very Long Range 241 485 1,052 (8%) 19 1,274 8.7%
Bizliner 204 102 202 (1%) 14 392 3.3%
Total 11,510 6,521 13,948 (100%) 4,583 20,875 3.0%
Figure 1-17 displays the number of business jets by country. In 2005, 1 217 business jets were in
use in Europe, of which the five largest markets (Germany, United Kingdom, France, Italy and
Switzerland) covered 68% of the jets. Generally, the number of business jets in a country is
strongly positively correlated with country size; however, Switzerland is an exception having a
disproportionally high number of business jets compared to its country size.
Figure 1-17: Business jets per country
Source: HSH Nordbank 2005, Jetnet
Denmark, 38
Sweden, 35
Netherlands, 33
Italy
121
France
153
Spain
60
Austria
54
Switzerland
116
Germany
232
United
Kingdom
208
Others (<10 Jets), 43
Ireland, 11
Finland, 13
Russian Federation, 16
Greece, 16
Luxembourg, 19
Belgium, 25
Portugal, 24
Table 1-8 shows the ownership structure of business jets in the aforementioned five largest
markets. Most business jets are operated by private companies and therefore the share of
business jets owned by private persons or the government is rather low. However, 26% of the
business jets in France are operated by the French state. In other countries, between 2% to 7%
of the business jets are owned by a government. The share of business jets operated by private
persons ranges from 1% for France, Italy and Switzerland to 6% and 7% for the United
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Kingdom and Germany respectively. In Europe, business jets are predominantly a matter for
companies.
Table 1-8: Ownership
structure of business
jets
Source: HSH Nordbank
2005, Jetnet
While Airbus and Boeing are the main manufacturers of airliners, the market for business jets is
rather fragmented. Figure 1-18 displays the market shares in terms of the number of aircraft
sold by the five biggest business jet manufacturers for the period 1993 to 2002 and a forecast
up to 2012.
The biggest business jet manufacturers are Bombardier (Canada) and Gulfstream (USA).
Figure 1-18: The biggest manufacturers of business jets in terms of the number of aircrafts sold
Source: HSH Nordbank 2005, Teal Group
25.5%
19.4%
16.5%
25.1%
12.0%
22.4%
19.4%
19.5%
27.9%
9.4%
1.3%
1.4%
0%
5%
10%
15%
20%
25%
30%
Bombardier
(Canada)
Cessna
(USA)
Dassault
(France)
Gulfstream
(USA)
Raytheon
(USA)
Other
1993 - 2002 2003 - 2012
In 2006, about 9% of all aircraft movements measured by Eurocontrol originated from general
aviation. Since 2003, the number of aircraft movements due to general aviation has risen nearly
twice as fast as commercial aircraft movements. Movements by general aviation, as registered by
Country Private Government Company Not specified
Germany 7% 3% 84% 6%
United Kingdom 6% 7% 86% 1%
France 1% 26% 71% 2%
Italy 1% 7% 90% 2%
Switzerland 1% 2% 97% 0%
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Eurocontrol, went up by 22% from 2003 to 2006, whereas commercial aircraft movements rose
only by 14% (European Commission 2008). However, aircraft movements of general aviation
are more widespread across air routes than commercial aviation. The top 500 bi-directional
business aviation routes in 2005 carried only 29% of business aviation, whereas the top 500 bi-
directional scheduled aviation routes in 2005 carried 41% of the commercial flights (Eurocontrol
2005). The market for business aviation is spread thinly: The top 100 airports in business aviation
handle only about 60% of the business aviation traffic, whereas this number increases to 75%,
if we look at the air traffic as a whole (Eurocontrol 2005).
Figure 1-19: Distribution of traffic
Source: Eurocontrol 2005
Table 1-9 shows the top 25 business aviation airports in Europe in terms of business aviation
departures. The busiest airport is Paris Le Bourget with an average of around 66 business
aviation departures per day in 2005. Paris Le Bourget is well ahead of the second placed airport
Geneva Cointrin with an average of 41 business aviation departures per day. The share of
business aviation at typical airports such as Paris Le Bourget, Cannes Mandelieu or Biggin Hill
exceeds 80% of all departures, whereas business aviation only accounts for less than 10% of
the departures at international airports such as Frankfurt/Main, Cologne-Bonn or Düsseldorf.
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Table 1-9: Airports with the most business aviation departures
Source: Eurocontrol 2005
Rank Prev. IATA Airport Business % Busiest
Rank Code 2005 2004 Growth Business Business Day
1 1 LBG Paris Le Bourget 65.6 64.9 1.0% 87.0% 115
2 2 GVA Geneva Cointrin 40.9 38.7 5.7% 20.0% 123
3 3 CIA Roma Ciampino 36.1 32.3 11.8% 39.0% 72
4 4 LIN Milano Linate 35.8 32.1 11.6% 21.0% 83
5 5 LTN London/Luton 31 27.7 11.8% 22.0% 68
6 7 NCF Nice 26.9 23.3 15.6% 15.0% 107
7 6 ZRH Zurich 26.7 26.8 -0.7% 7.6% 66
8 8 FAB Fanborough 20.8 19.2 8.6% 87.0% 44
9 12 VIE Wien Schwechat 20.3 17.6 15.5% 5.9% 48
10 9 MUC München 2 20.2 18.8 7.4% 3.7% 48
11 11 TOJ Madrid Torrejon 20.1 17.8 12.8% 69.0% 43
12 10 STR Stuttgart 17.7 17.9 -0.6% 8.8% 38
13 13 CEQ Cannes Mandelieu 16.1 15.1 7.0% 87.0% 46
14 14 CGN Cologne-Bonn 13.9 14.2 -2.6% 6.6% 30
15 18 BCN Barcelona 13.8 12.1 14.4% 3.3% 49
16 15 PMI Palma De Mallorca 13.5 12.9 5.0% 5.4% 34
17 20 BRU Brussels National 13.1 11.1 0.186 3.9% 41
18 17 DUS Düsseldorf 13 12.3 5.2% 4.7% 31
19 16 THF Tempelhof-Berlin 12.8 12.8 0.0% 35.0% 42
20 22 AMS Schiphol Amsterdam 12.5 11 14.0% 2.2% 34
21 31 LCY London/City 12.5 8.9 40.1% 13.0% 32
22 19 FRA Frankfurt Main 12 12.1 -0.3% 1.7% 41
23 24 BQH Biggin Hill 11.6 10 15.2% 86.0% 28
24 25 OLB Olbia Costa Smeralda 11.2 9.6 16.5% 30.0% 69
25 23 OSL Oslo/Gardenmoen 11.1 11 1.5% 4.0% 24
Business Deps/Day
Business aviation is point-to-point air travel. Most of the traffic takes place at small airports:
more than 50% of the traffic is from airports with fewer than 50 departures per day and only
30% of business aviation departures are from airports with more than 100 IFR departures per
day (Eurocontrol 2005). Table 1-10 shows the top 25 airports in Europe with the highest
proportion of business aviation departures. The share of business aviation departures ranges
from 90% for Wiesbaden to 51% for Braunschweig. Business departures per day lie in a range
from 1.2 to 65.5; however, the high value of 65.5 business departures per day on average for
Paris Le Bourget is rather the exception than the rule. There are on average about 8 business
departures per day at the top 25 airports in Table 1-10. The number of departures per day for
purposes other than business aviation lies between 0.4 and 9.5. However, Paris Le Bourget is
again rather the exception than the rule, as the average number of departures for purposes
other than business aviation is about two per day. The number of departures per day at small
airports with mainly business aviation traffic is very sensitive to supraregional events. For
example, the average number of business aviation departures per day at Samedan was 3.6 in
2005; however, when the World Economic Forum in Davos took place, a maximum number of
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16 departures per day were recorded. The smaller the airport, the higher the volatility of daily
departures due to supra-regional events near the airport tends to be.
Table 1-10: Airport with the highest proportion of business aviation departures
Source: Eurocontrol 2005
Rank Prev. IATA Airport Business Other Proportion Business Busiest
Rank Code Deps/Day Deps/Day Business Growth Day
1 3 WIE Wiesbaden 3.9 0.4 90% 4.5% 16
2 4 SMV Samedan 3.6 0.4 90% 9.0% 36
3 1 NHT Northolt 10.6 1.2 89% -3.8% 32
4 2 ZQC Speyer 2.6 0.3 89% 6.4% 12
5 5 LBG Paris Le Bourget 65.5 9.5 87% 0.9% 115
6 6 CEQ Cannes Mandelieu 16.1 2.4 87% 7.0% 46
7 7 FAB Farnborough 20.8 3.1 87% 8.5% 44
8 9 BQH Biggin Hill 11.6 1.8 86% 15.0% 28
9 10 SIR Sion 4.2 0.7 86% 15.0% 14
10 8 LTT La Mole 2.9 0.6 82% -1.1% 15
11 12 OBF Oberpfaffenhofen 2.5 0.8 75% 30.0% 12
12 11 Schwäb. Hall-Hessent 2.9 1.1 73% 44.0% 11
13 17 TOJ Madrid Torrejon 20.1 8.9 69% 13.0% 43
14 15 LYN Lyon Bron 6 3 67% 14.0% 18
15 13 Villacoublay 5.6 2.8 67% -18.0% 18
16 14 SNR Saint Nazaire 2.3 1.3 63% -1.5% 12
17 23 Pratica Di Mare 4.8 3.1 61% 5.9% 14
18 22 GLO Gloucestershire 1.5 1 61% 9.5% 12
19 18 LME Le Mans Arnage 1.2 0.8 58% 4.6% 20
20 21 CBG Cambridge 2.3 1.8 57% 0.9% 11
21 20 NVS Nevers Fourchambault 0.7 0.5 56% -4.9% 28
22 19 DOL Deauville 2.3 1.8 56% -15.0% 13
23 16 LHA Lahr 1.4 1.1 54% 13.0% 10
24 26 Ljungbyhed 2 1.7 54% 2.0% 14
25 24 BWE Braunschweig 6.4 6.2 51% -5.0% 18
Consultations on General Aviation in the European Community
With the Discussion Paper on General Aviation in the European Community
2
published in
February 2007, the European Commission attempted to look at relevant developments and
challenges that are taking place in this important segment of civil aviation. The aim of this paper
is to identify certain issues for the sole purpose of discussion with interested stakeholders. It
does not prejudge on any decision that the European Commission may take in future. A total of
74 contributions have been submitted. This includes: 10 contributions from Member States,
Norway and ECAC; 50 contributions from different organisations and associations; and 14
contributions from individuals.
2
http://ec.europa.eu/transport/air_portal/internal_market/general_aviation/consultation_en.htm
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2 Airlines
2.1 Passenger Airlines
Worldwide Departures
Figure 2-1 shows the total number of aircraft departures
worldwide in the third week of July 2007, of which 19%
originate in the Member States of the EU 27 and 22.5% in
the 46 countries of Europe. 22.5% of the worldwide aircraft
departures sum up to about 161 000, of which 159 000 are
passenger flights. 153 000 of these passenger flights are non-
stop. These are examined from different perspectives in more
detail below.
Figure 2-1: Global departures of commercial aircraft in the world in
the third week of July 2007
Source: OAG 2007
Figure 2-2: Worldwide departures in the third week of July 2007
Source: OAG 2007
Main Airports of STAR Alliance, e.g. Lufthansa
Main Airports of Oneworld, e.g. British Airways
Main Airports of Skyteam, e.g. Air France
Main Airports without Airline alliance
World Airline Traffic 2007
715 k Take-offs (one week in July)
SLOVENIA
CROATIA
V
OJVODINA
BOS NIA-
Be lgie n /Lux.
D ub lin
Is ta n bu l
Züri ch
Wien
Warschau
Prag
Par is
Brüssel
H e ls inki
Stoc kho lmOslo
A msterdam
Nizza
Basel
Rom
Lissabon
Europe
Rio de Janeiro
San Francisco
To r o n t o
Vancouver
Hong Kong
Sydney
Melbourne
Atlanta
Miami
OS L
ROM
LIS
FRA
AMS
PRG
South America
North America
Australia
Africa
Bangkok
Osaka
Johannesburg
De tr oit New York
292
146
112
15
9
4
9
57
17
2
23
9
4
2
4
6
2
1
1k=1,000
581.707;
81%
133.672;
19%
EU_27
Other Coutries in the World
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Figure 2-2 illustrates the distribution of the worldwide departures in the third week of July 2007.
A circled number displays the number of take-offs in thousands within a region, e.g. North
America or Europe, and a boxed number denotes the number of flights in thousands between
two regions, e.g. North America and Europe. Additionally, important airports are marked in
terms of the main airline alliance operating there.
North America is the region with the highest number of intraregional flight movements,
summing up to 292 000, while the route between North America and Europe has the highest
number of interregional flights, amounting to 9 000 in the third week of July 2007. The number
of intraregional flights clearly exceeds the number of interregional flights in most cases as
illustrated by Figure 2-2.
European Departures and Routes
In the Figures 2-3 and 2-4, which are extracts from Figure 2-2, air routes in Europe with a high
traffic volume regarding frequencies and seats offered, both on a weekly basis, are depicted.
The larger the arrow, the higher the corresponding number of take-offs and seats offered.
Figure 2-3: Main air routes in
Europe in terms of flight
frequency
Source: OAG 2007
Figure 2-3 illustrates the air
routes with the highest flight
frequencies per week. The top
three air routes are Barcelona
– Madrid, Monaco – Nice and
Milan – Rome with 486, 406
and 290 weekly take-offs in
one direction respectively. Yet
air traffic on the route
Monaco – Nice is solely a
helicopter service with a very
limited seat capacity. Top
routes in northern Europe are
Amsterdam – London
Heathrow, Hamburg –
Munich and Guernsey – Jersey
(both in the UK) with 173,
171 and 171 weekly take-offs
in one direction respectively.
London Heathrow –
SLOVENIA
CROATIA
V
OJVO DIN A
BOSNIA-
Belgien/Lux.
Dublin
Istanbul
Zürich
Wien
Warschau
Prag
Paris
Brüssel
Helsinki
Stockholm
Oslo
Amsterdam
Nizza
Basel
Rom
Lissabon
BCN-MAD (486)
26. LHR-JFK (130)
FCO-LIN (290)
ORY-TLS (192)
HAM-MUC (171)
NCE-MCM (406)
TFN-LPA (189)
ORY-NCE (174)
BCN-PMI (169)
JER-GCI (171)
AMS-LHR (173)
SLOVENIA
CROATIA
V
OJVO DIN A
BOSNIA-
Belgien/Lux.
Dublin
Istanbul
Zürich
Wien
Warschau
Prag
Paris
Brüssel
Helsinki
Stockholm
Oslo
Amsterdam
Nizza
Basel
Rom
Lissabon
BCN-MAD (486)
26. LHR-JFK (130)
FCO-LIN (290)
ORY-TLS (192)
HAM-MUC (171)
NCE-MCM (406)
TFN-LPA (189)
ORY-NCE (174)
BCN-PMI (169)
JER-GCI (171)
AMS-LHR (173)
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 43
Amsterdam is the top international air route within Europe. However, most air routes serve
domestic markets or travel to and from islands. The busiest intercontinental air route departing
from a European airport is London Heathrow – New York JFK with 130 take-offs per week.
Figure 2-4: Main air routes in
Europe in terms of seats offered
Source: OAG 2007
Figure 2-4 illustrates the air
routes with the highest
number of seats offered per
week. The top three are
Barcelona – Madrid, Milan –
Rome and London Heathrow
– New York JFK with 77 000,
41 000 and 38 000 seats
offered per week in one
direction. London Heathrow
– Dublin is the international
air route within Europe with
the highest number of seats,
summing up to 51 000 seats
offered in one direction.
Altogether, there are five
international routes within
the top ten. Because of the
intercontinental nature of
the route London Heathrow
– New York JFK, being third,
the demand is served by flights with high seat capacity per aircraft although the weekly flight
frequency is comparatively low. The average capacity per flight is 292 seats on the route London
Heathrow – New York JFK, whereas on the route Barcelona – Madrid the offered capacity is only
157 seats per take-off on average.
Figure 2-5 shows the number of routes per country in Europe, subdivided by European or
intercontinental route. There is a strong positive correlation between the size of a country and
the number of destinations served by its airports. The share of intercontinental routes increases
with country size as well. The top three nations in this ranking are the UK, Germany and France,
which have both the highest number of destinations and the highest share of intercontinental
destinations. A total number of 444 different destinations are served from the UK, of which 143
are intercontinental. 379 destinations are served from German airports, of which 130 are
SLOVENIA
CROATIA
V
OJV O DIN A
BOSNIA-
Belgien/Lux.
Dublin
Istanbul
Zürich
Wien
Warschau
Prag
Paris
Brüssel
Helsinki
Stockholm
Oslo
Amsterdam
Nizza
Basel
Rom
Lissabon
BCN-MAD (77 k)
3. LHR-JFK (38 k)
ORY-TLS (30 k)
CDG-LHR (25 k)
BCN-PMI (26 k)
LHR-DUB (26 k)
AMS-LHR (24 k)
ORY-NCE (28 k)
LHR-ORD (24 k)
FCO-LIN (41 k)
SLOVENIA
CROATIA
V
OJV O DIN A
BOSNIA-
Belgien/Lux.
Dublin
Istanbul
Zürich
Wien
Warschau
Prag
Paris
Brüssel
Helsinki
Stockholm
Oslo
Amsterdam
Nizza
Basel
Rom
Lissabon
BCN-MAD (77 k)
3. LHR-JFK (38 k)
ORY-TLS (30 k)
CDG-LHR (25 k)
BCN-PMI (26 k)
LHR-DUB (26 k)
AMS-LHR (24 k)
ORY-NCE (28 k)
LHR-ORD (24 k)
FCO-LIN (41 k)
1k = 1,000
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outside Europe. A total of 331 destinations are served from France, of which 134 are
intercontinental.
Figure 2-5: Number of destinations per country
Source: OAG 2007
0
50
100
150
200
250
300
350
400
450
United Kingdom
Germany
France
Spain
Italy
Netherlands
Turkey
Switzerland
Austria
Ireland
Greece
Belgium
Norway
Portugal
Sweden
Denmark
Czech Republic
Poland
Hungary
Finland
Cyprus
Romania
Bulgaria
Croatia
Latvia
Luxembourg
Malta
Iceland
Lithuania
Slovakia
Slovenia
Estonia
Former Yugoslav Republic of Macedonia
Country of Departure
Number of Destinations
Europa Intercont
Non-EU countries with bright coloration
2.1.1 Supply by Airline Type
For further analysis regarding airline types, flights are distinguished by those of (abbreviation in
brackets):
Full Service Network Carriers (“FSNCs”)
Low Cost Carriers (“LCCs”)
Regional Carriers (“Regionals”)
Holiday / Charter Carriers (“Charters”)
Full Service Network Carriers are scheduled airlines with a business model that focuses on
providing a diverse and extensive service. These are typically international operating companies
with a network-oriented system (normally with one or more hubs), covering a wide geographical
area and providing transportation in several different classes.
The Low Cost Carriers category comprises those airlines that offer low prices for the majority of
flights and which mainly operate on short and medium-distance routes with low overheads and
a relatively high load factor; these airlines use a no-frills business model.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 45
In most cases, Regional Carriers restrict their flight routes to a geographically limited area and
provide connecting flights for international airlines between regional and international airports.
They also provide decentralised connections between regional and national airports. Because of
the need to use smaller airports, these companies mostly operate small-scale aircraft suitable for
shorter travelling distances.
Holiday or charter airlines are categorised as being part of the non-scheduled traffic class, since
all-inclusive tour flights and travel-on-demand also belong to this category. Holiday airlines do
not generally sell tickets directly to their customers, but instead through ticket offices and travel
agencies as part of package tours. The number of airlines in this group is smaller than in the
others, since the role of package tour flights has continuously decreased during recent years,
with ever more seats being sold individually. The elimination of the distinction between charter
and scheduled airline traffic in the EU has led to an increasing number of holiday flights being
classified as scheduled traffic. Furthermore, more and more destinations now overlap with those
served by Low Cost Carriers.
FSNCs supply 61.4% of the weekly seats available at European airports in 2007, followed by
LCCs offering 27.6% of the total capacity. In contrast, Charter carriers and Regionals have
respective shares of only 6.3% and 4.7%. Figure 2-6 illustrates these relations in absolute
figures (FSNCs: 12,032,451 seats, LCCs: 5,406,246 seats, Charter/Holiday: 1,227,401 seats,
Regionals: 928,447 seats).
Figure 2-6: Distribution of European air transport by carrier type
Source: OAG 2007
Number of seats available (weekly)
0
2.000.000
4.000.000
6.000.000
8.000.000
10.000.000
12.000.000
14.000.000
Full Service Network Carrier Low Cost Carrier Charter/Holiday Carrier Regional Carrier
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Page 46 Release: 2.2
If we look at each airline type in more detail regarding market concentration, the top 25
European FSNCs cover 86.0% of the flights in this category. Concentration is even higher for
charter carriers: the top 25 charter carriers cover 97.0% of the charter market, which is
comparable with the low cost market, in which the top 25 LCCs provide 94.1% of the flights.
Market concentration is comparatively low for regional carriers: the top 25 in this category cover
only 70.0% of their market. If we extend the scope to the top 40 airlines in each category, the
general picture does not change much. Almost the whole market is served by the top 40 FSNCs,
Charters and LCCs (93.1%, 99.9% and 99.4% respectively), whereas only 83.7% of the
Regional market is covered by its top 40 airlines.
The top 25 airlines in each of the aforementioned four categories are studied in more detail
below, as most of each market is covered by its top 25 airlines.
2.1.1.1 Full Service Network Carriers (“FSNCs”)
Figure 2-7 displays the top 25 FSNCs in Europe for 2007 regarding weekly flights. The top 2
airlines are Lufthansa and Air France with 13 000 flights and 11 000 flights per week
respectively. Iberia and British Airways follow with 7 000 and 6 000 flights per week. As Figure
2-7 shows, the FSNC market is rather concentrated on around seven big airlines. Total market
volume is about 95 000 flights with 12 000 000 seats offered per week. Average seat capacity
per flight is 127.
Figure 2-7: Top 25 FSNCs in Europe in terms of flights per week
Source: OAG 2007
Flights per week
0
2.000
4.000
6.000
8.000
10.000
12.000
14.000
Lufthans
a
German Airl
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es
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r
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rance
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ay
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Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 47
Figure 2-8 shows the top 25 FSNCs in Europe in terms of seats offered per week. The ranking is
unchanged within the top rankings, except for British Airways and Iberia switching places.
Lufthansa, Air France, British Airways and Iberia still occupy the first four places.
Figure 2-8: Top 25 FSNCs in Europe in terms of seats per week
Source: OAG 2007
Number of seats per week
0
200.000
400.000
600.000
800.000
1.000.000
1.200.000
1.400.000
1.600.000
Lufthansa German Airlines
Air France
Bri
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ay
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2.1.1.2 Low Cost Carriers (“LCCs”)
Figure 2-9 shows the top 25 LCCs in Europe for 2007 in terms of weekly flights. The four
biggest LCCs are Ryanair, easyJet, Air Berlin and Flybe with 6 348, 6 117, 3 850 and 3 102
flights per week respectively. Flights per week decline sharply among the first six carriers and
then rather gradually down to 25
th
place with Air Southwest offering only 242 flights per week.
The market volume regarding flights per week is about 36 000 flights per week and roughly a
third of the FSNC market. Average seat capacity per flight is 149 seats - 22 seats more than
FSNCs offer on average. Figure 2-10 shows the top 25 LCCs in Europe in terms of seats offered.
The top rankings are largely unchanged. However, Ryanair extended its lead compared to the
number of seats offered by the following carriers. flybe switched places with TUIfly and
Meridiana with Vueling Airlines. The number of seats offered range from 1 200 000 for Ryanair
to 23 600 for Volare S.p.a.
Annual analyses of the European air transport market
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Page 48 Release: 2.2
Figure 2-9: Top 25 LCCs in Europe in terms of flights per week
Source: OAG 2007
Flights per week
0
1.000
2.000
3.000
4.000
5.000
6.000
7.000
Ryanai
r
ea
s
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Ai
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NI
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Figure 2-10: Top 25 LCCs in Europe in terms of seats per week
Source: OAG 2007
Number of seats per week
0
200.000
400.000
600.000
800.000
1.000.000
1.200.000
1.400.000
R
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anai
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FlyNordic
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 49
2.1.1.3 Regional Carriers (“Regionals”)
Figure 2-11: Top 25 Regionals in Europe in terms of flights per week
Source: OAG 2007
Flights per week
0
200
400
600
800
1.000
1.200
1.400
1.600
1.800
2.000
Wi
d
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s
F
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Bi
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as
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Figure 2-11 shows the top 25 Regionals in Europe for 2007 in terms of weekly flights. The 2
biggest Regionals are Widerøe’s Flyveselskap and Binter Canarias with 1 700 and 1 200 flights
per week respectively. The subsequent regional carriers only offer between around 600 and 200
flights per week. The third ranked Regional, Heli Air Monaco, offers 646 flights per week
(operated by helicopters only), the decline thereafter down to 25
th
place is rather slight. Market
volume is 16 000 flights and 939 240 seats per week, which is again only a fraction of the FSNC
market. The average seat capacity per flight of 59 is rather low, caused by the high share of
short haul and feeder flights with regional aircraft such as ATR 42 and Canadair Regional Jet.
Figure 2-12 shows the top 25 Regionals in Europe in terms of seats offered. The ranking differs
significantly from the flights per week ranking. Widerøe’s Flyveselskap and Binter Canarias again
occupy the first two places; however, rankings have changed due to the higher average seat
capacity per flight of 76 for Binter Canarias and only 44 for Widerøe’s Flyveselskap. However,
both Regionals again offer far more seats than the remaining top 25 Regionals. Rankings in
terms of weekly flights and seats differ significantly, one reason being the wide range of average
seat capacity per flight of each airline. Average seat capacity per flight ranges from five for Heli
Air Monaco, which is a helicopter service, to 181 for Domodedovo Airlines, which is not in the
top 25 ranking in terms of flights per week. However, Domodedovo Airlines is placed 12
th
in
terms of seats offered per week due to the comparatively high average seat capacity offered.
The market of Regionals is very heterogeneous, as a result of the majority of the airlines being
rather small.
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Figure 2-12: Top 25 Regionals in Europe in terms of seats per week
Source: OAG 2007
Number of seats per week
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
90.000
100.000
Bin
ter
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2.1.1.4 Holiday / Charter Carriers (“Charters”)
Figure 2-13 shows the top 25 charter airlines in Europe for 2007 in terms of weekly flights. The
3 biggest charter airlines are Condor, First Choice Airways and Thomsonfly with 807, 751 and
740 flights per week respectively. Thereafter, charter airlines become rapidly smaller in terms of
flights per week. Market volume is 6 431 flights and about 1 200 000 seats per week, which is
only a fraction of the FSNC market. However, the market is concentrated on around eight
airlines again. The average seat capacity per flight of 190 seats is significantly higher than the
corresponding value of other airline types, one reason being the need to keep the seat-km costs
low and the airlines' operational possibility of limiting flight frequencies.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 51
Figure 2-13: Top 25 charter airlines in Europe in terms of flights per week
Source: OAG 2007
Flights per week
0
100
200
300
400
500
600
700
800
900
Condor F
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Figure 2-14 shows the top 25 charter airlines in Europe in terms of seats offered. The ranking is
largely unchanged within the top rankings with Condor, First Choice Airways and Thomsonfly
occupying the first three places.
Figure 2-14: Top 25 charter airlines in Europe in terms of seats per week
Source: OAG 2007
Number of seats per week
0
20.000
40.000
60.000
80.000
100.000
120.000
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2.1.2 Air Transport Demand
The total number of airlines worldwide is not known exactly and is constantly changing due to
companies entering and exiting the market. This analysis therefore includes only a sub-total of
the number of airlines. In order to give a comprehensive overview of the world's major airlines,
the data used in this chapter is based on data provided by Airline Business magazine as it shows
the yearly performance figures for 200 major airlines, as well as monthly updates of current
performance figures. Airlines mentioned in the category “Europe” contain airlines from EU-27
and candidate countries. Financial reports from certain companies have also been taken into
account. All estimated figures have been indicated individually where they appear.
All figures are presented using the same format. This shows not only the type of airline and
geographical region, but also the 2007 traffic data and airline ranking (based on revenue
passenger kilometres). To aid comparison, each airline is given both a ranking for its class and an
overall ranking based on all categories analysed. In order to give a comprehensive overview of
the airline situation, the analysis is mainly based on the number of passengers carried and the
revenue passenger kilometres as well as the average airline load factor. Other aspects, such as
transport distance per passenger, are also taken into account. The airline ranking of 2006 is
shown as well.
The classification of airlines follows a model used by the DLR’s Air Transport and Airport
Research Unit in other publications. In several cases, this classification differs from the one used
by the magazine Airline Business. Therefore, a direct comparison with statistics published in
recent issues of the magazine is only possible to a limited extent. Because other chapters of this
report use the DLR classification, it was decided also to use this system in this chapter so that the
data can be compared as easily as possible with other topics in this report.
2.1.2.1 Full Service Network Carriers (“FSNC”)
The following Table 2-1 gives an overview of the 50 leading Full Service Network Carriers in
2007 and ranks the airlines according to individual performance.
As was the case in the preceding year, American Airlines led both the Full Service Network
Carrier rankings and the overall airline rankings. American Airlines is a member of the oneworld
Alliance operating from its major hubs at Dallas/Fort Worth and Chicago O’Hare. In total, 6 of
the top 10 carriers in this class originate from North America, which illustrates the importance of
this mode of transport in the United States. Number 2 in this ranking is (as in the preceding
year) a major European airline, the Air France-KLM Group.
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Table 2-1: The top 50 Full Service Network Carriers worldwide
Source: Airline Business
2007
RPK
class
Rank
2006
RPK
class
Rank
2007
RPK
total Airline Region Mill PAX Mill RPK Mill ASK %LF
111
American Airlines
North America
98.20 222,719 273,307 81.5
222
Air France-KLM Group
Europe
74.80 207,227 256,314 80.8
343
Delta Air Lines
North America
109.20 196,403 244,188 80.4
434
United Airlines
North America
68.40 188,857 228,201 82.8
555
Continental Airlines
North America
51.00 135,655 165,951 81.7
686
Lufthansa
Europe
56.40 117,656 158,881 77.0
767
Northwest Airlines
North America
53.70 117,335 138,603 84.7
879
British Airways
Europe
33.10 112,946 149,488 75.6
91810
US Airways ¹
North America
57.90 98,571 122,030 80.8
10 10 11
Qantas
Asia-Pacific
36.40 97,622 122,119 79.9
11 12 12
Emirates
Middle East
21.20 94,346 118,290 79.8
12 11 13
Singapore Airlines
Asia-Pacific
19.10 91,485 113,919 80.3
13 9 14
Japan Airlines
Asia-Pacific 47.20 85,888 124,383 69.1
14 14 15
Cathay Pacific
Asia-Pacific
23.30 81,801 102,462 79.8
15 15 16
China Southern Airlines
Asia-Pacific
56.90 81,172 109,733 74.0
16 13 17
Air Canada
North America
33.00 74,601 91,835 81.2
17 17 18
Air China
Asia-Pacific
34.80 66,986 85,257 78.6
18 16 19
All Nippon Airways
Asia-Pacific
50.40 61,224 90,937 67.3
19 19 20
Thai Airways
Asia-Pacific
19.60 60,305 76,830 78.5
20 22 21
China Eastern Airlines
Asia-Pacific
39.20 57,180 77,713 73.6
21 21 22
Korean Air
Asia-Pacific
22.80 55,354 76,181 72.7
22 20 23
Iberia
Europe
26.90 54,229 66,454 81.6
23 26 27
Virgin Atlantic Airways
Europe
5.60 40,546 53,046 76.4
24 23 28
Malaysia Airlines
Asia-Pacific
14.00 40,096 56,104 71.5
25 24 29
Alitalia
Europe
24.60 38,832 52,253 74.3
26 27 31
China Airlines
Asia-Pacific
10.30 33,793 43,591 77.5
27 31 32
TAM Linhas Aéreas
Latin America
27.90 33,500 47,599 70.4
28 36 33
Qatar Airways
Middle East
8.90 32,438 41,933 77.4
29 28 34
Saudi Arabian Airlines
Middle East
18.20 30,604 48,166 63.5
30 29 35
Alaska Airlines
North America
17.60 29,688 38,951 76.2
31 34 36
THY Turkish Airlines
Europe
19.00 26,874 39,384 73.6
32 32 39
Air New Zealand
Asia-Pacific
12.50 13,760 35,113 76.5
33 39 40
Swiss
Europe
12.70 25,852 32,186 80.3
34 38 41
Aeroflot Russian Airlines
Asia-Pacific
8.20 24,675 35,119 70.3
35 33 42
South African Airways
Africa
7.40 24,349 33,150 73.5
36 35 43
EVA Air
Asia-Pacific
6.20 24,226 29,785 81.3
37 44 44
LAN Airlines
Latin America
11.10 24,001 31,556 76.1
38 40 45
Asiana Airlines
Asia-Pacific
13.90 23,482 31,827 73.8
39 41 48
Hainan Airlines
Asia-Pacific
15.00 21,691 27,072 80.1
40 45 49
Finnair
Europe
8.70 20,304 26,878 75.5
41 43 50
Austrian Airlines
Europe
10.80 20,050 26,552 75.5
42 46 52
TAP Portugal
Europe
7.80 19,224 26,943 71.4
43 42 54
Air India
Asia-Pacific
4.10 18,710 30,114 62.1
44 65 56
Etihad Airways
Middle East
4.60 17,733 25,788 68.8
45 48 58
Philippine Airlines
Asia-Pacific
7.50 17,276 21,828 79.1
46 47 59
El Al
Middle East
3.70 17,068 19,750 86.4
47 57 60
Jet Airways
Asia-Pacific
11.40 16,914 24,447 69.2
48 49 62
Garuda Indonesia
Asia-Pacific
9.90 16,283 22,439 72.6
49 50 65
Aeroméxico
Latin America
8.40 15,650 22,670 69.0
50 54 69
Aer Lingus
Europe
9.30 14,807 19,633 75.4
Top 50 FSNC AIRLINES
1
2007 and 2006 annual traffic is for combined US Airways and America West
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A comparison ranked by the number of passengers lifts another US airline, Delta Airlines, to the
number one spot ahead of American Airlines and the Air France-KLM Group.
In 2007, 12 European airlines, 8 North-American airlines, 21 airlines originating from the Asia-
Pacific region and 9 from Latin America, the Middle East and Africa are to be found among the
top 50 FSN Carriers.
The Figure 2-15 shows airline passenger numbers for 2007, both as a total and split according
to region. The regions Asia-Pacific, Middle East, Africa and Latin America are grouped under
"Airlines Rest of World".
North American airlines account for the largest proportion, with a total of 489 million
passengers (36.1%) in the year 2007, compared to 290 million for European airlines (21.4%).
Given the limited number of North American carriers in the data set, these figures again
highlight the size of these airlines compared to their European counterparts.
Figure 2-15: Number of passengers carried by the top 50 FSNCs in 2007,
Source: DLR calculations based on Airline Business data
Passengers (Million)
1353
290
489
574
0
200
400
600
800
1000
1200
1400
1600
Airlines total
Airlines EU
Airlines North America Airlines Rest
Revenue Passenger Kilometres and Available Seat Kilometres for Full Service Network Carriers
are shown in Figure 2-16.
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Figure 2-16: RPK and ASK for the top 50 FSNCs in 2007
Source: DLR calculations based on Airline Business data
RPK and ASK (Million)
3,041,988
698,547
1,063,829
1,279,612
3,936,953
908,012
1,303,066
1,725,875
0
500000
1000000
1500000
2000000
2500000
3000000
3500000
4000000
4500000
Airlines total Airlines EU Airlines North America Airlines Rest
Mill RPK Mill ASK
North American airlines represent the largest share of revenue passenger kilometres
(1063 billion of 3041 billion in total). Their average length of passenger haul is 2395 km, which
is about 100 km less than the average distance travelled on airlines in the "Rest-of-World"
group. In this group the Asian airlines show significantly longer distances travelled per passenger
than the average. Conversely, the European airlines fall with 2230 km per passenger below the
overall average of 2308 km per passenger.
In 2006, US airlines were subject to debt restructuring measures ("Chapter 11"), which for some
airlines led to a stagnation of passenger numbers. The available seat kilometres were also
significantly reduced due to the airlines taking advantage of the special insolvency situation, for
example through the premature termination of leasing contracts and reductions in staff
numbers. As a result, Delta Air Lines decreased its ASK from 6.7% in 2005 to 5.6% in 2006.
Delta Air Lines emerged from its Chapter 11 restructuring process in April 2007, meaning that
no further decrease is to be expected. Restructuring measures in accordance with Chapter 11
may however be required again in future from time to time in the airline business.
The ratio of available seat kilometres to revenue passenger kilometres determines the load
factor. The average values are shown in the Figure 2-17.
.
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Figure 2-17: Average load factor of the top 50 FSNCs in 2007
Source: DLR calculations based on Airline Business data
Loadfactor (%)
76.0
76.5
81.2
74.4
0
10
20
30
40
50
60
70
80
90
100
Airlines total Airlines EU Airlines North America Airlines Rest
Taking an average for all top-50 airlines gives a load factor of 76.0%. It is mainly those in the
"Rest of World" group (74.4%) that come in below this value. In contrast, North-American
airlines show a fairly high load factor of 81.2%. Their load factor also exceeded 80% in the
preceding year. In Europe, five airlines (Air France-KLM, Iberia, Lufthansa, Swiss and Virgin
Atlantic) score above average, while only three (Air France-KLM, Iberia and Swiss) reach values
of more than 80%.
2.1.2.2 Low Cost Carriers
The following Table 2-2 shows the top 25 low cost airlines in 2007, ranked according to
revenue passenger kilometres.
Of the top 25 Low Cost Carriers, 11 are European and 5 are from North America. The leading
North-American LCCs are generally significantly bigger than their European equivalents, with
two US carriers featuring in the top 5. The largest company, Southwest Airlines, which
originates from the USA, even ranks among the world’s overall top 10 airlines. By contrast, there
are numerous relatively small Low Cost Carriers in Europe.
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Table 2-2: The top 25 Low Cost Carriers worldwide
Source: Airline Business
Rank
2007
RPK
cla ss
Ran
k
2006
RPK
class
Rank
2007
RPK
total Airline Region Mill PA
X
Mill RP
K
Mill ASK %LF
118
Southwest Airlines
North Ameri ca
88.70 116,361 160,314 72.6
2224
Ryanair
Europe
50.90 50,859 66,534 82.0
3525
Air Berlin
Europe
28.20 46,070 59,380 77.3
4326
JetBlue Airways
North Ameri ca
21.40 41,411 51,334 80.7
5430
easyJet
Europe
37.20 36,976 43,501 83.7
6638
AirTran Airwa
y
s
North Ameri ca
23.80 27,832 36,512 76.2
7951
Gol Transportes Aereos
Latin Ameri ca
22.40 19,966 29,196 68.4
8853
WestJet Airlines North Ameri ca
13.00 18,888 23,403 80.7
9
-
55
TUIfly
Europe
9.80 18,080 21,244 85.1
10 7 57
Virgin Blue
Asi a-Pacific
15.30 17,563 21,642 81.2
11 10 64
Frontier Airlines
Asi a-Pacific
10.40 15,806 20,095 78.7
12 12 87
Spirit Airlines
North Ameri ca
7.00 11,023 13,615 81.0
13 13 91
Jetstar
Asi a-Pacific
7.60 10,697 14,217 75.2
14 11 93
Transavia Airlines
Europe
5.40 10,486 13,288 78.8
15 24 96
AirAsia
Asi a-Pacific
8.60 9863 12,391 79.6
16 15 115
germanwings
Euro
p
e
7.90 7075 8692 81.4
17 14
122
Lion Airlines
Asi a-Pacific
6.60 6698 7500 89.3
18 16 124
GB Airways
Europe
3.00 6294 7703 81.7
19 17 125
Air Deccan
Asi a-Pacific
7.30 6283 8234 76.3
20 19 130
Jet2.com
Europe
3.90 5665 7697 73.6
21 18 131
Norwegian
Europe
6.40 5586 6956 80.3
22 22 134
Vueling Airlines
Europe
6.20 5501 7536 73.0
23 26 149
Cebu Pacific Air
Asi a-Pacific
5.40 4603 5753 80.0
24 28 164
spiceJet
Asi a-Pacific
3.30 3749 5769 65.0
25 23 178
SkyEurope Airlines
Europe
3.6 3680 4617 79.7
2007
Top 25 LCC AIRLINES
Unlike with the FSNCs, the highest number of passengers is seen for the European LCCs.
However, the contribution of the North American LCCs is greater than that of the “Rest-of-
World” group of airlines, which are mainly of Asian origin. The Figure 2-18 shows the total
number of passengers carried by LCCs worldwide and by region.
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Figure 2-18: Number of passengers carried by
the top 25 LCCs in 2007
Source:
DLR calculations based on Airline Business data
Southwest Airlines has a considerable
share (22.0%) of the total number of
passengers carried by all of the top 25
carriers. They are followed by JetBlue
Airways (5.31%) and the European
airlines Ryanair (12.62%) and easyJet
(9.22%), meaning that nearly 50% of all
passengers carried by the top 25 LCCs
can be attributed to these four airlines.
The mean distances travelled in Europe
are only about 1000 km per passenger,
compared to a global average of
1300 km. In North America, distances
per passenger amount to approximately 1500 km; for Asia-Pacific and Latin America the figure
is 1400 km. Due to Europe’s geographical structure, shorter city pairs are more often offered
here than in other regions such as North America.
Figure 2-19: RPK and ASK for the top 25 LCCs in 2007
Source: DLR calculations based on Airline Business data
RPK and ASK (Million)
507,015
196,272
215,515
95,228
657,123
254,684
285,178
124,797
0
100000
200000
300000
400000
500000
600000
700000
Airlines total Airlines EU Airlines North America Airlines Rest
Mill RPK Mill ASK
Passengers (Million)
403
191
154
87
0
50
100
150
200
250
300
350
400
450
Airlines total Airlines EU Airlines North America Airlines Rest
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For the LCCs, the average seat load factor is
75.9%. European airlines show an above-
average load factor of 79.7%, while the
North American airlines’ level is significantly
lower at 78.2%. The following Figure 2-20
shows the load factor by airline group in
2007.
Figure 2-20: Average seat load factor for the top
25 LCCs in 2007
Source:
DLR calculations based on Airline Business data
A noticeable difference here is the seat load
factor achieved by Low Cost Carriers
compared to that of Full Service Network
Carriers. Whereas the European LCCs have
an average load factor approximately 3.2
percentage points above that of European FSNCs, the reverse is true for the North American
airlines (FSNC load factor of 81.2% versus 78.2% for LCCs). European Low Cost Carriers still
differ from the traditional airlines in respect of their business concept (low overheads, high load
factor), although the situation in North America has now changed significantly, mainly in the last
year, due to the restructuring measures undertaken by several traditional airlines. In the course
of internal restructuring under Chapter 11 discussed above, several major airlines removed
capacity from the market in order to lower costs and increase efficiency. The improved business
strategies have resulted in a visible increase in load factor levels.
2.1.2.3 Regional Carriers
Airlines have been grouped in this class according to the classification system discussed in the
chapter titled “Airlines – Supply”, which means that the data here can only be compared
indirectly to the data on “Regional Carriers” published by Airline Business.
The dominance of North American airlines is obvious: 16 of the top 25 regional airlines are from
this region, compared to only two airlines from Europe and only five airlines originating from
Asia-Pacific. SkyWest Airlines tops this group in terms of revenue passenger kilometres. This
airline also ranks at number 37 in the top 50 for all classes. SkyWest Airlines is also the leading
airline in terms of the number of passengers carried. More than 34 million passengers were
carried; which is twice the number of passengers carried by the second largest company, Express
Jet. The following Table 2-3 gives an overview of the top 25 regional airlines in 2007.
Loadfactor (%)
79.0
79.7
78.2
78.6
0
10
20
30
40
50
60
70
80
90
100
Airlines total Airlines EU Airlines North America Airlines Rest
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Table 2-3: The top 25 Regional Carriers worldwide
Source: Airline Business
Rank
2007
RPK
class
Rank
2006
RPK
class
Rank
2007
RPK
total Airlines Region Mill PAX Mill RPK Mill ASK %LF
1137
SkyWest Airlines
North America
34.40 28,789 36,957 77.9
2263
ExpressJet
North America
17.40 16,204 21,842 74.2
3376
American Eagle Airlines
North America
18.50 13,422 18,044 74.4
4677
Shenzhen Airlines
Asia-Pacific
9.50 13,346 17,161 77.8
5580
Hawaiian Airlines
North America
7.10 12,759 9,076 87.4
6788
Xiamen Airlines
Asia-Pacific
9.20 10,974 14,912 73.6
7489
Mesa Airlines
North America
16.10 10,944 14,451 75.7
8895
Atlantic Southeast Airlines
North America
12.00 9949 12,988 76.6
911101
Sichuan Airlines
Asia-Pacific
6.80 8524 10,817 78.8
10 12 104
Pinnacle Airlines
North America
11.50 7883 10,624 74.2
11 10 108
Comair
North America
9.30 7414 9872 75.1
12 14 181
Air Canada Jazz
North America
9.70 6861 9234 74.3
13
9
119
SAS Norge
Europe
9.70 6846 9836 69.6
14 13 120
Midwest Airlines
North America
3.80 6786 8733 77.7
15 16 133
Chautauqua Airlines
North America
7.80 5516 7335 75.2
16 24 136
VIM Airlines
Asia-Pacific
2.10 5295 7021 75.4
17 25 140
Allegiant Air
North America
3.30 5054 6216 81.3
18 17 147
Horizon Air
North America
7.60 4695 6396 73.4
19 20 150
Lufthansa CityLine
Europe
6.80 4538 6653 68.2
20 21 162
Air Jamaica
Latin America
1.70 4345 6432 67.6
21 19 156
Shuttle America
North America
4.00 4295 5841 73.6
22 22 169
Aviacsa
Latin America
3.40 4096 6301 65.0
23 33 163
Republic Airlines
North America
4.50 3973 5203 76.4
24
18
172
US Airways Express
North America
8.20 3676 5316 69.2
25 29 174
Skymark Airlines
Asia-Pacific
3.70 3358 4471 75.1
2007
The dominance of North American airlines in this
class is also illustrated by the following chart.
Figure 2-21: Number of passengers carried by the top
25 Regional Carriers
Source: DLR calculations based on Airline Business data
Regional Carriers have much greater importance
in the USA than they do in Europe or Asia due to
the geographical situation on the North
American continent and in the USA in particular.
Although the USA is much less densely
populated than Europe, long distances are
mostly covered by plane. Small airports are used
Passenger (Million)
228
17
175
36
0
50
100
150
200
250
Airlines total Airlines EU Airlines North America Airlines Rest
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mainly by regional jets, which provide connectivity to the main hubs. In Europe, the outsourcing
of regional services is less common than in the USA. Often, FSNCs cover short-distance city pairs
themselves. Also, an increasing level of cooperation between airlines and railway operators can
be observed, in order to offer trains as feeder services.
The above analysis of passenger kilometres achieved has already demonstrated the dominance
of North American airlines in the rankings. Figure 2-22 shows the regional distribution of the
total RPKs and ASKs achieved by airlines within this class. It can be seen that in 2007 more than
70% of the total RPKs and ASKs (by the top 25 airlines) were attributable to North American
airlines.
Figure 2-22: RPK and ASK for the top 25 Regional Carriers
Source: DLR calculations based on Airline Business data
RPK and ASK (Million)
209,542
11,384
148,220
49,938
271,732
16,489
188,128
67,115
0
50000
100000
150000
200000
250000
300000
Airlines total Airlines EU Airlines North America Airlines Rest
Mill RPK Mill ASK
The big differences seen here are mainly due to the number of airlines and the number of
passengers, but are also in part due to the greater average distance per passenger. While in
Europe and Asia the mean distance flown per passenger is 598 km and 641 km respectively,
North American regional airlines show an average distance flown of 911 km per passenger.
Overall, the average across all airlines is 877 km.
Due to the gap between available seat kilometres and passenger kilometres actually performed,
the corresponding seat load factor is lower on average for this airline class than for the other
classes. The overall average value (74.7%) is significantly lower than those achieved by FSNCs,
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LCCs and Holiday/Charter Carriers (see
below). European airlines have the lowest
value in this class, indeed in almost any
airline class (68.9%). On average, aircraft of
these airlines are only loaded to two-thirds
capacity. By contrast, the American airlines
achieve an average seat load factor of
76.0%, which significantly exceeds the mean
value. Nevertheless, there are only two
airlines in this class that make the 80% range
of the seat load factor.
Figure 2-23: Average seat load factor for the top
25 Regional Carriers
Source:
DLR calculations based on Airline Business data
2.1.2.4 Holiday/Charter Carriers
The following table lists the top 10 holiday and charter airlines.
Table 2-4: The top 10 Charter Airlines worldwide
Source: Airline Business
Rank
2007
RPK
class
Rank
2006
RPK
class
Rank
2007
RPK
total Airline Region Mill PAX Mill RPK Mill ASK %LF
1146
Thomsonfly¹
Europe
9.40 23,148 26,621 87.0
2247
Condor Flugdienst
Europe
7.30 22,675 25,743 88.1
3461
First Choice Airways
¹
Europe
5.60 16,763 18,151 92.4
4666
Thomas Cook Airlines
Europe
5.00 15,492 17,956 86.3
5568
Monarch Airlines
Europe
6.10 14,825 17,957 82.6
6881
Air Transat
North America
2.90 12,632 14,166 89.2
7782
MyTravel Airways
Europe
3.60 12,425 13,804 90.0
8986
Corsairfly
²
Europe
1.60 11,533 13,953 82.7
91090
XL Airways UK
Europe
3.00 10,887 12,282 88.6
10 11 110
Martinair
Europe
2.20 8989 12,180 73.8
2007
1
From the year 2009 under the joint brand Thomson Airways
2
From the year 2008 as TUIfly
Loadfactor (%)
74.7
68.9
76.0
73.3
0
10
20
30
40
50
60
70
80
90
100
Airlines total Airlines EU Airlines North America Airlines Rest
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The data obtained for 2007 mainly related to European charter airlines. Air Transat is the only
North American airline to appear in the Top 10 ranking list, and they play only a minor role
compared to the major holiday airline, Thomsonfly. The passenger numbers emphasise the
strong position of European Airlines in this class thanks to the importance of European charter
traffic in recent times (mainly flights to tourist destinations around the Mediterranean Sea).
Europe has always been more dominant in this sector than other geographical regions (see
Figure 2-24).
Figure 2-24: Number of passengers carried by the top 25 Holiday/Charter Carriers
Source:
DLR calculations based on Airline Business data
Passenger (Million)
46.7
43.8
2.9
0
5
10
15
20
25
30
35
40
45
50
Airlines total Airlines EU Airlines North America
Thomsonfly was also the leading airline in terms of passengers carried during the period studied,
marking this company out clearly from its closest competitors, Condor Flugdienst, First Choice
Airways and Thomas Cook Airlines UK. As the leading airline, Thomsonfly carried 9.4 million
passengers (more than 20% of all passengers carried by the top 10 airlines). The German-British
owned Thomas Cook Airlines UK, which was founded by the merger of several travel
companies, only carried around 10% of all passengers.
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Analysis of the available seat kilometres and the revenue passenger kilometres data reveals the
high distances travelled compared to all classes. On average, each passenger was carried over a
distance of approximately 2866 km, with the European airlines even showing slightly higher
values. Overall, the carrying distances are above the average rate for Full Service Network
Carriers.
Figure 2-25 shows the
number of available seat
kilometres and the level
of demand in 2007.
Figure 2-25: RPK and ASK
for the top 10
Holiday/Charter Carriers
Source: DLR calculations
according to Airline Business
The average seat load factor of all
holiday/charter airlines based on the data
for available seat kilometres and revenue
passenger kilometres shows a relatively high
average value of 86.1%. First place in this
group goes to First Choice Airways (92.4%
load factor), followed by MyTravel Airways
(90.0%). The only North American airline in
this group, Air Transat, achieved a load
factor of 89.2%.
Figure 2-26: Average seat load factor for the top
25 Holiday/Charter Carriers
Source:
DLR calculations based on Airline Business data
RPK and ASK (Billion)
149,369
136,737
12,632
172,813
158,647
14,166
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
Airlines total Airlines EU Airlines North America
Mill RPK Mill ASK
Loadfactor (%)
89.2
85.7
86.1
0
10
20
30
40
50
60
70
80
90
100
Airlines total Airlines EU Airlines North America
Annual analyses of the European air transport market
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Release: 2.2 Page 65
2.1.3 Passenger Fleet
Table 2-5 shows the development of the world passenger fleet in 2007 compared to 2006. The
world fleet is defined here as all passenger aircraft in commercial use. Only aircraft that were
actually in service at year-end are taken into account. The total number of passenger aircraft
with more than 19 seats in service at year-end 2007 stood at 19,655 - up from 18,688 at year-
end 2006.
Table 2-5: Passenger aircraft in service
at year-end
Source: Ascend Online Fleets
The overall fleet growth of 5.2%
reflects the growth of global air
transport. However, the trend
varies considerably if the different
aircraft size categories are
considered more closely. Smaller types of aircraft used for passenger service in particular show
below average growth. This trend reflects the economics of airline operations, as well as general
market growth. On the one hand, smaller aircraft are usually associated with higher operating
costs per seat, while at the same time market growth means that airlines are increasingly able to
operate larger aircraft in markets that until now had only sustained smaller types of aircraft. The
most rapidly growing market segment is the 170-239-seater segment. Aircraft in this category
include the Boeing 737-800 and 737-900, which are increasingly used by low cost carriers.
Also growing considerably is the segment comprising smaller long-range aircraft with 240 to
349 seats. The number of aircraft in service in the category with more than 349 seats has seen a
drop. This is reflected by the fact that many ageing Boeing 747 jets are being replaced by
smaller, more economical twin-jets such as the Airbus A330 and Boeing 777. However, the
segment comprising very large passenger aircraft can be expected to grow again in future with
the delivery of more Airbus A380s over the coming months and years.
Figure 2-27 depicts the development of the different fleet segments over the past 10 years. In
total, the world passenger aircraft fleet grew by almost 33%. The number of aircraft at the two
ends of the market (very small and very large aircraft) declined by 17.7% and 11.9%
respectively. The strongest growth of 89% was seen in the market for large single-aisle and
small twin-aisle aircraft in the 170 to 239 seats category. The market for medium-sized long-
haul aircraft (240-349 seats) also grew at an above average rate of almost 55%.
Aircraft Size 2007 2006 Percentage
Chan
g
e
20-39 seats 1447 1427 1.4%
40-69 seats
3228
3181 1.5%
70-119 seats
2458
2310 6.4%
120-169 seats
7001
6627 5.6%
170-239 seats
3046
2782 9.5%
240-349 seats
1859
1744 6.6%
350+ seats
616
617 -0.2%
Total
19,655
18,688 5.2%
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Figure 2-27: 10-year development of the world passenger aircraft fleet
Source: Ascend Online Fleets, data as of April 2008
Number of Aircraft
20-39 Seats
40-69 Seats
70-119 Seats
120-169 Seats
170-239 Seats
240-349 Seats
350+ Seats
0
1000
2000
3000
4000
5000
6000
7000
8000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
20-39 Seats 40-69 Seats 70-119 Seats 120-169 Seats 170-239 Seats 240-349 Seats 350+ Seats
Table 2-6: Average age of passenger aircraft in service at year-end
Source: Ascend Online Fleets, data as of April 2008
It is interesting to note that larger aircraft are on average
younger than smaller aircraft. One potential explanation is
that airlines tend to use modern, fuel-efficient aircraft in
the long-haul segment, as the fuel consumption advantage
is higher than with short-haul aircraft.
Aircraft category 2007
20-39 seats
17.97
40-69 seats
12.22
70-119 seats
12.41
120-169 seats
11.19
170-239 seats
9.39
240-349 seats
9.14
350+ seats
12.89
Overall average age 11.59
Annual analyses of the European air transport market
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Table 2-7: The 20 largest network carriers by fleet size at year-end 2007, mainline passenger operations
only
Regional jets
and
turboprops
Small single
aisle jets/
turboprops
Medium
single aisle
jets
Large single
aisle/ small
twin aisle jets
Intermediate
twin aisle jets
Large twin
aisle jets
Pos. Operator Total
fleet
20-69 70-119 120-169 170-239 240-349
350+
1American Airlines
659
0 0 391 187 81 0
2 Delta Air Lines
445
0 0 206 188 51 0
3 United Airlines
404
0 43 160 105 96 0
4 US Airways
360
0 11 261 79 9 0
5 Continental Airlines
356
0 60 192 79 25 0
6 Northwest Airlines
347
0 62 171 64 32 18
7 China Southern
249
6517045194
8Lufthansa
246
0 3089386326
9 Air France
244
0 5105534437
10 British Airways
235
0 9 81 71 53 21
11 China Eastern
210
14 0 150 10 36 0
12 Air China
206
0613524374
13 Air Canada
206
0 57854915 0
14 Japan Airlines Internat.
187
0 0 42 20 82 43
15 Alitalia
144
0 0 98 36 10 0
16 ANA
139
0 5 23 23 56 32
17 Iberia
136
0 8 75 22 19 12
18 Qantas
125
0 0 51 13 36 25
19 SAS
123
4 28611911 0
20 Saudi Arabian Airlines
116
0 15 34 8 36 23
5137
24 344 2577 1133 811 245
26.1%
0.5% 14.0%
36.8%
37.2% 43.6% 39.8%
Total fleet operated by 20
largest operators
Percentage of world fleet:
Aircraft Seat Classes
Source: Ascend Online Fleets, data as of April 2008
American Airlines operates the largest jet fleet in the world. Of the 10 largest network carriers
by fleet size, the top six airlines are located in the US, followed by China Southern and three
European carriers, Lufthansa, Air France and British Airways. The figures given in Table 2-7 only
take into account airline fleets operated by the parent company. Subsidiaries, which are usually
founded or contracted to provide feeder services, are not taken into account. Smaller aircraft are
therefore underrepresented in this table. Interestingly, the 20 largest network carriers in the
world operate more than one quarter of the world’s passenger aircraft. In the larger aircraft
categories (240 seats or more), these 20 carriers have an even higher share with 42.7% of the
world fleet.
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Table 2-8: The 20 largest low cost airlines by fleet size at year-end 2007
Regional jets
and turbo-
props
Small single
aisle jets
Medium
single aisle
jets
Large single
aisle/small
twin aisle jets
Intermediate
twin aisle jets
Pos. Operator
Total
fleet
20-69 70-119 120-169 170-239 240-349
1 Southwest Airlines
518
0 0 518 0 0
2Ryanair
150
0001500
3 easyJet/easyJet Switzerland
137
0 0 137 0 0
4 AirTran Airways
137
087500 0
5 jetBlue
134
0 30 104 0 0
6 Air Berlin
89
0 4 30 55 0
7 GOL Linhas Aereas
78
0 0 42 36 0
8Flybe
73
24 49 0 0 0
9 WestJet
70
013570 0
10 Frontier Airlines
63
311490 0
11 Virgin Blue
53
0 3 24 26 0
12 TUIfly
51
0 0 15 36 0
13 Air Deccan
41
10 8 0 23 0
14 Kingfisher Airlines
39
150177 0
15 Air Asia
39
0 0 9300
16 Spirit Airlines
36
003150
17 Lion Air
31
002380
18 Jetstar
31
0 0 0256
19 Jet2
30
002180
20 Norwegian Air Shuttle
25
002410
1825
52 205 1151 410 6
Percentage of world fleet:
9.3%
1.1% 8.3% 16.4% 13.5% 1.0%
Tota
l
fl
eet operate
d
b
y 20
largest operators
Aircraft Seat Classes
Source: Ascend Online Fleets, data as of April 2008
The list of largest low cost carrier fleets is dominated by Southwest Airlines. Said to be the
inventor of low cost flying, the airline operated 518 aircraft at the end of 2007, all Boeing 737
planes. This, in fact, not only puts them in first place among low cost airline fleets, but would
also gain them second place among all aircraft operators in the world. Second in the list of low
cost fleets is Ryanair with 150 aircraft. Like Southwest, Ryanair operates an all-Boeing 737 fleet,
although the Irish carrier uses the slightly larger -800 model with 189 seats, while Southwest’s
fleet is dominated by the -700 variant with a 137 seat configuration. The top 20 low cost
carriers by fleet size are relatively evenly distributed geographically: 6 carriers are from North
America, 7 from Europe and 7 from Australasia.
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Table 2-9: The 20 largest regional airlines by fleet size at year-end 2007
Regional jets
and
turboprops
Regional jets
and
turboprops
Small single
aisle jets
Pos. Operator
Total
fleet
20-39 40-69 70-119
1 ExpressJet Airlines
271
31 240 0
2 SkyWest Airlines
266
59 125 82
3 American Eagle Airlines
256
64 167 25
4 Atlantic Southeast Airlines
171
0 134 37
5 Pinnacle Airlines
140
0 137 3
6 Air Canada Jazz
135
36 83 16
7Comair
134
2 107 25
8 Mesa Airlines
124
15 71 38
9 Chautauqua Airlines
118
17 101 0
10 Lufthansa Cityline
74
04430
11 Air Wisconsin
69
0690
12 Air Nostrum
66
05016
13 Horizon Air
70
16 54 0
14 Mesaba Airlines
67
49 4 14
15 Regional
62
16 28 18
16 Republic
57
0057
17 KLM Cityhopper
55
01441
18 Piedmont
52
41 11 0
19 PSA Airlines
49
03514
20 Trans States Airlines
48
0480
2284
346 1522 416
11.6%
23.9% 47.1% 16.9%
Percentage of world fleet
Aircraft Seat Classes
Total fleet operated by 20
largest operators
Source: Ascend Online Fleets, data as of April 2008
Nine of the ten largest regional airlines are located in North America. Often these carriers do not
operate under their own brand, but rather offer services to the main network carriers as feeders.
The "outsourcing" of these services results in cost savings for the network airlines, as the
regional airlines often have different labour agreements. Overall, the 20 largest regional airlines
operate 11.6% of the world fleet. The group comprising regional jets and turboprop aircraft
with 40 to 69 seats represents 47.1% of the world fleet.
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Table 2-10: The 10 largest holiday airlines by fleet size at year-end 2007
Medium
single aisle
j
ets
Large single
aisle/small
twin aisle jets
Intermediate
twin aisle jets
Large twin
aisle jets
Pos. Operator
Total
fleet
120-169 170-239 240-349 350+
1 Thomsonfly
41
12 24 5 0
2 Condor
35
013220
3 Monarch Airlines
31
0241 6
4LTU
26
10 4 9 3
5First Choice Airways
23
0176 0
6 Thomas Cook Airlines
20
0162 2
7 Air Transat
16
00124
8 MyTravel Airways
13
0112 0
9 Ryan International
13
4810
10 SunExpress
13
0130 0
231
26 130 60 15
1.2%
0.4% 4.3% 3.2% 2.4%
Total fleet operated by 10
largest operators
Percentage of world fleet:
Aircraft Seat Classes
Source: Ascend Online Fleets, data as of April 2008
The holiday airlines segment is fairly small compared to those following other business models, a
fact which is also reflected in the fleet sizes. In recent years, low cost carriers have entered the
market by flying to holiday destinations, and some carriers formerly clearly committed to the
holiday market have changed their business models to address the low cost market. Looking at
the fleets, it seems that the market for holiday carriers is less concentrated than other segments
of the airline market, as there are plenty of airlines operating between five and ten aircraft.
Holiday/charter airlines seem to be a largely European phenomenon. Of the ten largest
operators, eight carriers are from Europe and only two from North America.
2.1.4 Airline Financial Performance
2.1.4.1 Introduction
Concerning the commercial and financial performance of airlines, 2007 continued an already
very successful year 2006. A large number of airlines in all market segments, both European and
non-European, posted record revenues and profits. Despite an increase in fuel prices, profits
developed strongly due to a high demand environment supported by a healthy worldwide
economic growth, which created a favourable business environment for airlines. It was possible
to pass on fuel price increases to passengers without harming demand growth.
The results of 2007 show healthy profits for most of the major full service network and low cost
carriers.
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2.1.4.2 Fuel Price Development
In recent years, despite ongoing efforts of the industry to introduce new and more fuel efficient
aircraft, fuel has become the single most important cost factor for airlines, just ahead of labour
costs. This is mainly due to the fact that fuel prices have increased considerably over the past
years, while labour costs have stagnated due to concessions unions had to make in the
aftermath of September 11, 2001 and productivity increases. While it is possible in the shorter
and medium term for the airlines to hedge themselves against fuel price spikes, it becomes very
difficult to protect against long-term price increases.
The following figure depicts the development of the jet fuel price over the past ten years from
December 1997 to December 2007 at Rotterdam in US-cents per gallon.
Figure 2-28: Price of jet fuel at Rotterdam in US-cents from 1997 to 2007
Source: US Energy Information Administration
0
50
100
150
200
250
300
De
c
em
b
er 1997
Jun
e
1
998
De
c
e
mb
er 1998
Jun
e
1
999
D
ec
e
mb
er 1999
June
2
000
Decemb
er 2
0
00
June 2001
Decemb
er 2
0
01
June 2002
Decemb
er
2
0
02
June 2003
Decemb
er
2
0
0
3
June 2004
Decemb
e
r
2
0
0
4
June 20
0
5
Decemb
e
r
2
0
0
5
June 20
0
6
December
2
0
0
6
Ju
n
e 20
0
7
December
2
0
0
7
Price in US-cents
Price per gallon of jet fuel at Rotterdam in US-cents
The nominal price rose more than four-fold in the depicted timeframe from 60 to 265 US-cents.
In 2007 alone, the price increased by more than 56% between January and December as shown
in the next figure.
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 72 Release: 2.2
Figure 2-29: Price of jet fuel at Rotterdam in US-cents from January to December 2007
Source: US Energy Information Administration
150
170
190
210
230
250
270
290
Jan
u
ary
F
e
bru
a
ry
Marc
h
April
M
ay
J
u
ne
Ju
ly
Augu
s
t
Septemb
e
r
Octo
b
er
No
vemb
er
De
c
e
mb
er
Price in US-cents
Price per gallon of jet fuel at Rotterdam in US-cents
2.1.4.3 European Network Carriers Financial Results
The following table shows the development of revenues and operating profits for European
network carriers in the year 2007, compared with the same period in 2006. It also includes the
groups’ non-aviation businesses. All non-€-currencies were converted into € using the exchange
rate at the end of the reporting period.
Table 2-11: Revenues and Operating Results of selected European Network Carriers for the fiscal years
2006 and 2007
Source: Quarterly Reports of the respective airlines/airline groups
Pos. Airline group Revenues in million € Operating income in million € fiscal year ending
2007
¹
2006
²
change 2007 2006
1 Air France-KLM Group 23,073 21,448 7.6% 1240 936 31.03.2007
2 Lufthansa Group 22,578 19,831 13.9% 1388 844 31.12.2007
3 British Airways 11,402 10,845 5.1% 808 916 31.03.2007
4 Iberia Group 5561 5383 3.3% 286 122 31.12.2007
5 Alitalia Group 4881 4720 3.4% -313 -466 31.12.2007
6 SAS Group 4297 4382 -2.0% 211 190 31.12.2007
7 THY Turkish Airlines 2775 2159 28.5% 317 46 31.12.2007
8 Austrian Airlines 2569 2609 -1.5% 38 -87 31.12.2007
9 Virgin Atlantic 2565 2527 1.5% 56 55 28.02.2007
10 Finnair 2196 1950 12.6% 143 -11 31.12.2007
11 Aer Lingus 1294 1115 16.1% 89 76 31.12.2007
TOTAL 83,190 76,967 8.10% 4263 2642
¹ 1 USD = 0,6848 € ² 1 USD = 0,7593 €
Annual analyses of the European air transport market
Annual Report 2007
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Release: 2.2 Page 73
European network carriers were able to
increase their revenues for 2007 by 8.1% on
average. Operating profits increased also,
despite rising fuel costs. The net results of
European major network carriers grew
considerably.
Table 2-12: Operating Margins of selected
European Network Carriers
Source: Quarterly Reports of the respective
airlines/airline groups
A more detailed analysis for the fiscal year ended 31
st
March 2007 is shown in the following
figure for the operating expenses of the Air France-KLM group:
Figure 2-30: Operating Expenses of the Air France-KLM Group for the fiscal year ended 31
st
March 2007
Source: Air France-KLM group
Staff Costs
33.8%
Aircraft Fuel
21.5%
Commercial and
Distribution Costs
6.1%
Other
10.8%
Catering
2.1%
Chartering Costs
3.3%
Aircraft Operating Lease
Costs
3.0%
Aircraft Maintenance
4.5%
Handling Charges and
other operating costs
6.2%
Landing Fees and Enroute
Charges
8.6%
2.1.4.4 European Network Carriers Share Price Development
Share prices reflect the market’s expectations for future earnings of publicly traded companies.
Therefore, they are a good indicator for the well-being of the respective enterprises.
The following chart shows the share price development of major European network carriers,
measured in the home currency of the respective carrier and the share price on 1
st
January 2007
indexed to 100. The share price is adjusted for splits and dividends to reflect total performance.
With the exception of Iberia, all major European FSNCs’ shares traded lower at year end in
comparison to the beginning of the year. One explanation for this is the historically negative
Pos. Airline group Operating Margin in %
2007 2006
1 THY Turkish Airlines 11.4 2.1
2 British Airways 7.1 8.4
3 Aer Lingus 6.9 6.8
4 Finnair 6.5 -0.6
5 Lufthansa 6.1 4.3
6 Air France-KLM Group 5.4 4.4
7 Iberia Group 5.1 2.3
8 SAS Group 4.9 4.8
9 Virgin Atlantic 2.2 2.2
10 Austrian Airlines 1.5 -3.3
11 Alitalia Group -6.4 -9.9
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correlation of oil prices and airline shares as the oil price rose considerably in the course of 2007
from less than US-$ 60 to almost US-$ 100. Jet fuel, as a major component of airline operating
costs, therefore has a significant impact on the profitability. Another explanation might be that
the market expects that the airline industry has come close to its peak in the current business
cycle and that future earnings cannot be increased the same way as in the past years.
Figure 2-31: Share price development of major European network carriers in 2007
Source: Historical Stock Quotes on www.yahoo.com, adjusted for splits and dividends
40
60
80
100
120
140
160
January
February
Ma
r
ch
Ap
ri
l
M
ay
Ju
ne
J
ul
y
Augus
t
S
ept
emb
er
Oc
to
b
er
No
vemb
er
Decemb
er
Index 1st Jan 2007 = 100
Air France/KLM Lufthansa British Airways Iberia SAS Alitalia
British Airways experienced the strongest decline in share prices – £100 invested in BA shares on
1
st
January 2007 had a value of only £57.31 on 31
st
December 2007. The high performance of
Iberia can be explained by speculations about a takeover by either financial investors or other
network carriers. Usually, such transactions are associated with a considerable mark-up
compared to the share prices at the stock exchange. € 100 invested in shares of Iberia at the
beginning of the year had a value of € 107.53 at year end, a return of +7.53%. This constitutes
an outperformance of the overall market, which performed +3.47% in 2007, as measured by
the Dow Jones EURO STOXX Index.
2.1.4.5 European Low Cost Carriers Financial Results
According to Table 2-13 two of the largest low cost carriers in Europe, Ryanair and Air Berlin
were able to increase their revenues by 22.4% and 61.0%, respectively, for the year 2007
compared to the preceding year, while easyJet’s revenues increased by 7.6%. Concerning
profits, a differentiated picture must be drawn. While both Ryanair and easyJet continue to
increase profits by double-digit figures, Air Berlin’s profit in fact dropped, which is, however, to
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be explained by the costs associated with the integration of LTU, which was acquired on March
26, 2007.
Table 2-13: Revenues and Operating Results of selected European Low Cost Carriers for the fiscal years
2006 and 2007
Source: Airline Business and Annual Reports of the respective airlines/airline groups
Pos. Airline group Revenues in million € Operating income in million € fiscal year ending
2007¹ 2006²
change 2007 2006
1 Air Berlin 2537 1575 61.0% 21 64 31.12.2007
2 easyJet 2512 2334 7.6% 240 170 30.09.2007
3 Ryanair 2042 1669 22.4% 431 364 31.03.2007
4 Transavia Airlines 625 546 14.4% 31 22 31.03.2007
5 Norwegian Air Shuttle 534 344 55.4% 17 -4 31.12.2007
6 Vueling Airlines 365 235 55.6% -71 -10 31.12.2007
7 GB Airways 343 292 17.2% 6 -1 31.03.2007
8 SkyEurope Airlines 231 176 31.3% -20 -53 30.09.2007
TOTAL 9188 7171 33.1% 654 551
¹ 1 USD = 0.6848 € ² 1 USD = 0.7593 €
Ryanair, whose business year ended on March 31, 2007, increased its revenues from € 1.6
billion to € 2.0 billion, which is an increase of 22.4%. Operating income increased by 18.3%
from € 364 million in 2006 to € 430 million in 2007. The operative profit margin, which is
defined as the proportion of operating income to operating revenues, however, decreased
slightly from 21.8% in 2006 to 21.1% in 2007. With this operating margin, the Irish airline
remains among the most profitable air carriers in the world.
Figure 2-32: Ryanair’s Operating Expenses Structure for the Fiscal Year ended 31
st
March 2007
Source: DLR Analysis based on Ryanair 20F statement
From Ryanair’s 20F-statement,
which the airline has to submit
as its shares are listed at the
New York Stock exchange, a
more detailed analysis of the
cost structures is possible. The
highest share in operating
expenses is fuel and oil with
42.8%, followed by airport and
handling charges with 16.9%
and staff costs with 14.0%.
Due to its relatively young fleet,
maintenance costs are only a
minor factor with 2.6% of total
expenses. Ryanair, which sells
Fuel & Oil
42.8%
Airport and Handling
Charges
16.9%
Staff Costs
14.0%
Route Charges
12.3%
Other
6.5%
Aircraft Rentals
3.6%
Maintenance, Materials
and Repairs
2.6%
Marketing and Distribution
Costs
1.5%
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its tickets exclusively over the internet and call centres, has (compared to traditional airlines)
relatively low costs for marketing and distribution with only 1.5%.
easyJet also reported very favourable financial results of its business year, which ended on 30
September 2007. Passenger revenues increased by 7.6% from € 2.3 billion to € 2.5 billion. At
the same time, operating income rose by 41.6% from € 169.1 million to € 230.4 million. The
operative margin, as measured by the earnings before interest and taxes (EBIT) divided by the
sum of passenger and ancillary revenues was considerably lower than Ryanair’s with 9.6% in
2007. This compares to an operative profit margin of 7.3 % in 2006.
Air Berlin’s business year is identical to the calendar year. The comparison to the same year
2006 is limited, as the financial statements of 2007 reflect the acquisition of LTU, which was
consolidated by 1
st
August 2007. Revenues increased by 61.0% from € 1575.40bn in 2006 to €
2536.50bn. The operating income declined from € 64.1m to € 21.4m, a fall of 66.6%. This
however, is associated to a large extent with the costs for the integration of LTU. The operative
result, as measured by the EBITDAR increased from € 256.5m from 2006 to € 379.0m in 2007.
Unlike easyJet and Ryanair, Air Berlin is engaged to a large extent in the charter business and
sells large quantities of seats directly to tour operators. This segment accounts for almost 35%
of the groups’ revenues.
2.1.4.6 European Low Cost Carriers Share Price Development
Figure 2-33: Share price development of major European low cost carriers in 2007
Source: Historical Stock Quotes on www.yahoo.com, adjusted for splits and dividends
0
20
40
60
80
100
120
140
160
180
200
220
Ja
n
ua
ry
F
e
b
ru
ar
y
M
arch
April
M
a
y
June
July
Au
g
u
s
t
September
Octo
b
er
N
ovember
December
Index 1st Jan 2007 = 100
easyJet Ryanair Air Berlin SkyEurope Vueling
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Figure 2-33 depicts the development of share prices for major European low cost carriers.
Compared to the share price development of full service carriers, the low cost carriers show a
higher volatility. For instance, the share price of SkyEurope doubled within one month from the
beginning of the year, but fell from its peak by about two thirds by year end. Worst performer
among the group of publicly listed low cost carriers is the Spanish Vueling. € 100 invested in the
company in January 2007 had a value of only € 27.20 at the end of the year. The three largest
European low cost carriers experienced a decline in their share price: easyJet dropped by 3.7%,
Ryanair by 11.3% and Air Berlin by 28.9%.
2.1.5 Alliances
Airline alliances comprise a multitude of marketing instruments, such as code sharing, blocked
space agreements or joint frequent flyer programs up to deep integration of different airlines
along the value chain in strategic alliances. In many cases, airlines committed to strategic
alliances also conclude code-sharing agreements with partners who are not members of their
own alliance.
The foundations of two airline alliances were first laid in 1987: Northwest and KLM formed a
cooperation which resulted in 1998 in the Wings alliance with Continental, Air France and
Alitalia, while Delta Airlines, Singapore Airlines and Swissair founded Global Excellence. The
beginning of the Star Alliance goes back to 1993 when Lufthansa and Varig formed a bilateral
cooperation. Star Alliance was then finally founded in 1997 by Lufthansa, United Airlines,
Scandinavian Airlines, Air Canada and Thai. First signs of oneworld go back to 1996 with British
Airways and American Airlines cooperating on flights between Europe and the USA. Together
with Cathay Pacific, Qantas and Canadian Airlines, the oneworld alliance was formed in 1998.
The now defunct Qualiflyer and Atlantic Excellence alliances were founded in 1998 by several
airlines. SkyTeam was formed in 2000 by Air France, Delta Air Lines, Aeromexico and Korean.
In 1995, there were around 300 airline cooperation agreements worldwide. Their number
increased steadily to 502 in 1998. In 2000, their number finally reached 580, from which the
global strategic airline alliances emerged. Since then, the Wings, Qualiflyer, Atlantic Excellence
and Global Excellence alliances have been dissolved. Today, only three global airline alliances
remain: Star Alliance, oneworld and SkyTeam. In many cases, members of the dissolved alliances
joined one of the remaining three. Figure 2-34 displays the relationships between major airlines
and the global strategic airline alliances. The figure only includes full members, whereas regional
partners and associated members are not considered in the analysis to follow. Among the three
alliances, Star Alliance is the biggest in terms of the number of members. It was formed by 17
airlines in 2007. Varig left the Star Alliance in 2007 (but is still included in the analysis to follow).
Potential new members are Air China, Shanghai Airlines and Turkish Airlines. SkyTeam consists
of 11 members, with China Southern joining the alliance in 2007 (although it is not included in
the analysis to follow). The oneworld alliance comprises ten airlines in 2007. Japan Airlines,
Malev and Royal Jordanian joined oneworld in 2007 (although they are not included in the
analysis to follow), while Aer Lingus left the alliance. Aer Lingus now operates in the low cost
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segment. There are a number of airlines which do not belong to any alliance; these are
essentially low cost carriers such as easyJet or Air Berlin and big FSNCs, with Emirates being the
most prominent full service carrier not belonging to any airline alliance. Recently, a number of
airlines from Asia (especially from China) joined one of the three airline alliances.
Figure 2-34: Airline alliances 2007
Source: OAG 2007, DLR
Airline Alliances
Star Alliance:
Air Canada (AC)
Air New Zealand (NZ)
ANA (NH)
Austrian (OS)
Asiana Airlines (OZ)
bmi (BD)
LOT Polish Airlines (LO)
Lufthansa (LH)
Scandinavian Airlines (SK)
Singapore Airlines (SQ)
Spanair (JK)
TAP Portugal (TP)
Thai Airways (TG)
United (UA)
US Airways (US)
South African (SA)
Swiss (LX)
2007 Exit: Varig (RG)
2007
Skyteam:
Air France (AF)
Delta Airlines (DL)
Korean (KE)
Aeromexico (AM)
KLM (KL)
Northwest (NW)
Continental (CO
Alitalia (AZ)
Czech Airlines (OK)
Aeroflot (SU)
2007 New Entry: China Southern (CZ)
Oneworld
:
British Airways (BA)
American Airlines (AA)
Finnair (AY)
Iberia (IB)
LAN Chile (LA)
Qantas (QF)
Cathay Pacific (CX)
2007 New Entry: Japan Airlines (JL)
Malev (MA)
Royal Jordanien (RJ)
2007 Exit: Aer Lingus (EI)
Skyteam
AF
KE
AM
DL
NW
KL
CO
AZ
OK
SU
CZ
Oneworld
QF
CX
IB
AY
AA
LA
BA
EI
JL
MA
RJ
Star
Alliance
BD
OS
LH
NZ
TG
UA
AC
SQ
SK
OZ
US
LO
TP
OS
NH
LX
SA
RG
JK
Non-Alliance Airlines
Low Cost Carriers:
Southwest (WN)
Easyjet (U2)
JetBlue (B6)
Ryanair (FR)
Air Berlin (AB)
Full Service Carriers:
Emirates (EK)
Malaysia Airlines (MH)
Amerikan West (HP)
Virgin (VS)
EK
MH
VS
WN
HP
FR
B6
U2
AB
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Table 2-13: 2007 International Scheduled Traffic by Alliance
Source: IATA 2008
Number
Y-o-Y %
Change
Number
Y-o-Y %
Change
Number
Y-o-Y %
Change
Kilometers Flown (thousands)
2,646,103 2.2 3,051,611 5.3 4,032,826 8.0
Aircraft Departures
921,680 -0.7
1,182,483
4.0 1,759,305 6.1
Hours Flown
3,703,267 1.9
4,422,879
5.7 5,834,977 6.3
Passengers Carried
118,828,539 2.7
130,983,637
5.7 188,719,802 7.5
Passenger-Kilometres Flown (thousands)
473,699,005 2.7
493,627,993
6.9 652,999,567 6.6
Available Seat-Kilometres (thousands)
608,762,182 1.3
625,129,417
6.7 831,493,523 5.4
Passenger Load Factor
77.8%
79.0%
78.5%
Tonne-Kilometres Performed (thousands)
70,204,345 3.3
75,220,132
5.3 99,447,289 7.2
Available Tonne-Kilometres (thousands)
105,736,536 3.3
106,571,602
4.6 140,949,634 1.0
Employees
450,512
601,254
706,426
oneworld SkyTeam Star Alliance
Table 2-13 shows important performance metrics for the three major global airline alliances
oneworld, SkyTeam and Star Alliance. The number of passenger-kilometres flown has increased
for all three alliances by between 2.7% and 6.9% in 2007 compared to 2006. Star Alliance
remains the largest airline alliance, not only in terms of member airlines, but also by the number
of employees and its transport performance. Despite the exit of Varig and no new airline joining
in 2007, Star Alliance had the highest growth rates in terms of passenger-kilometres flown and
tonne-kilometres performed among the three alliances. More than 700,000 employees work for
the Star Alliance airlines. In total, more than 1.7 million employees work for the airlines in the
three major alliances.
The Star Alliance's market share, measured by passenger-kilometres, among all IATA carriers has
reached 27.7%, followed by SkyTeam with 23.9% and oneworld with 19.6%. Still, 28.8% of
IATA carriers' passenger kilometres are flown by non-aligned airlines. It can be expected that this
number will further decline, as global airline alliances increasingly attract airlines which so far
have not joined any alliance. This is particularly the case for emerging markets like China and
India, but also airlines from Mexico, Russia and Turkey have already declared their plans to
become members of a major global alliance. The largest airlines measured by passenger
kilometres among the group of non-aligned airlines are Emirates, China Eastern Airlines and
Virgin Atlantic Airways.
Figure 2-35 shows the weekly seat capacity of airlines belonging to the Star Alliance from
European airports. Lufthansa has by far the highest number of seats available in 2007, which
sum up to more than 1 400 000 per week on 13 000 flights, followed by SAS with 600 000
weekly seats on 5 000 flights in the analysed reference week in 2007.
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Figure 2-35: Number of weekly seats available of Star Alliance airlines in 2007
Source: OAG 2007
N
um
b
er o
f
seats ava
il
a
bl
e
(
wee
kl
y
)
0
200.000
400.000
600.000
800.000
1.000.000
1.200.000
1.400.000
1.600.000
Lufthan
sa
G
erma
n
Airl
in
es
SAS Scand
i
navian A
i
rlines
Span
ai
r
Sw
is
s
Au
stri
a
n
T
AP
Ai
r
Portu
gal
bmi
bri
tis
h m
i
d
land
L
O
T
-
Po
lish
A
i
rl
in
es
U
n
ited Airlines
Ai
r
Canad
a
U
S Airways
Sing
a
p
o
re Ai
rl
ines
Th
a
i
Ai
rw
ay
s In
ternatio
nal
Sout
h
Afri
c
an Airways
All
Ni
pp
on
Airw
ays
Air New Zealand
V
AR
IG
Asi
ana A
i
rli
n
e
s
Air France is the leading member in the SkyTeam alliance in terms of seats available in 2007 as
illustrated by Figure 2-36. Air France offered nearly 1.3 million seats on the observed 11 000
weekly flights in 2007, followed by Alitalia with a good 600 000 seats on 5 000 flights.
Figure 2-36: Number of weekly seats available of SkyTeam alliance airlines in 2007
Source: OAG 2007
N
um
b
er o
f
sea
t
s ava
il
a
bl
e
(
wee
kl
y
)
0
200.000
400.000
600.000
800.000
1.000.000
1.200.000
1.400.000
Air France Alitalia KLM-Royal
Dutch
Airlines
Aeroflot
Russian
Airlines
Czech
Airlines
Delta Air
Lines
Continental
Airlines
Northwest
Airlines
Korean Air Aeromexico
Annual analyses of the European air transport market
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Figure 2-37 shows the number of seats available in 2007 for the members of oneworld. The two
major airlines in terms of seat capacity are British Airways and Iberia with 870 000 seats on just
6 000 flights and 800 000 seats on just over 7 000 flights respectively.
Figure 2-37: Number of weekly seats available of oneworld alliance airlines in 2007
Source: OAG 2007
Number of seats available (weekly)
0
100.000
200.000
300.000
400.000
500.000
600.000
700.000
800.000
900.000
1.000.000
British Airways Iberia Finnair American Airlines Cathay Pacific
Airways
Qantas Airways Lan Airlines
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Figure 2-38 shows the number of seats available per week in 2007 for the 20 largest non-
alliance full service network carriers, of which Turkish airlines is the biggest with more than half
a million seats offered on 3 200 weekly flights in 2007.
Figure 2-38: Number of weekly seats available of non-alliance FSNCs in 2007
Source: OAG 2007
Number of seats available (weekly)
0
100.000
200.000
300.000
400.000
500.000
600.000
Turki
s
h A
i
rli
n
es
Aer
L
i
n
gu
s
A
ir Eu
ro
pa
A
i
r
O
ne
O
ly
mp
ic Ai
rl
in
es
SN
B
russ
el
s
Ai
rli
n
e
s
Aegean Airlines
Si
beri
a
Airl
i
nes
MALEV
Hun
g
arian Airlines
Pul
kovo A
v
i
ati
on Enterpri
s
e
UTair
Av
i
at
ion
Emirates
Vi
rg
in
Atlan
ti
c Airwa
y
s
Croati
a
Airl
i
nes
A
i
r
M
alta
Icela
n
dair
Cyprus Airways
R
o
yal Ai
r
Maro
c
Tarom
Aerosvit Airlines
Figures 2-39 and 2-40 illustrate the shares of the four carrier categories described earlier in this
study at major hub and international airports in Europe. Full service network carriers are
differentiated as to whether they belong to one of the four airline alliances (and which of these)
or not. Typical hub airports like Frankfurt/Main, Amsterdam, Paris Charles de Gaulle, London
Heathrow, Madrid and Zürich are mainly dominated by FSNCs which belong to one of the airline
alliances. The major alliance at such an airport typically accounts for between 50% and 75% of
the seat capacity offered, as illustrated by Figure 2-40. However, London Heathrow is an
exception to the rule as both Star Alliance and oneworld have a considerable market share.
Furthermore, 200,000 weekly seats are from full service network carriers belonging to no airline
alliance. Nevertheless, oneworld carriers have the highest share of departures at London
Heathrow, accounting for nearly 50% of the total number of seats available. Madrid is similar to
London Heathrow, with oneworld being the major alliance at the airport, but both Star Alliance
and non-alliance full service network carriers are together responsible for more than 200,000
seats per week. London Gatwick has both a high share of FSNCs and low cost traffic, although it
is much smaller in terms of the seats available compared to the major hub airports mentioned
before. oneworld is the major airline alliance operating at London Gatwick. Cologne/Bonn
airport is an example of an international airport with extensive low cost traffic. The main alliance
Annual analyses of the European air transport market
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operating at Cologne/Bonn is Star Alliance, however, about two thirds of the total offered seat
capacity is made up of low cost traffic.
Figure 2-39: Airline alliances at major European airports
Source: OAG 2007
Number of seats available (weekly)
0
100.000
200.000
300.000
400.000
500.000
600.000
FRA AMS CDG LHR LGW MAD ZRH CGN
StarAlliance Oneworld Skyteam Other FSNC Charter Regional Carrier Low Cost Carrier
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Figure 2-40: Market share of airline alliances at major European airports in detail
Source: OAG 2007
Frankfurt Airport
71%
4%
4%
12%
5%
0%
4%
Amsterdam Airport
8%
4%
58%
10%
4%
1%
15%
Paris-CDG Airport
9%
4%
62%
15%
8%
1%
1%
London-Heathrow Airport
23%
49%
5%
22%
0%
0%
1%
London-Gatwick Airport
2%
33%
5%
10%
19%
1%
30%
Madrid Airport
18%
48%
13%
0%
1%
14%
6%
Cologne / Bonn Airport
15%
2%
3%
5%
1%
0%
74%
StarAlliance
Oneworld
Skyteam
Other FSNC
Charter
Regional Carrier
Low Cost Carrier
Zurich Airport
68%
6%
6%
8%
9%
2%
1%
Annual analyses of the European air transport market
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Release: 2.2 Page 85
2.1.6 Competition
Figure 2-41 shows the share of flights departing from European airports in 2007 per week
which were offered in total including code share arrangements and those that were actually
operated by an airline. Altogether, 255 000 flights were offered per week in 2007, whereas only
161 000 were actually operated. Therefore, 37% of the flights offered per week in 2007 were
code sharing flights.
Figure 2-41: Share of flights offered, including code
share flights and actually operated in 2007
Source: OAG 2007
Figure 2-42 ranks airlines according to the
number of their code sharing partners in
Europe. The top three airlines are Austrian, Air
France and Lufthansa with 38, 31 and 29 code
sharing partners respectively. The number of code sharing partners declines slowly with Tarom
having the smallest number of code sharing partners, that being eight partners. As Figure 2-43
illustrates, the number of code sharing partners does not depend on airline size. For example,
Lufthansa has 29 partners, whereas British Airways has only ten partners. On the other hand,
Austrian and LOT Polish Airlines have 38 and 24 code sharing partners respectively.
Figure 2-42: Ranking of airlines according to the number of code sharing partners in Europe
Source: OAG 2007
Number of CS-Partner
0
5
10
15
20
25
30
35
40
Austrian
Ai
r
Fr
an
c
e
Lufthan
sa
G
erman
Ai
rl
in
es
L
OT -
Po
lis
h
Ai
rli
nes
bmi bri
ti
sh mid
l
and
Alitalia
M
A
LEV
Hu
ng
arian
Ai
r
l
i
nes
C
zec
h
A
i
rl
in
es
Aeroflot Russian Airlines
I
beri
a
Swiss
SAS
Sc
an
di
navian
Air
li
nes
TAP Air Portugal
K
L
M
-R
oy
al
Dutch
Ai
rl
in
es
Finnair
Turkish Airlines
Ae
r
osvit Airl
in
es
A
i
r
O
ne
Uk
rai
ne Intern
a
t
i
onal
Ai
r
lines
SN Bruss
el
s Airlines
Sp
anai
r
Bri
tis
h
Ai
rways
Ai
r
B
altic
Co
rporati
o
n
Ad
ria Airw
ay
s
United Airlines
A
meri
c
an Airl
i
nes
Air
Can
ada
Cy
p
rus Airways
Croatia Airl
i
nes
Tarom
Closely related with airline alliances is the number of carriers operating on specific routes. Figure
2-43 displays the routes with the highest number of carriers. The number of carriers operating
63%
37%
Operating Carrier Non Operating - Code sharing Partner
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on a route is an indicator of the degree of competition. The route Milan Malpensa – Rome
Fiumicino is served by nine different carriers, followed by Adler/Sochi – Moscow Vnukovo and
Alicante – Manchester International with seven and six different carriers respectively. The high
number of different carriers on certain routes is mainly a result of low cost operations.
Figure 2-43: Top routes in Europe in terms of the number of carriers operating
Source: OAG 2007
Number of Carriers
0
1
2
3
4
5
6
7
8
9
10
Mil
an
Malp
en
sa A
p
t
-
R
ome Fi
u
m
i
ci
n
o
A
pt
A
d
l
er
/Soch
i
-
Mo
sc
o
w Vn
u
ko
v
o
I
nternation
al
A
pt
Alica
n
te - Manchester
I
nternational Apt
C
at
an
i
a
-
Mil
an
L
i
n
at
e
Ap
t
Cologne/Bonn K.A. Apt - Palma Mallorca
Dusseldo
r
f Internat
i
onal Airpo
r
t - Palma Mallorca
Frankfurt International Apt - Thessaloniki
I
b
iz
a -
L
o
n
do
n
Gat
w
i
c
k A
p
t
Lanzarote - F
u
er
t
ev
e
ntura
Man
c
h
e
s
t
er
In
t
ernat
io
n
a
l A
p
t
-
Pal
ma Mall
o
rca
Pale
r
mo
-
M
i
lan
L
inate Apt
A
l
ic
a
n
te -
L
o
n
do
n
Gat
wic
k A
p
t
A
nta
ly
a - Mu
n
i
ch
I
n
t
ernati
o
n
al
A
i
r
p
o
r
t
Barcelona Apt
-
Palma Mal
lo
r
c
a
B
ar
i - Mil
an
L
in
at
e A
p
t
Bir
m
in
g
ham Inter
n
at
i
o
n
al A
i
r
p
o
r
t -
Pal
m
a
Mal
lo
r
c
a
D
u
blin - Sha
n
non
Du
s
sel
d
orf Internatio
n
al Air
p
ort -
Hera
k
lio
n
Far
o
- London
G
a
twic
k
Ap
t
F
ar
o
-
Manchester
In
t
e
rn
at
iona
l A
pt
F
rankfurt
I
nte
r
n
a
tional Apt - Palma
Mal
lo
r
ca
Glasgow Internat
i
onal Airport - Palma M
al
lorca
H
am
b
u
r
g
A
i
rpo
rt
- Palm
a Mall
o
r
c
a
Ib
i
z
a - Mad
r
id
B
ar
aj
as
A
pt
Ib
i
z
a
-
Ma
nc
h
este
r In
t
er
n
at
io
nal A
p
t
In order to give an indication of competition
among carriers in the European network,
Figure 2-44 shows the share of routes
served by only one or by competing carriers.
About 85% of the routes in Europe are
served by only one carrier and a share of
12% by two carriers, thus only 3% of the
routes in Europe are served by three carriers
or more. In fact, Milan Malpensa – Rome
Fiumicino and Adler/Sochi – Moscow
Vnukovo are the only routes served by nine
and seven carriers respectively.
Figure 2-44: Number of routes with one or more
carriers in 2007
Source: OAG 2007
341
31
9,585
1,266
90
9
1
1
1
10
100
1,000
10,000
123456789
No. of Carriers
No. of Routes
Annual analyses of the European air transport market
Annual Report 2007
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Figure 2-45 describes the number of new routes against the number of routes closed per
country in 2007.
Figure 2-45: Market entry / market exit in 2007
Source: OAG 2007
Number of Routes
0
50
100
150
200
250
300
350
400
Uni
ted
K
in
g
do
m
G
erma
n
y
Spai
n
Italy
France
Greece
Turkey
Norwa
y
Po
lan
d
I
r
el
an
d Republic
o
f
Aus
t
ri
a
Sw
ed
en
Switzer
l
and
Netherlan
d
s
Romania
Den
m
ark
Portugal
Bulgaria
Cz
ec
h Rep
u
bli
c
Bel
g
iu
m
Croatia
F
i
nlan
d
Ice
l
and
L
atvia
Hu
ng
ary
New Routes Closed Routes
In most cases, there is a net increase in the number of routes, with Romania being the only
exception with more routes closed than new ones opened. However, this occurs on a very low
level of 30 to 40 routes opened or closed in 2007 respectively. In Finland, the number of routes
opened equals the number of routes closed in 2007. Altogether, changes in the number of
routes are positively correlated with country size. The largest gross changes occur in networks of
the UK, Germany, Spain, Italy and France (descending order). The networks of the UK and Spain
show the largest net changes with a net increase of 202 and 178 routes respectively. The UK
network exhibits the largest gross increase as well with 376 new routes. For the majority of
countries, gross network changes lie below 100 routes opened and closed, which results in net
changes ranging from a four to 39 increase or decrease in the number of routes.
Figure 2-46 displays the number of new low cost routes against those closed in 2007 per
country. In most cases, there is a net increase in the number of routes, with the networks of
Romania and the Netherlands being the only exceptions with more routes closed than new ones
opened. However, this occurs on a very low level of 20 to 30 routes opened or closed in 2007.
Altogether, changes in the number of routes are again strongly correlated with country size. The
evolution of low cost routes is clearly more dynamic and upward than for the entire set of
Annual analyses of the European air transport market
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2008-12-02 Annual Report 2007
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routes, as a comparison of the Figures 2-45 and 2-46 reveals. The largest gross changes of
networks occur in Germany, Spain, Italy, the UK and France (descending order). Networks in
Germany and Spain show the largest net changes with a net increase of 242 and 204 routes
respectively. Germany also exhibits the largest gross network growth as well with 317 new
routes, whereas Italy shows the largest gross decrease with 85 routes closed in 2007. For the
majority of countries, gross network changes lie below 100 routes opened and closed, which
results in net changes ranging from a one to 55 increase or decrease in the number of routes.
Figure 2-46: Market entry and market exit of low-cost carrier routes in 2007
Source: OAG 2007
Number of Routes
0
50
100
150
200
250
300
350
Germany
Spa
i
n
It
al
y
U
n
i
ted
K
i
n
gd
om
F
r
ance
Greec
e
Po
land
Ireland Repu
b
lic of
Aus
tri
a
S
witzerland
Swe
d
en
No
r
way
Po
r
t
u
gal
Romania
Turkey
R
u
ss
i
an
F
ed
e
rati
o
n
Cz
ech
R
e
p
ub
l
ic
Ne
th
erl
and
s
D
en
ma
rk
C
ro
atia
L
atvia
B
u
lg
a
ri
a
Hun
gary
Iceland
B
el
giu
m
New Routes Closed Routes
The following tables show the market entries and exits of air carriers in Member States of the
EU-27. Mostly smaller, low cost-oriented carriers ceased operations and four airlines continued
operations under new ownership and/or as a rebranded carrier. BA Connect was sold by British
Airways to competing carrier Flybe. With this step, British Airways has mostly withdrawn from
the market for regional operations in the UK, with the exception of BA Cityflyer, which was
founded to continue the operations from London City Airport within the BA group. The TUI
Group decided in 2007 to rebrand and consolidate its airline operations, which were formerly
operated as charter carrier HapagFly and low cost carrier HLX into a single airline and rebranded
it as TUIfly. Virgin Express, based in Belgium, merged with SN Brussels Airlines. The merged
company was subsequently rebranded as Brussels Airlines.
Besides several smaller airline start-ups in 2007, the biggest start-up is AeroLogic. Founded as a
joint venture between DHL and Lufthansa Cargo, the airline will be based at Leipzig-Halle
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Release: 2.2 Page 89
airport, which will become the hub of the integrator DHL Express. The airline has ordered 11
Boeing 777 freighters. Ranked by the cargo capacity of its fleet, it is likely that it will be among
the 30 largest cargo airlines by 2012 when all ordered aircraft have been delivered. The carrier
will operate for the integrator DHL Express during weekdays on services to Asia and on
weekends for Lufthansa Cargo to destinations in Asia and America.
Table 2-14: Market entries of carriers in EU-27 during 2007
Source: Ascend
Airline Country Remarks
AeroLogic Germany Joint Venture between DHL and Lufthansa Cargo, to start operations at Leipzig/Halle
with B777F in 2009
Air Bee Italy Low Cost Carrier operating domestic flights in Italy
Air Italy Polska Poland Charter Airline as part of the Air Italy Group, operates 2 B757-200 from Warsaw for
Polish tour o
p
erators
Air Sylhet United Kingdom New operator intending to fly between UK and Bangladesh
Amsterdam Airlines Netherlands New operator intending to operate from Amsterdam and Maastricht with A320
aircraft
Austrojet Austria New operator flying between Salzburg and Banja Luka in Bosnia and Herzegovina
BA Cityflyer United Kingdom Subsidiary of British Airways operating Avro Regional Jets from London City
Blue City Aviation United Kingdom Plan to start regional cargo services from Coventry
Brussels Airlines Belgium Merged/Rebranded operations of SN Brussels/Virgin Express
Cargo B Airlines Belgium Cargo airline based at Brussels operating two leased B747 freighters
City Star Executive United Kingdom Plan to start all-business-class service from Aberdeen to Houston
Estonian Air Regional Estonia Regional subsidiary of Estonian Air, operating two Saab 340
Eurociel France Plan to launch domestic and European services from Nimes and Lyon with Boeing
737 aircraft
Eurotigair Hungary Planned new low cost airline
Fly Excellent Sweden Swedish wet lease operator with two MD-83
FlyEm United Kingdom Planned new low cost airline based at Doncaster/Sheffield
Flyforbeans United Kingdom Planned new low cost airline based at Cardiff
FlyU Ireland Planned to start international scheduled passenger services in 2007 from Waterford
to destinations across Euro
p
e.
Flywhoosh United Kingdom Carrier serving Belfast, Birmingham and Dundee, ceased operations after only 7
months
GainJet Aviation S.A. Greece Operator offering VIP charters with an MD-83 and Gulfstream G200
Gulfwings Air Cargo Italy Cargo services to Johannesburg, Kinshasa, Liegi, Nairobi, Ouagadougou and
Sara
g
ozza, o
p
erated b
y
Gir
j
et
Janes Aviation United Kingdom Cargo operator based at Southend, operating two HS748 aircraft
Jetstream Express United Kingdom Operator based at Blackpool, ceased operations after only one month
Kalmarflyg Sweden Operator providing services between Kalmar and Stockholm-Bromma
Lusitania Airways Portugal Plan to start international charter passenger services from Lisbon
Mistral Air / Air Vatican Italy Airline to provide charter services to pilgrim destinations from Rome
OCA International Germany Airline for cargo ad-hoc charters based at Berlin-Schönefeld
Orbest Portugal Charter airline operating from Lisbon to tourist destinations with an A330
Premjet United Kingdom Airline intending to offer premium services between UK and Spain from 2009
Pronair Spain Wetlease operator flying one B747-200 freighter, an MD-87 and a Cessna Citation
TAER Andalus Spain Operator based at Cordoba, offering mainly domestic flights
TUIfly Germany Merged/Rebranded operations of Hapagfly and HLX
World International Airlines Netherlands Planning to start operations with a Tristar in 2008
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Table 2-15: Market exits of carriers in EU-27 during 2007
Source: Ascend
Airline Country Formed Ceased Operations Remarks
Air Adriatic Croatia 2000 15 March 2007 Market Exit
Air Asturias Spain 2005 25 January 2007 Market Exit
Amber Air Lithuania 2004 15 July 2007 Market Exit
BA Connect United Kingdom 2002 15 April 2007 Takeover of operations by Flybe
Bright Aviation Services Bulgaria 2001 25 June 2007 Market Exit
European Air Express Germany 1999 30 September 2007 Market Exit
Flyjet United Kingdom 2003 15 October 2007 Market Exit
FlyMe Sweden 2004 15 February 2007 Market Exit
Flywhoosh United Kingdom 2007 07 December 2007 Market Exit
HapagFly Germany 1972 01 April 2007 Rebranding into TUIfly
Hapag-Lloyd Express Germany 2002 01 April 2007 Rebranding into TUIfly
Jetstream Express United Kingdom 2007 30 June 2007 Market Exit
MagicBird Airlines Netherlands 2006 15 August 2007 Market Exit
Slovak Airlines Slovakia 1998 15 February 2007 Market Exit
Virgin Express Belgium 1991 15 March 2007 Merged with SN Brussels/Rebranding into Brussels Airlines
2.1.7 Public Service Obligations – PSO
In order to maintain appropriate scheduled air services on routes which are vital for the
economic development of the region they serve, EU Member States may impose public service
obligations (PSO) on these routes involving a peripheral or development region. Therefore, they
must respect the conditions and the requirements set out in Article 4 of Regulation (EC)
2408/92. If no air carrier is interested in operating the restricted routes, the EU Member State
can restrict the access to the route to one single carrier and compensate its losses. Because of
this market interference and for transparency, all impositions and modifications have to be
published in the Official Journal of the European Union. An updated PSO inventory table of all
routes in the EU on which PSOs have been imposed with the corresponding references in the
Official Journal and on-going tender procedures is available
3
.
Table 2-16: PSO routes per country 2007
Source: DG TREN
The following text will only concentrate on
the quantitative changes or effects which
took place in 2007. Table 2-16 gives an
overview of the status as of December 2007.
The number of countries did not change;
they are the same 10 countries as in
December 2006. The overall number of
routes decreased by 4.7% - in most cases,
3
http://ec.europa.eu/transport/air_portal/internal_market/doc/pso_web_111207.pdf
2006
2007
Finland 3
4
France 83
73
Germany 9
3
Greece 25
25
Ireland 7
7
Italy 31
31
Portugal 27
27
Spain 16
16
Sweden 11
11
United Kingdom 22
26
Total 234
223
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Release: 2.2 Page 91
PSOs were lifted on routes where no air carrier responded to the call for tenders and hence
where no air services were being operated - mainly caused by a decrease of 6 out of 9 flights in
Germany and a decrease of 10 routes in France. In contrast there is an increase of 4 further PSO
services in the UK, an increase of 18%. Most of the PSO services are domestic routes, but
21.5% of all French services are international. All these international routes are from regional
airports in France to international hub airports.
A further 12 of the domestic French routes are services within or into the French overseas
regions, the Dom-Tom regions France d’outre-mer. The focus of the other routes is on one hand
those to Corsica, on the other hand linking regional airports to the capital. The Italian routes
concentrate on those to Sardinia and Sicily; comparable to the Greek services which also mainly
link the islands to the main land and some inter-island routes. For Portugal most services
concentrate on the Azores and the Spanish services include only island services either between
the Balearics or between the Canary Islands. Also in the UK most services operate to or from the
Orkney, Shetland and Hebridean Islands. So it can be generalized that most PSO services
concentrate on regions otherwise difficult to access; only in France and in Ireland are there some
more services where at least competition with surface transport modes is possible.
Concerning airlines serving PSO routes, it can be stated that in most cases these services are
provided by regional airlines. Interestingly, these airlines usually cooperate with the respective
national carrier, which in many cases is not optimally suited for these services, due to a higher
cost base. The most important exception is the Greek island services being completely provided
by Olympic Airlines. Though it is required that the tender has to be open for all European
airlines, in most cases only carriers of the same country were able to provide such a service. The
reason might be that it is too cost-intensive for a rather small carrier to start a service outside its
own existing catchment area. Exceptions are the international services to and from Strasbourg,
where airlines from another country were able to win the contract.
2.1.8 Fare Development
An important indicator for the description of the air transport industry’s development is the level
of the fares and yields. It can be assumed that with increasing competition on a particular route
air fares decline. It is, however, very difficult to obtain appropriate data about ticket prices and
yields. The International Air Transport Association (IATA) published detailed fare and yield data
in 2007 for the first time. In the following paragraphs, the most important developments in
Europe are provided. The IATA fare data show only the development in the first half of 2007
(January to June). The growth rates displayed refer to the first half of 2006.
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Figure 2-47: Appraisal of ticket fares per kilometre according to stage distance (Economy class)
Source: IATA Faretracker
0.00
0.20
0.40
0.60
0 1000 2000 3000 4000 5000 6000
Stage Distance (km)
USD per kilometre
Europe
Middle East
Central America
Asia
Southwest
Pacific
Africa
South America
North America
Segment:
ECONOMY
Figure 2-48: Appraisal of ticket fares per kilometre according to stage distance (Premium class)
Source: IATA Faretracker
0.00
0.20
0.40
0.60
0.80
0 1000 2000 3000 4000 5000 6000
Stage Distance (km)
USD per kilometre
Europe
Middle East
Central America
Asia
Southwest
Pacific
Africa
South America
North America
Segment:
PREMIUM
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When comparing route-specific ticket prices of individual world regions, decreasing yields
(measured in US$ per kilometre) for increasing distances become obvious. Thus, in the region
Central America, short distance flight tickets for the economy class show relatively high route-
dependent prices. However, these distance-dependent prices considerably decrease according to
increasing route distance. In other world regions like Asia, Africa or South West Pacific, route-
specific prices are also lower for short distances, although they do not decrease very fast. In
Europe too, above average ticket prices per kilometre for shorter distances can be observed.
However, these prices drop with increasing route distance – more than in other regions – to a
below average level. With respect to route-specific premium-class yields for short distances
Europe is number one. Also for this, segment prices considerably decrease according to
increasing route distance. Nevertheless, they stay relatively high compared to the specific ticket
prices of other world regions.
Fare Development on a Global Scale
On a global scale, ticket prices increased by approx. 0.5% for economy class on average,
compared to the first half of 2006. However, the changes in price are effected rather differently
with respect to the individual world regions and flight corridors: Thus, prices increased by
approx. 15.6% in the region Southwest Pacific, whereas they dropped by approx. 13.1% in the
region South America in the same time frame. A considerable price increase was also seen in the
region Central America (approx. 14.4%), on the South Pacific route (approx. 9.4%) and also on
the North Atlantic route (approx. 7.1%). Dropping average prices for economy class were noted
on the Pacific corridor America - Asia (approx. minus 11%), between Africa and Middle East
(minus 6.4%) and within North America (minus 6.2%). All in all it is worth mentioning that
ticket prices for premium classes (business and first class) reveal similar tendencies – they are
partly even more volatile. Thus, premium class ticket prices dropped by approx. 16.3% within
the region South America, whereas they increased by 20.5% on the South Pacific route.
Fare Development between Europe and other World Regions
When considering the air fare trends with respect to passenger flows between Europe and other
world regions, a rather strong increase in ticket prices is revealed on the main European
intercont-relation to North America in the first half year 2007. In the economy class, fares have
increased by approx. 7.1% and in the premium segment by 6.6%. Simultaneously, a
considerable growth of passenger traffic (16.8%) is seen on this relation, whereas passenger
traffic has only grown by 3.7% in the economy class. The second most important intercont-
corridor with respect to passenger traffic – the one between Europe and Asia – shows a
considerable growth with respect to economy passengers (12.9%) as well as premium
passengers (20.3%). Simultaneously, the average ticket price has increased by 7.5% in the
premium classes, and only by 1.8% in economy class. Likewise, with respect to the growing
flow between Europe and the Middle East, fares have increased (12.9%) in the premium classes
significantly more than in the economy class (4.5%). The relation Europe – North Africa, which is
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mainly frequented by tourists, however, shows dropping fares (-3.3%) in the economy class and
stagnating fares (+1.1%) in the premium classes. For the relations Europe – South Africa and
Europe – South West Pacific fares increased significantly. Here, tickets are almost 10% more
expensive than in the first half of 2006.
Flight Stages with the most Premium and Economy Class Passengers
The IATA evaluation of ticket prices also provides an overview of country pairs, showing the
highest number of premium-class and economy-class passengers. With respect to the premium
classes, the relation between the USA and Canada is the most frequented one (1.6 million
passengers) in the first half of 2007. The average fare in premium classes amounts to 323 US$.
Average premium-class ticket prices for this country pair dropped by 9.8% compared to the first
half 2006. Between the UK and the USA – the second most important relation with respect to
the premium classes – in the first half of 2007, 1.3 million passengers were carried for an
average fare of 2,540 US$. On this relation, the price increase amounts to 5% in the time frame
monitored. The relation Germany - USA shows the third biggest volume (0.8 million premium
class passengers). An average fare of 1,963 US$, which equals a growth of 11.1%, was gained.
Simultaneously, the number of premium class passengers increased by 11.5%. On the relation
France - USA, 0.5 million passengers were carried for a fare of 2,674 US$ in the premium
classes.
When considering the most important country relations with respect to economy class
passengers, the relation UK - Spain, which is mainly frequented by tourists, is number one in the
first half year 2007 (9.8 million passengers). Here, with a slightly rising number of passengers
and a price increase of 4.4%, an average ticket price of 96 US$ was gained. The second biggest
passenger flow between two countries, namely the one between Mexico and USA, shows
passenger traffic of 8.6 million passengers. Then follows the flow between Germany and Spain,
which again is mainly a tourist one. 7.9 million passengers were carried for an average price of
114 US$ in the first half of 2007. Compared to the same period in the preceding year, this is a
passenger traffic growth of 4.4% and a price decrease of 5.8%. In the economy class, the flow
between the USA and the UK shows a high number of passengers (5.8 million). Compared to
average fares for premium classes, the economy class fare is significantly lower (401 US$).
Important City Pairs within Europe
Besides the consideration of ticket prices from a global point of view, the IATA evaluation also
enables the analysis of pricing trends with regard to intra-European flight routes. The most
frequented route in Europe in the first half of 2007 was the relation Dublin – London-Heathrow.
Here, approx. 34,000 premium class passengers and 571,000 economy class passengers were
carried. The average ticket price amounted to 266 US$ for premium and 127 US$ for economy
class. Premium class prices were about 13.2% higher than in the same period in the preceding
year. Economy class showed a price increase of 9.5%. Nevertheless, demand increased by
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11.6% for the economy class, whereas it remained almost unchanged for premium classes. In
the first half of 2007, the second biggest passenger flow was seen on the route Amsterdam -
London-Heathrow. Here, approx. 91,000 passengers were carried in the premium classes and
approx 462,000 passengers in economy class. Compared to the preceding year, demand
decreased by 14.8% for the premium classes. Simultaneously, the ticket price increased by 20%
to 200 US$. Demand for the economy class slightly dropped by 2.7%, whereas prices rose by
approx. 4.9% to 107 US$ per ticket. For the third most frequented relation, Paris-Charles-de-
Gaulle – London-Heathrow, 74,000 premium class tickets and 444,000 economy class tickets
were sold in the first half of 2007. The demand dropped significantly for both price segments:
by 18.2% for premium and by 17.2% for economy class. Simultaneously, ticket prices increased
by 15.1% for premium classes and by 5.5% for the economy class. On the route Copenhagen –
Oslo – the fourth most frequented relation in Europe – in the economy class, passenger traffic
increased by approx. 50%, which amounts to 453,000 passengers, whereas it remained almost
unchanged in the premium classes (approx. 65,000). However, ticket prices rose by approx.
30% for both segments. For the route Dublin – London-Stansted, which is served by low cost
airlines, the average ticket price (49 US$) remained constant when comparing the first half of
2006 with the same period in 2007. However, the number of economy class passengers
dropped by 4.6% to 506,000. There were no premium class passengers counted on this
relation.
2.2 Cargo Airlines
Following the 5.9% drop in growth of the air freight market in 2001 as a result of weakened
global economic growth and the terrorist attacks of 11 September, the sector has found its way
back onto a stable path of growth since the end of 2003. The occurrence of external shocks,
such as SARS, the Iraq war and high oil prices, did have a short term influence on this growth
trend. The most important influencing factor on the growth of the air freight market, however,
is the development of the global economy and international trade. The WTO predicts that
international trade should increase by 7% per year over the long term, which if achieved should
translate into a positive development of the medium to long-term prognosis for market
participants in the air freight sector. Measured according to the value of goods, close to 40% of
world trade is transported by air freight today. This shows the enormous importance of this
sector for the global economy.
The illustration below shows the high correlation between worldwide economic growth, world
trade and the growth of the air freight market, measured in freight tonne kilometres.
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Figure 2-49: Growth rates of the global economy, world trade and air freight (FTK)
Sources: IATA, Merge Global, OECD, World Bank Group, HSH-Nord Bank Research
-10
-5
0
5
10
15
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007F
Air Cargo Growth Trade Volume World-GDP
2007
annual change in %
-10
-5
0
5
10
15
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007F
Air Cargo Growth Trade Volume World-GDP
2007
annual change in %
2.2.1 Cargo Airlines – Supply
There are various types of providers in the air freight market, who differ according to the length
of the value chain and the breadth of services offered. Alongside the all-cargo and combination
airlines, air freight services are also offered by integrators. Originally specialist courier businesses,
the major players in the sector – FedEx, UPS, TNT and DHL – are now transporting an increasing
amount of classic air freight. The integrators and express service providers are sustained by their
global networks. Their processes are standardised, heavily automated and computerised. The air
freight companies Atlas Air and Air Atlanta Icelandic have similarly optimised their businesses,
which involve chartering their fleets and providing fly-on-demand jets, including crew,
maintenance and insurance. The contract carrier market segment is experiencing equally strong
growth. Providers such as Atlas Air Holdings and Evergreen lease their cargo fleets on a wet-
lease basis. According to estimates by Airbus, the proportion of air freight transported on a wet-
lease basis in 2005 was as much as 8.7%.
Annual analyses of the European air transport market
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Table 2-17: Revenue freight
tonne kilometres in 2007
Source: Airline Business
Measured in terms of RTK,
FedEx was by far the largest
air freight carrier in 2007,
with an overall total of
16,008 billion RTK. FedEx has
gained a foothold in the
Chinese market through the
establishment of a central
hub in Guangzhou. Following
in second place by a con-
siderable margin is Air
France-KLM, with a total of
11,365 billion RTK (2007).
The merger of Air France and
KLM has displaced Lufthansa
Cargo as the largest Euro-
pean air freight carrier.
Lufthansa Cargo is seeking to
position itself in the Asian
market through its stake in
Jade Cargo International,
which is the first Chinese air
freight company to attract
foreign investment. The com-
bination airline with the
strongest growth is currently
Korean Air Cargo. The table
shows the results available
for cargo airlines in 2007,
compared to the change in
2006. Integrators and con-
tract charter carriers, such as
Atlas Air and Gemini, are
excluded. Cargo traffic inclu-
des freight and mail, sche-
duled and charter, measured
in freight tonne kilometres.
Airline Country
Cargo traffic
Million RTK
Change
2007 results vs. 2006
FedEx USA 16,008 4.0%
Air France-KLM Group France 11,365 3.4%
United Parcel Service (UPS) USA 9,930 8.5%
Korean Air South Korea 9,677 9.3%
Cathay Pacific China 8,900 18.4%
Lufthansa Cargo Germany 8,451 4.3%
Singapore Airlines Cargo Singapore 7,959 -0.5%
China Airlines Taiwan 6,299 0.2%
Cargolux Airlines International Luxembourg 5,480 4.0%
Emirates UAE 5,413 9.0%
British Airways UK 4,890 4.2%
EVA Air Taiwan 4,774 -7.5%
Japan Airlines Corporation Japan 4,621 -2.7%
Air China China 3,686 12.1%
Asiana Airlines South Korea 3,577 3.1%
American Airlines USA 3,098 -4.6%
Northwest Airlines USA 3,018 -8.9%
United Airlines USA 2,937 -1.8%
Martinair Netherlands 2,854 -7.7%
LAN Airlines Chile 2,702 4.8%
Malaysia Airlines Malaysia 2,633 1.4%
Qantas Australia 2,621 -0.5%
China Eastern Airlines China 2,611 8.2%
Thai Airways Thailand 2,382 16.3%
All Nippon Airways Japan 2,089 21.9%
Kalitta Air USA 1,982 62.5%
China Southern Airlines China 1,973 6.0%
Nippon Cargo Airlines Japan 1,895 -14.2%
Polar Air Cargo USA 1,852 -19.2%
Delta Air Lines USA 1,812 -5.0%
Alitalia Italy 1,630 7.7%
Southern Air USA 1,495 37.6%
Virgin Atlantic Airways UK 1,490 11.9%
China Cargo Airlines China 1,465 17.9%
Continental Airlines USA 1,380 -3.8%
Qatar Airways Qatar 1,321 45.2%
Air Canada Canada 1,271 10.8%
Saudi Arabian Airlines Saudi Arabia 1,262 16.4%
Iberia Spain 1,225 9.5%
Swiss Switzerland 1,164 9.3%
World Airways USA 1,154 6.1%
Evergreen International Airlines USA 1,098 -10.4%
MK Airlines UK 1,081 168.0%
SAS Cargo Denmark 1,024 -5.4%
ABX Air USA 942 13.0%
South African Airways South Africa 933 -11.2%
Shanghai Airlines China 927 57.9%
Global Supply Systems UK 920 3.6%
El Al Israel 873 36.5%
AirBridge Cargo Russia 859 28.9%
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2.2.1.1 Cargo Airlines - Freight Capacity
A general analysis of OAG data over one week in July 2007 with regard to the potential freight
capacity provided by all flights flown by belly-cargo and all-cargo providers gives the results
shown in Figure 2-50 below. The highest capacity was provided on Europe-Asia routes, with
229 flights, followed by North America-Asia routes, with 205 flights. The third highest level was
achieved on services between Europe and North America, but at only 146 thousand tonnes this
fell well below the first two routes. Following behind by a substantial margin were capacities of
93 thousand tonnes on Asia-Middle East routes and 90 thousand tonnes for both North
America-South America and Europe-Middle East.
The picture for inbound and intra-regional freight capacities in the various parts of the world is
as follows. The two areas offering the most inbound freight capacity within a region are Asia
and North America with 631 and 550 thousand tonnes respectively. Well below this are Europe
with 282 thousand tonnes and South America with 202 thousand tonnes. By contrast, it is clear
why experts are predicting an increase in the air freight potential for Africa over the coming
years: only 32 thousand tonnes air freight capacity was available there during the week studied,
according to the OAG data.
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Figure 2-50: World airline traffic 2007: air freight capacity (in thousand tonnes for one week in July)
Source: OAG, DLR
World Airline Traffic 2007
2,837 kt air cargo capacity (one week in July)
Source: OAG, DLR
Europe
Rio de Janeiro
San Francisco
Tor on to
Vanc ouver
Hong Kong
Sydney
Melbourne
Atlanta
Miami
OSL
ROM
LIS
FRA
AMS
PRG
South America
North America
Australia
Africa
Bangkok
Osaka
Johannesburg
Detroit New York
550
282
631
32
146
229
202
46
30
58
38
47
22
12
205
11
2
3
90
93
6
6
65
90
World Airline Traffic 2007
2,837 kt air cargo capacity (one week in July)
Source: OAG, DLR
Europe
Rio de Janeiro
San Francisco
Tor on to
Vanc ouver
Hong Kong
Sydney
Melbourne
Atlanta
Miami
OSL
ROM
LIS
FRA
AMS
PRG
South America
North America
Australia
Africa
Bangkok
Osaka
Johannesburg
Detroit New York
550
282
631
32
146
229
202
46
30
58
38
47
22
12
205
11
2
3
90
93
6
6
65
90
Europe
Rio de Janeiro
San Francisco
Tor on to
Vanc ouver
Hong Kong
Sydney
Melbourne
Atlanta
Miami
OSL
ROM
LIS
FRA
AMS
PRG
South America
North America
Australia
Africa
Bangkok
Osaka
Johannesburg
Detroit New York
550
282
631
32
146
229
202
46
30
58
38
47
22
12
205
11
2
3
90
93
6
6
65
90
If the worldwide freight capacity is considered specifically for cargo airlines, the analysis
produces the charts shown below for the thirty largest providers of European and worldwide
freight capacity. Cargolux leads the field both in the European arena and worldwide. Lufthansa
and Cathay feature in the top performing groups using both analyses of data. Only China
Airlines was able to edge its way between the latter two airlines when considering the global
situation.
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Figure 2-51: World airline cargo traffic: air cargo freighter capacity (one week in July 2007)
Source: OAG
0
10000
20000
30000
40000
50000
60000
70000
80000
Ca
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i
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s Carg
o
Ai
r
Br
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C
argo
Alitalia
in Tons
Figure 2-52: European airline cargo traffic: air cargo freighter capacity (one week in July 2007)
Source: OAG
0
10000
20000
30000
40000
50000
60000
Car
gol
ux Airlines I
nt
ernationa
l
Luf
than
sa
Ge
r
man Ai
r
l
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s
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ch Air
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Air
New Zealand
in Tons
2.2.2 Cargo Airlines – Demand
Due to the advance of globalisation and the outsourcing of production facilities and ancillary
industries to emerging markets, the level of intercontinental connections, measured in freight
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 101
tonne kilometres (FTK), in particular are growing at an above average level. Measured against
the global volume of air freight using the AEA data, the European domestic air freight market
has shown a decline.
Table 2-18: Scheduled cargo services of AEA member airlines in 2007
Source: AEA
AEA Air Freight Data Traffic (million) TFTK %
Domestic (1) 117.3 -7.8
Cross-border Europe (2) 737.1 -3.7
Total Europe (1+2) 856.4 -4.1
Europe - North Africa (3) 190.4 11.2
Europe - Middle East (4) 988.2 -0.7
Intl Short/Medium Haul (2+3+4) 1,919.9 -0.7
North Atlantic (5) 10,636.1 3.5
Mid Atlantic (6) 1,590.6 2.1
South Atlantic (7) 2,551.9 12.8
Europe - Sub Saharan Africa (8) 3,395.8 10.3
Europe - Far East/Australasia (9) 17,309.0 0.0
Total Longhaul (5 to 9*) 35,500.6 2.9
Total International (2 to 9*) 37,446.4 2.7
Total Scheduled (1 to 9*) 37,563.7 2.7
* Long-haul region 'Other' is not shown above, but is included in the total
Freight traffic is measured in TFTK (Total Freight Tonne-Kilometres) all-cargo services, excluding
mail. Growth rates have been adjusted for changes in membership. Introduced in 2004, the new
route area Total Europe includes 'international' or Cross-border Europe services and Domestic
services.
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Annual Report 2007
2008-12-02 Annual Report 2007
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2.2.2.1 Cargo Airlines - Tonnes of Freight
Intra-European air freight growth has been slow over the past several years as regional air
freight volume has come under pressure. The close proximity of major cities makes truck and rail
transit cost effective and reasonably acceptable in terms of transit time.
The IATA CASS System (Cargo Accounts Settlement System) is a system to simplify the billing
between Freight Forwarders and Airlines. CASS data are billing data taken from the Air Waybill’s
data fields. Analyses of cargo based on IATA-Airway-Bills are export-oriented (documents to
retrace the cargo’s origin and destination). At present, CASS data is available from following
countries: Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Greece, Ireland, Italy,
Luxembourg, Malta, Netherlands, Norway, Portugal, Spain with the Canary Islands, Sweden,
Switzerland, Turkey and the United Kingdom. Data covering the EU-27 is provided by Eurostat;
please refer to Table 1-5 in the first chapter.
Figure 2-53: Freight out of European CASS member states to various regions, 2006 vs. 2007
Source: IATA CASS
291,883
39,789
88,849
338,043
430,158
459,056
1,088,890
190,113
184,095
762,515
124,505
302,220
38,836
94,834
329,212
433,508
504,267
1,093,172
216,940
207,801
873,188
131,232
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Africa
Caribbean
Central America
Europe
Japan & Korea
Middle East
North America
South America
South Asian
Subcontinent
South East Asia
South West Pacific
freight in tons
2006 2007
This view is also supported by the table below. According to this data, the air freight market
within Europe has suffered a clear decline of 2.3 percent. By contrast, the flow of freight out of
Europe saw an above-average growth of 7.2 percent in 2007 compared to the previous year.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 103
Figure 2-54: Percentage change in freight originating in Europe (CASS), 2006 vs. 2007
Source: IATA CASS
0.4%
0.8%
3.5%
5.4%
6.7%
9.8%
12.9%
14.1%
-2.3%
-2.4%
14.5%
7.2%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Europe
Caribbean
North America
Japan & Korea
Africa
South West
Pacific
Central
America
TOTAL
Middle East
South Asian
Subcontinent
South America
South East Asia
If the proportion of the demand for air freight in 2007 is considered on the basis of the
countries covered by the IATA CASS system, then the major flows of air freight out of Europe
are to North America (26 percent) and to South East Asia (e.g. China and Hong Kong)
(21 percent).
Figure 2-55: Percentage
distribution of freight out of
Europe in 2007
Source: IATA CASS
North America
26%
South America
5%
South Asian
Subcontinent
5%
Middle East
12%
Japan & Korea
10%
Europe
8%
Caribbean
1%
Africa
7%
South West Pacific
3%
South East Asia
21%
Central America
2%
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2008-12-02 Annual Report 2007
Page 104 Release: 2.2
2.2.2.2 Cargo Airlines - Freight Kilometres
Figure 2-56: Air freight traffic originating in Europe carried by CASS members by region; 2006 vs. 2007
Source: IATA CASS
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
South East Asia
North America
Japan & Korea
South West
Pacific
Middle East
South America
Africa
South Asian
Subcontinent
Central America
Europe
Caribbean
in Millions of FTK
2006 2007
Figure 2-57: Growth of air freight traffic originating in Europe carried by CASS members by region; 2006
vs. 2007
Source: IATA CASS
% Changes
-2.3
3.7
8.4
9.4
13.6
14.0
0.8
2.3
-0.2
5.4
14.4
-5
0
5
10
15
Caribbean
Europe
Japan & Korea
North America
Africa
S
outh West Pacific
Central America
Middle East
South East Asia
South Asian
Subcontinent
South America
Annual analyses of the European air transport market
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Release: 2.2 Page 105
If the air freight carried by AEA members
in 2007 is considered in comparison to
2006, then the market leaders in Europe
are clear: the German carrier Lufthansa
(with 8,346.0 TFTK) only lost its top
position due to the merger of Air France
(6,136.9 TFTK) with KLM (4,953.8 TFTK).
Cargolux (5,479.8 TFTK) and British
Airways (4,518.0 TFTK) form the core
group accounting for 27% of the total
freight tonne kilometres of AEA airlines.
Despite a growth of 11.7% compared
to 2006, Alitalia is far behind with only
1,659.8 TFTK.
Table 2-19: AEA members' air freight traffic,
2006 vs. 2007
Source: AEA
2.2.3 Cargo Airlines - Fleet
The world’s largest cargo fleets are operated by integrators. The two largest operators, FedEx
and UPS, alone operate 17.3% of all cargo aircraft world-wide. Taking into account that
integrators often use wet-lease agreements with other operators, the position of these carriers
would be even stronger. This also applies for the DHL Group, which includes fully owned
subsidiaries Blue Dart Aviation, DHL Aero Expreso, DHL Ecuador, DHL de Guatemala, DHL Air,
European Air Transport and SNAS. In addition to these carriers in the group, it has to be
mentioned that ABX Air and Astar Air Cargo also almost exclusively operate for DHL. Adding
these carriers to the group would reduce the gap to the market leaders FedEx and UPS.
It is worth noting the fact that more than 70% of the world fleet of aircraft between 50 t and
100 t are operated by only five different airlines; FedEx alone operates more than 41% of the
world fleet in this category. In total, the 20 largest operators account for 51.3% of the payload
capacity of the world’s cargo fleet and 30.3% of all cargo aircraft.
Freight Data
AEA Airlines Traffic
TFTK TFTK
(mill) %
LH
DEUTSCHE LUFTHANSA AG 8,346.0 3.2
AF
AIR FRANCE 6,136.9 4.3
CV
CARGOLUX 5,479.8 5.0
KL
KLM ROYAL DUTCH AIRLINES 4,953.8 1.0
BA
BRITISH AIRWAYS PLC 4,518.0 -4.4
AZ
ALITALIA 1,659.8 11.7
VS
VIRGIN ATLANTIC AIRWAYS 1,489.9 11.9
LX
SWISS INTERNATIONAL AIRLINES 1,159.7 6.5
IB
IBERIA 1,121.4 9.3
SK
SAS - SCANDINAVIAN AIRLINES 546.0 -9.9
A
Y
FINNAIR 489.7 19.9
TK
TURKISH AIRLINES 477.5 6.8
O
S
AUSTRIAN 453.8 -22.7
TP
TAP PORTUGAL 318.8 13.4
BD
BMI 96.7 -33.6
LO
LOT POLISH AIRLINES 83.1 3.8
SN
BRUSSELS AIRLINES 79.9 6.0
OA
OLYMPIC AIRLINES 65.8 2.2
O
K
CSA - CZECH AIRLINES 32.7 -17.1
MA
MALEV HUNGARIAN AIRLINES 26.0 2.9
KM
AIR MALTA 8.6 -20.3
RO
TAROM ROMANIAN AIR TRANSP
O
5.5 13.9
CY
CYPRUS AIRWAYS 4.1 -90.6
JU
JAT AIRWAYS 4.1 -1.9
JP
ADRIA AIRWAYS 3.8 11.7
OU
CROATIA AIRLINES 2.2 6.2
LG
LUXAIR 0.0 -94.9
37,563.7 2.7
∑ AEA
2007
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2008-12-02 Annual Report 2007
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Table 2-20: The 20 largest cargo airlines by fleet payload capacity at year-end 2007
Source: Ascend Online Fleets, data as of April 2008
*) DHL Group includes Blue Dart Aviation, DHL Aero Expreso, DHL Ecuador, DHL de Guatemala, DHL Air, European
Air Transport and SNAS. Also ABX Air and Astar Air Cargo have operated almost exclusively for DHL.
Table 2-21: Cargo aircraft in service at year-end 2007
Source: Ascend Online Fleets, data as of April 2008
Table 2-21 shows the development of the
world cargo aircraft fleet from 2006 to
2007. Overall, the number of freighters
declined slightly from 3461 in 2006 to
3446 in 2007. A particularly high number
of smaller aircraft with a maximum
payload of up to 25,000 kg have been withdrawn from service, whereas the number of larger
freighters with a maximum payload of more than 50,000 kg has increased. The demand for very
large freighters with a maximum payload of more than 100,000 kg experienced particularly high
growth. The number of these aircraft in the world fleet has increased by almost 9% from 313 to
341 year-over-year. The growth in the market for large intercontinental cargo aircraft reflects
increasing world trade, particularly between Europe and Asia and North America and Asia.
max. payload 2007 2006 change
1000–10,000kg
1285
1289 -0.3%
10,001–25,000kg
668
735 -9.1%
25,001–50,000kg
814
799 1.9%
50,001–100,000kg
338
325 4.0%
100,001–250,000kg
341
313 8.9%
Total car
g
o fleet 3446 3461 -0.4%
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 107
Table 2-22 shows the average age of the world cargo aircraft fleet. In comparison to the world
passenger aircraft fleet, the cargo fleet is relatively old. Many of the fleet are passenger aircraft
that have been converted and are now enjoying a second life as a freighter. This trend has even
continued in the current environment of rising fuel prices, as cargo aircraft are usually not as
intensely used as passenger aircraft. This means that cargo aircraft operators feel the pressure of
rising fuel prices to a lesser extent than passenger aircraft operators.
Table 2-22: Average age in years of cargo aircraft at year-
end 2007
Source: Ascend Online Fleets, data as of April 2008
The largest freighters have the youngest average
age, as compared to all other freighter classes.
Many new large freighters have been delivered (the
only type delivered in 2007 was the Boeing 747-
400F), while older aircraft have been retired. Additionally, many relatively young 747 passenger
aircraft have been converted as airlines have replaced these aircraft with more economical and
environmentally efficient twin-engine jets. In future, it can be expected that the average age of
large (50 t–100 t maximum payload) and very large (100 t+ maximum payload) freighters will
decrease as new types are introduced, namely the Airbus A330-200F, Boeing 777-200F/LRF and
Boeing 747-8F. In the market segment comprising the smaller freighters (10 t–25 t), the
relatively high average age of more than 32 years can be expected come down as older A320-
type passenger aircraft will be converted. Despite the age of these aircraft generally being
between 10 and 20 years, they still represent best available technology on the market.
2.2.4 Cargo Airlines - Financial Performance
2007 was characterised by strong growth in the world economy and world trade. However,
increasing oil prices and capacity expansion have led to a difficult environment for the cargo
operators. Most of the major cargo airlines have increased their fuel surcharges throughout the
year 2007. Lufthansa Cargo for instance raised its fuel surcharges to € 0.65 per kg of air freight
in October, Air France-KLM’s surcharge stood at € 0.80 per kg at year end. The same surcharge
was applied by Cargolux.
Air France-KLM Cargo is the second largest cargo airline worldwide behind FedEx in terms of
cargo traffic in revenue ton kilometres. It operates a total of 13 747 freighters and additionally
carries a large amount of belly cargo on its passenger services. In the financial year from April
2007 to March 2008 the company generated cargo revenues of € 2.93 billion, which is no
significant difference to cargo revenues of € 2.91 billion in the comparable period of 2006/07. A
similar distribution shows the operating income in the cargo business segment for the years
2007/08 and 2006/07. In this period the operating income rose also moderately from € 62
million to € 63 million.
max. pa
y
load 2007 2006
1000–10,000kg
26.48
25.88
10,001–25,000kg
32.37
32.52
25,001–50,000kg
20.69
20.42
50,001–100,000kg
19.92
19.37
100,001–250,000kg
15.39
15.42
Total car
g
o fleet 24.51 24.47
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2008-12-02 Annual Report 2007
Page 108 Release: 2.2
Lufthansa Cargo, operating 19 MD-11 freighters and managing the belly cargo capacities of
Lufthansa Passage Airlines and several other companies in the Lufthansa group, reported a
decline in revenues from € 2.8 billion concerning 2006 to € 2.7 billion in 2007. The decline of
3.8% in total revenues is contrasted by an increase of revenue tonne kilometres of 4.3%. The
contradicting trend in revenues and revenue ton kilometres is an indication for relatively strong
competition, resulting in a decline in yields. At the same time, the operative result increased by
65.9% from € 82 million to € 136 million, as costs were reduced to a larger extent than
revenues declined.
The third largest cargo carrier in Europe, as measured by revenue tonne kilometres, is Cargolux
from Luxemburg. The carrier operates a fleet of 15 Boeing 747-400 freighters. The most recent
financial report refers to US-$ 1.7 billion revenues for the financial year 2007. In contrast to US-
$ 1.5 billion revenues in 2006 this trend marks an increase of 11.8%. At the same time the
company generated an operating loss of US-$ 33 million in 2007 due to a significant lower
other operating income than in 2006.
British Airways reported an increase in cargo revenues by 3% to £ 616 million for the period
April 2007 to March 2008 in comparison to the previous financial year. The amount of cargo
tonnes carried rose by 5.6% while revenues per tonne kilometre climbed only moderately by
0.9%.
The anecdotal evidence of the four carriers’ financial results suggests a diverse picture for the
overall calendar year 2007: On the one hand, a solid growth in the world economy and world
trade led to an increasing demand for air cargo services. On the other hand, the commercial and
financial success of the four largest European air cargo carriers is limited. Operating profit
margins are below comparable margins for passenger services. Strong competition due to
capacity increases, imbalanced traffic flows and high fuel costs lead to a difficult commercial
environment for the air cargo business.
2.2.5 Cargo Airlines - Alliances
Following on from the trend of passenger businesses towards alliances that started a few years
earlier, an increasing number of air freight carriers are now joining to form alliances. The aim of
these co-operations is, on the one hand, to lower costs through mutual exploitation of freight
capacity, expansion of route networks and the provision of a broader range of products, whilst
on the other hand defending and building the competitive position of the companies. These
arguments are equally applicable here as they are to passenger transport. An additional reason
exclusive to the freight business is the heavy competition from integrators. Currently there are
two freight alliances in the market. The first of these, the WOW alliance, was established by the
three members of the Star Alliance passenger alliance. The second alliance, SkyTeam Cargo, is
the cargo arm of the SkyTeam passenger alliance.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 109
The following sections provide a short overview of the two cargo alliances.
WOW
WOW is a strategic alliance between four airlines. WOW is not an abbreviation. It is a name
chosen to reflect the dynamism and innovation of the organisation. WOW was established in
April 2000 by Lufthansa Cargo, SAS Cargo and Singapore Airlines. Japan Airlines joined the
alliance in July 2002.
The participating airlines have access to a network of 523 destinations in more than 100
countries. The alliance has over 43 freight aircraft and access to the belly capacity of 760
passenger aircraft. In 2004 WOW achieved a global market share of 12% or 19.3 billion FTK.
With the exception of JAL Cargo, the passenger businesses of the WOW members are
represented in the Star Alliance. JAL belongs to the oneworld Alliance.
WOW members: Lufthansa Cargo (LH), SAS Cargo (SK), Singapore Airlines (SQ) and Japan
Airlines (JL).
Figure 2-58: Available freight capacity in
tonnes (belly & freighters) WOW members –
worldwide (one week in July 2007)
Source: OAG
Note on founding WOW member
Lufthansa Cargo: On 28 October 2007,
the Russian authorities declared a ban
on overflights by Lufthansa Cargo.
Russia had requested that the German
company relocate its freight hub from
the Kazakh city of Astana to
Krasnoyarsk in Siberia. On 2nd
November the German Transport Ministry softened their stance and declared that the German
side was prepared concede and move the Lufthansa hub to Krasnoyarsk in Russia. In 2007
Lufthansa flew 49 times per week from Frankfurt to Astana and Tashkent. Flights continue from
there to other destinations in Asia.
Japan Airlines
International
102736
Lufthansa German
Airlines
78674
SAS Scandinavian
Airlines
8889
Singapore Airlines
125172
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Page 110 Release: 2.2
Figure 2-59: Available freight capacity in tonnes (freighters only) WOW members – worldwide (one week
in July 2007)
Source: OAG
Japan Airlines
International Cargo
29757
Lufthansa Cargo
50892
Singapore Airlines
Cargo
58533
The charts show the worldwide freight capacity offered by WOW members in tonnes, according
to data from the OAG. Figure 2-58 shows belly and freight aircraft, while Figure 2-59 shows
only the tonnage offered by dedicated freight aircraft.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 111
SkyTeam Cargo
SkyTeam Cargo was established in September 2000. The founding members, Aero Mexico
Cargo, Air France Cargo, Delta Air Logistics and Korean Air Cargo, are all members of the
SkyTeam passenger alliance. Czech Airlines Cargo was incorporated as a new member in April
2001, followed by Alitalia in August of the same year. With the incorporation of KLM Cargo in
September 2004, SkyTeam Cargo succeeded in displacing the WOW Alliance as the largest
freight group, measured in terms
of freight tonne kilometres. This
position was further strengthened
by the incorporation of Northwest
Airlines Cargo.
Figure 2-60: Available freight capacity
in tonnes (belly & freighters) SkyTeam
Cargo members – worldwide (one
week in July 2007)
Source: OAG
The alliance flies to 728
destinations in 149 countries. The
fleet consists of over 2360 aircraft
and in 2006 achieved a global
market share of 13.7% with 22.6 billion freight tonne kilometres (FTK) carried per year.
SkyTeam Cargo members: AeroMexico Cargo (AM), Air France Cargo (AF), Alitalia Cargo (AZ),
CSA Cargo (OK), Delta Air Logistics (DL), KLM Cargo (KL), Korean Air Cargo (KE), NWA Cargo
(NW).
The charts show the worldwide freight capacity offered by SkyTeam Cargo members in tonnes,
according to data from OAG.
Figure 2-60 shows belly and freight
aircraft, while Figure 2-61 shows
only the tonnage offered by
dedicated freight aircraft.
Figure 2-61: Available freight capacity
in tonnes (freighters only) SkyTeam
Cargo members – worldwide (one
week in July 2007)
Source: OAG
Air France
38855
Aeromexico
6944
Delta Air Lines
49952
Northwest Airlines
81392
Czech Airlines
1083
Alitalia
24991
KLM-Royal Dutch
Airlines
57631
Korean Air
88476
Air France Cargo
26388
Alitalia Cargo
7933
Korean Air Cargo
20376
KLM-Royal Dutch
Airlines Cargo
5523
Northwest Airlines
Cargo
33136
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 112 Release: 2.2
Comparison of WOW vs. SkyTeam Cargo
The following chart shows a comparison between the freight capacities offered by the two
cargo alliances. By this measure, SkyTeam Cargo provides slightly larger capacity.
Figure 2-62: Available freight capacity in tonnes (belly & freighters) WOW vs. SkyTeam Cargo – worldwide
(one week in July 2007)
Source: OAG
Aeromexico
1.0%
Czech Airlines
0.2%
Singapore Airlines
18.8%
KLM-Royal Dutch
Airlines
8.7%
Air France
5.8%
Delta Air Lines
7.5%
Alitalia
3.8%
Korean Air
13.3%
Northwest Airlines
12.2%
Japan Airlines
International
15.5%
Lufthansa German
Airlines
11.8%
SAS Scandinavian
Airlines
1.3%
WOW
SkyTeam Cargo
47%
53%
2.2.6 Cargo Airlines - Competition
Two types of providers have profited from the boom: door-to-door carriers, such as the
international express services DHL, FedEx and UPS with their own fleets; and those service
providers that systematically charter their fleets to logistics companies (wet lease). Leading
providers in the latter category are the US-based Atlas Air Inc. and their Icelandic competitor, Air
Atlanta Icelandic. According to industry observers, these companies offer a "more economical
cost structure and greater profitability" (Accenture GmbH) in comparison to full-service
providers. Lufthansa Cargo, a combination carrier, is looking to capture some of this market
through its deal with DHL. While Lufthansa Cargo is able to offer transportation rights on
international routes, they in turn will profit from the massive transportation volume of their new
partner.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 113
Because air-freight is more expensive than other transportation options, and with the price
differential between air freight and other modes of transport increasing, some shippers are
shifting their business from air to surface transport. This trend has meant that shippers within
Europe, following the pattern set in the USA, have optimised both their logistics planning and
their networks to such an extent that the speed advantages of domestic air freight have been all
but neutralised.
One of the challenges for air freight providers is to compete effectively with ocean freight. In
recent years, ocean container freight has seen average growth of over 9 percent, a figure more
than double that achieved by air freight. This notwithstanding, the aeroplane remains the
preferred means of transport for high-cost and time-sensitive goods, although by far the biggest
proportion of merchandise in terms of tonnage is shipped by sea.
In terms of volume, air freight represents just 5 percent of the total volume of shipments, but
35 percent of the value of shipments, totalling nearly US$12 trillion (Aleks Popovich, IATA’s
Global Head of Cargo).
Nonetheless, with trends shifting towards surface transport and higher fuel prices exacerbating
the gap between ocean and air pricing, ocean freight has proved to be more competitive and is
growing at a faster rate than air freight.
As a result of heavy competition and excess capacity, the pricing pressure on air freight has also
increased strongly. The achievable turnover per unit (RPK or FTK) has fallen significantly since
1985. The downward trend of freight rates in past years has been halted for the time being. The
primary reason for the end of the decline in prices in recent years is the establishment of
additional surcharges for security and fuel. Taking into account increasing additional surcharges
for security and,
above all, for fuel, the
turnover per freight
tonne kilometre
achieved in the last
few years by the
market-leading cargo
airlines has increased
slightly.
Figure 2-63: Turnover
per FTK for various
airlines
Source: HSH-Nord Bank
Research
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 114 Release: 2.2
In contrast to passenger baggage, freight arrives in the cargo hold practically unscreened. In
light of the terror attacks and heightened security requirements, there is currently an intensive
effort to find ways of increasing screening capacity for air freight. In view of those security
regulations that have already been adopted, nearly all airlines have now established surcharges
in order to be able to finance the necessary infrastructure. The air freight market does not react
with elastic pricing to the same extent as other transportation markets (certainly in the case of
express and special freight), because, due to their particular characteristics, the goods carried
cannot be transported by any other method. In many cases an alternative to air freight does not
exist.
During 2007 various airlines have found themselves in the sights of the competition regulators.
At the time of writing, none of the investigations had been concluded.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 115
3 Airports
3.1 Passengers
Figure 3-1 shows the world’s top 20 airports in terms of passengers handled in 2007. These 20
airports handle 23% of the commercial air passengers worldwide; the degree of concentration is
thus higher than in the case of aircraft movements (see 3.2). The total number of passengers
handled worldwide in 2007 was 4.7 billion. Again, Atlanta Hartsfield-Jackson International and
Chicago O’Hare International occupy places one and two respectively, but the decline of
passenger figures from place 1 to 20 is much smoother than in the case of aircraft movements.
Figure 3-1: The 20 biggest airports in terms of commercial air passengers worldwide
Source: ACI 2008
Number of Passengers
0
10.000.000
20.000.000
30.000.000
40.000.000
50.000.000
60.000.000
70.000.000
80.000.000
90.000.000
ATLANTA
H
ARTSF
I
E
L
D-JAC
KS
O
N
IN
TL
(USA)
CH
I
CAGO O'HARE INTL (USA
)
LONDON HEA
T
HROW (UNIT
ED
KINGDOM)
TO
KYO
I
N
TL
(H
A
N
ED
A
)
(J
A
PA
N
)
LO
S
A
N
G
E
L
ES
I
N
TL
(
U
SA)
DA
L
LAS/FOR
T
W
O
RTH INTL
(USA)
PA
R
IS C
H
A
R
L
ES
DE
GA
U
L
L
E
(FRA
N
C
E)
F
R
A
N
K
FU
R
T/M
A
I
N
(GER
MA
N
Y)
BEIJI
N
G CAPITAL INTL (CHINA )
MADR
I
D BAR
A
JAS (SPAIN)
D
ENVER INTL (USA)
A
MSTE
R
D
AM
SC
H
IPH
O
L (N
ET
HERL
AN
D
S)
NEW YOR
K JO
HN F.
KE
NNEDY INTL (
U
SA
)
LAS
VEG
AS MCCA
R
R
A
N
I
N
TL
(USA)
H
ON
G
KONG
I
N
TL
(C
H
I
N
A
)
HO
U
STON
G
EORGE B
U
SH
I
N
TER
C
ONTIN
EN
TAL
(
USA)
P
H
O
EN
IX SKY
H
AR
B
OR
I
N
TL
(
U
SA
)
B
A
N
G
KOK SU
VA
R
N
A
B
HUMI
INTL
(TH
A
I
LA
N
D)
OR
L
A
N
DO
I
N
TL
(U
SA
)
N
EW
ARK LIBERTY INTL
(
USA)
2007 2006
Total commercial passenger numbers sum up to 89 million passengers for Atlanta Hartsfield-
Jackson International and 77 million passengers for Chicago O’Hare International. Of EU
airports, London Heathrow is ranked third with 67 million passengers handled and Paris Charles
de Gaulle is on place seven with 60 million passengers in 2007. The airports Frankfurt/Main (54
million passengers), Madrid Barajas (52 million passengers) and Amsterdam Schiphol (48 million
passengers) follow on places eight, ten and twelve respectively. Munich Airport in Germany is
not represented within the top 20 places. The reason for London Heathrow moving ten places
upwards compared to the top 20 ranking regarding flight movements is the higher share of
Marketshare in the World
23%
77%
Top 20 Airports
Other Airports in the World
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 116 Release: 2.2
intercontinental flights and thus a higher average seat capacity per aircraft. As mentioned
earlier, the average seat capacity per aircraft is lower at US airports, caused by the higher share
of domestic flights operated with smaller aircraft.
Furthermore, the top 20 airports with respect to commercial passengers handled comprise four
Asian airports (passenger figures in brackets): Tokyo International/Haneda (67 million
passengers), Beijing Capital International (54 million passengers), Hong Kong International (46
million passengers) and Bangkok International (40 million passengers).
Figure 3-2 displays the top 20 European airports in terms of commercial passengers handled.
These airports handle 14% of the worldwide air passengers and 45% of the passengers at
European airports. The total number of passengers at European airports was 1.5 billion in 2007.
Within Europe, concentration on the top 20 airports regarding passenger numbers is
considerably higher than in the case of aircraft movements, one reason being the comparatively
higher share of intercontinental flights with larger aircraft and thus higher seat capacity per
flight than e.g. in the USA. The number of passengers range from 68 million for London
Heathrow to 19 million for Moscow Domodedovo International. The first five places of Europe’s
top 20 airports are occupied by the main international hubs of Europe, followed by national
hubs for European or selected intercontinental destinations.
Figure 3-2: The 20 biggest airports in terms of air passengers in Europe
Source: ACI 2008
Number of Passengers
0
10.000.000
20.000.000
30.000.000
40.000.000
50.000.000
60.000.000
70.000.000
80.000.000
LON
D
ON
H
EAT
H
ROW (UNITED KINGD
O
M
)
PA
R
I
S
C
H
A
R
L
ES DE GAULLE (
F
R
A
N
C
E)
F
R
A
N
K
F
URT
/M
AIN
(GERM
A
NY)
MA
D
RID BARAJ
A
S (S
PA
IN)
A
MSTERDA
M
SC
H
IPHOL (NETHERLAND
S)
LO
N
D
ON
GAT
W
ICK
(U
N
I
TE
D
KI
N
GD
OM)
M
UN
I
CH
(GER
MANY)
BARCELONA
(SPA
IN
)
ROME
F
IU
MIC
INO (
I
TAL
Y)
PARIS ORLY (FRANCE)
L
ON
D
ON S
TA
NST
ED
(
UN
I
TE
D
KINGD
O
M)
MI
LA
N
MA
L
P
EN
SA
(ITA
L
Y)
DUBLIN (IR
EL
A
N
D)
PALMA DE MALLORCA (SPAIN)
ISTANB
U
L ATATÜRK INTL
(TU
R
KEY
)
MA
N
CH
EST
ER
(U
N
ITED
KI
NG
D
OM)
COPENH
A
GEN
I
NTL
(DENMARK)
ZURICH (SWITZERLAND)
O
SLO INTL (
N
O
R
WAY)
MOSCOW DOMO
D
OVO INTL (
R
US
SI
AN FED
ER
A
T
ION)
2007 2006
Marketshare in the World
14%
86%
Top 20 Airports
Other Airports in the World
Marketshare in Europe
45%
55%
Top 20 Airports
Other Airports in Europe
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 117
3.2 Aircraft Movements
Aircraft movements are defined as the total volume of commercial aircraft movements of
passenger, freight and combined air traffic. Figure 3-3 shows the busiest 20 airports worldwide
in terms of commercial aircraft movements in 2007. There were a total number of 52.9 million
commercial aircraft movements worldwide, of which the world’s top 20 airports cover 21%. By
far the two busiest airports are Atlanta Hartsfield-Jackson International and Chicago O’Hare
International, both in the USA, with about 981 000 and 911 000 aircraft movements in 2007
respectively. Places three to seven are also occupied by US airports, with aircraft movements
ranging between 679 000 and 547 000.
The biggest European airport regarding aircraft movements is Charles De Gaulle in Paris, France
with 544 000 aircraft movements on place eight. The second European airport is Frankfurt/Main
in Germany with 486 000 aircraft movements in 2007 on place eleven. The European Airports
Madrid Barajas, London Heathrow, Amsterdam Schiphol and Munich follow on the places 12,
13, 17 and 20 respectively. The number of aircraft movements at these airports vary between
476 000 for London Heathrow and 407 000 at Munich.
Figure 3-3: The 20 biggest airports in terms of flight movements worldwide
Source: ACI 2008
Number of Movements
0
200.000
400.000
600.000
800.000
1.000.000
1.200.000
ATLA
N
TA
H
A
R
TSFI
EL
D
-
JA
C
KSO
N
IN
TL
(
USA
)
CH
I
CAGO O'HARE INTL (USA
)
D
A
L
L
A
S/
F
O
RT W
OR
TH
I
N
TL (
U
SA
)
L
O
S
A
N
GEL
ES
I
N
TL
(U
SA
)
D
EN
VER
I
N
TL
(U
SA
)
HO
U
STON
GEOR
GE BUSH
I
N
TER
C
ONTIN
EN
TA
L
(
U
SA
)
L
A
S VEGA
S
MC
C
ARRAN INTL (USA)
PA
R
IS C
H
A
R
L
ES
DE
GA
ULL
E
(FRA
N
C
E)
P
HOENIX S
KY
H
A
R
B
O
R INTL
(
USA)
C
HARLOTTE/D
OU
GLAS INTL
(
USA
)
F
R
A
N
KF
U
R
T/
MA
I
N
(GER
M
AN
Y)
M
A
DR
ID
BARAJAS
(
SPA
I
N
)
L
O
NDON
H
EA
TH
R
OW
(
UN
ITED
KIN
G
DOM)
PHILALPHIA
INTL (
U
SA)
D
ETR
OI
T
METRO W
A
YN
E
COU
N
TY
(U
SA
)
NEW YORK
J
OHN F. KENNEDY INTL (
U
SA
)
A
MSTERDA
M
SC
H
IPHOL (NETHERL
A
NDS)
N
EW
ARK LIBERTY INT
L
(USA)
MIN
N
EAP
O
LIS/ST. P
A
U
L
IN
TL
(U
SA
)
MUNI
C
H
(
GERM
A
N
Y
)
2007 2006
With regard to commercial aircraft movements, the 20 largest airports worldwide are exclusively
located either in the USA (14) or in Europe (6). The ranking of Figure 3-3 shows a large decline
in the number of aircraft movements for the top two ranked airport Chicago O’Hare
Marketshare in the World
21%
79%
Top 20 Airports
Other Airports
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 118 Release: 2.2
International and for the third-ranked airport Dallas/Fort Worth. The high number of US airports
in the top ranking is largely attributable to the comparatively higher utilisation of smaller aircraft
at US airports for domestic air travel, resulting in a lower average seat capacity per aircraft as
compared to European or Asian airports.
Figure 3-4 displays the busiest 20 airports in Europe in terms of commercial aircraft movements
for 2007. They cover 12% of worldwide commercial aircraft movements, which sum up to 6.3
million. The total number of European commercial aircraft movements in 2007 was 16.6 million,
of which Europe’s top 20 airports cover 38%.
The number of aircraft movements at the 20 busiest airports lies in a range between 544 000
for Paris Charles de Gaulle and 205 000 for the airport Stockholm Arlanda. The top five places
are occupied by international hub airports in Europe (aircraft movements in brackets): Paris
Charles de Gaulle (544 000), Frankfurt/Main (486 000), Madrid Barajas (482 000), London
Heathrow (476 000) and Amsterdam Schiphol (436 000). The remaining airports comprise
national hub airports, which mainly serve European and selected intercontinental destinations.
Figure 3-4: The 20 biggest airports in terms of flight movements in Europe
Source: ACI 2008
Number of Movements
0
100.000
200.000
300.000
400.000
500.000
600.000
PA
R
I
S
C
H
A
R
L
ES
DE
GA
ULL
E (
F
R
A
N
C
E)
FRANKFURT/MAIN (GERMANY)
MA
D
R
ID
B
ARAJA
S (
SPA
IN)
L
O
N
D
ON
H
EA
TH
R
OW
(
UN
ITED
KIN
G
D
OM)
AM
STER
D
A
M
SC
HIPH
OL
(
N
ETH
ER
LAN
D
S)
MUNICH (GERMANY)
BARCELON
A
(
SPA
IN)
RO
M
E FIUMICINO
(
ITALY)
MILAN MALPENSA (ITALY)
LON
D
ON
G
ATW
I
CK (UNITED
KI
N
GDOM)
C
OPEN
H
AGEN
I
N
TL (
D
ENM
A
R
K)
VIEN
NA
INTL (
A
U
STR
IA)
I
ST
A
NBUL A
TA
TÜ
R
K INT
L
(
T
U
RKE
Y)
BRUXELLES NAT
L
(BELGIUM)
PARI
S
ORLY (
F
R
A
NC
E
)
ZU
RIC
H
(
SW
ITZERLAND
)
OSLO INTL (NORWAY)
DÜSSEL
D
ORF
(GER
M
AN
Y
)
M
AN
C
H
ESTER
(U
N
I
TE
D KIN
GD
OM)
STO
CKHOL
M
A
R
L
A
N
D
A
(SWEDEN
)
2007 2006
Figure 3-5 shows the top 25 low cost airports in Europe in terms of aircraft departures per week
with the third week in July 2007 being the reference. London Stansted has the highest number
of low cost carrier take-offs of any airport in Europe. The number of low cost carrier departures
per week sums up to 1 751, while the total number of commercial take-offs is 1 886. Low cost
Marketshare in the World
12%
88%
Top 20 Airports in Europe
Other Airports in the World
Marketshare in Europe
38%
62%
Top 20 Airports in Europe
Other Airports in Europe
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 119
carriers therefore account for nearly 93% of all take-offs at London Stansted. The airports of
Barcelona and Palma de Mallorca follow on places two and three with 898 and 838 low cost
carrier take-offs respectively. However, the share of low cost operations is much smaller there
than at London Stansted. Airports with a similar share of low cost operations are for example
Berlin Schoenefeld, Belfast International, Southampton and Milan Orlo al Serio. The share of low
cost carrier take-offs varies between 79% and 93% at these airports. The total number of
commercial take-offs of these airports lies in a range between 435 and 533, thus significantly
smaller than at London Stansted.
While low cost carriers concentrate operations more at airports serving primarily point to point
traffic, there are also some hub airports in Europe with a considerable amount of low cost
traffic, such as Paris Charles de Gaulle, Amsterdam and Munich airport. The number of low cost
carrier take-offs varies between 400 and 600. However, compared to the total number of
commercial aircraft movements, their share is still low, ranging from 10% for Paris Charles de
Gaulle to 27% for Düsseldorf airport.
Altogether, four distinct categories of low cost airports are identified:
London Stansted, as a major low cost offer airport, with the largest number of low cost
operations accounting for nearly all take-offs at the airport
Small low cost airports with about 500 weekly take-offs, having about 80% to 90% of
low cost carrier take-offs (e.g. Berlin Schoenefeld)
Medium sized airports with around 800 weekly low-cost take-offs, accounting for 27%
to 67% of total take-offs (e.g. Barcelona)
Hub airports with about 500 weekly low cost carrier take-offs, having a share of about
10% to 27% of the total number of take-offs (e.g. Paris Charles de Gaulle)
Annual analyses of the European air transport market
Annual Report 2007
2008-12-02 Annual Report 2007
Page 120 Release: 2.2
Figure 3-5: Top 25 Low-cost carrier airports in Europe
Source: OAG 2007; third week in July 2007)
Number of Take-offs
0
1.000
2.000
3.000
4.000
5.000
6.000
London Stan
s
ted Apt
B
arc
el
on
a
Ap
t
Palma Mallorca
Lo
n
do
n
G
atw
i
ck Apt
Du
bl
i
n
Cologne/Bonn K.A.
A
pt
Manch
es
ter
I
ntern
at
ional Apt
London Lu
t
on Apt
B
erl
i
n
Te
gel
Ap
t
Mun
i
c
h
International Airport
Ams
terd
am
Stuttgart Airport
Du
ss
el
do
rf
I
ntern
ati
on
al
Ai
rpo
rt
Bi
rmi
ng
h
am
I
nternational Airp
o
rt
Edinb
u
rgh
M
adr
id
B
araj
as
Ap
t
Oslo Airport
Mal
ag
a
Paris Charles de Gaulle Apt
Hamb
u
rg Airp
o
rt
Berlin Schoenefeld Ap
t
B
elfas
t In
tern
atio
n
al
Ap
t
Paris Orl
y
Apt
So
uth
amp
ton
Milan Ori
o
al
Ser
io Apt
Number of LCC-Take-offs Total Number of Take-offs
3.3 Freight
Freight comprises cargo carried as belly freight by passenger aircraft as well as by freighters. The
total volume of freight handled worldwide was 85 million tons in 2007. The top 20 freight
airports worldwide as displayed by Figure 3-6 are dominated mainly by Asian and US airports.
Nine of these airports are located in Asia, seven in the USA and only four of these are European
airports. The world’s largest freight airport is Memphis in the USA with 3.8 million tons of
freight handled, closely followed by Hong Kong International (3.7 million tons of freight). There
is a notable decline from the first two places to rank three; with the third-ranked airport Alaska
Ted Stevens Anchorage International in the USA having handled 2.8 million tons of freight in
2007. Total air freight figures range from 3.7 million tons at the airport of Memphis in the USA
to 1.2 million tons at Beijing Capital International in China. The top 20 airports handled almost
half (48%) of the worldwide freight volume in tons in 2007 and therefore air freight is more
concentrated on the top 20 airports than commercial passengers or aircraft movements. The
largest European air freight airports are Frankfurt/Main on place eight, closely followed by Paris
Charles de Gaulle. Amsterdam Schiphol and London Heathrow follow on places 13 and 18
respectively.
Annual analyses of the European air transport market
Annual Report 2007
Annual Report 2007 2008-12-02
Release: 2.2 Page 121
Figure 3-6: The 20 biggest airports in terms of commercial air freight worldwide
Source: ACI 2008
Freight (tons)
0
500.000
1.000.000
1.500.000
2.000.000
2.500.000
3.000.000
3.500.000
4.000.000
MEMPHIS INTL (USA)
HO
N
G KONG
I
N
T
L
(C
H
INA
)
A
N
CHO
R
A
G
E
AK TE
D
STEVENS (
U
SA
)
INC
H
EON
IN
TL
(KOR
EA
(REP OF
)
)
SHANGHAI PU
D
ONG IN
T
L
(CHINA
)
TOKYO NARITA INTL
(JAPAN)
L
OU
ISV
ILL
E
I
N
TL
(USA)
F
R
A
N
KF
U
R
T/
MA
I
N
(GER
M
A
NY)
PARI
S
CHARLES
DE
G
AULLE
(F
R
A
N
CE)
SIN
G
A
POR
E
C
HA
N
GI
(SINGA
POR
E)
MIAM
I
I
N
TL
(U
SA
)
L
OS
AN
GEL
ES
INT
L
(U
SA
)
A
MS
TER
D
AM
SC
H
IPH
O
L (
N
ETH
ER
L
A
N
DS)
TAIPEI TAO
YU
AN INTL
(
TAIPEI - C
H
INESE TAIPEI)
DUBAI I
N
TL (
U
NITED
ARAB EMIRATES)
N
EW
YO
R
K
J
OH
N
F. KEN
N
ED
Y
I
N
TL
(
U
SA
)
CH
I
CAGO IL O'HARE
IN
TL
(USA)
LONDON
H
EAT
H
R
O
W
(
UN
I
T
ED
KINGDOM)
B
A
N
G
KOK SU
VA
R
N
A
B
H
U
MI IN
TL
(
THA
IL
A
N
D)
BEIJING CAPITAL INTL (CHINA )
2007 2006
Figure 3-7 illustrates Europe’s top 20 freight airports. The total volume of freight handled at
European airports was 16.3 million tons in 2007. The largest freight airport in Europe is
Frankfurt/Main with 2.1 million tons of freight in 2007, followed by Paris Charles de Gaulle with
almost an equal amount of tonnes. Other large freight airports in Europe comprise Amsterdam
Schiphol with 1.6 million tons of freight on place three and London Heathrow with 1.3 million
tons of freight on place four. The remaining 16 airports are much smaller in terms of tons of
freight handled being below 1.0 million tons. Freight handled at European airports lies between
2.0 million tons for Frankfurt/Main and 0.134 million tons for Milan Orio Al Serio. In 2007, the
top 20 European airports handled 15% of the worldwide air freight volume in tons; in contrast
they handled 80% of the total freight at European airports. This again highlights the high
concentration on only a few airports in the European air freight market. However, most of the
air freight was handled at airports outside Europe in 2007, as their overall share is only 15%.
Marketshare in the World
48%
52%
Top 20 Airports
Other Airports
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Figure 3-7: The 20 biggest European airports in terms of commercial air freight
Source: ACI 2008
Freight (tons)
0
500.000
1.000.000
1.500.000
2.000.000
2.500.000
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3.4 Ground Handling
As IATA states, ground handling covers the complex series of processes required to separate an
aircraft from its load (passengers, baggage, cargo and mail) on arrival and combine it with its
load prior to departure. The IATA sets an international industry standard on ground handling
definitions in the Airport Handling Manual AHM 810. Even the definition of elements covered by
“Ground Handling” can be found in this standardised release.
Services that might be provided by order of an air carrier or fields of activity that are outsourced
could be:
Representation, administration and supervision
Passenger services
Ramp services
Load control, communications and flight operations
Cargo and mail services
Support services
Security
Aircraft maintenance
Marketshare in the World
15%
85%
Top 20 Airports
Other Airports in the World
Marketshare in Europe
80%
20%
Top 20 Airports
Other Airports in Europe
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A distinction can be made between airside and landside services, the latter being passenger-
related services such as ticketing and baggage handling at check-in desks. Airside services
comprise services such as ramp handling, fuelling and defuelling operations, aircraft
maintenance and the provision of catering services.
Ground handling services make an essential contribution to the efficient use of air transport
infrastructure. The market in ground handling services is covered by the Directive 96/67/EC
dating from October 1996 which gradually opened up the services to competition. This was
necessary since the checking-in of passengers, baggage handling, etc. used to be a monopoly at
many EU airports, and many airlines complained about the relatively high prices for the services
provided and sub-optimal efficiency and service quality.
Services mentioned above are offered by ground handling service providers which can be part of
the airport authority, a subsidiary of this or an independent company. The liberalisation process
led to an increased number of service providers for ground services and thus to a higher grade
of competition. The following tables give an overview of the contracts in a state of flux. All
contracts newly agreed in 2007 on European airports within the EEA are listed as published by
the “Ground Handling International Magazine”
4
. The list may give an overview of the market
and the services in more detail.
Ground service providers, which used to mainly be active behind the scenes, now have more
direct interaction with air passengers especially due to increased security checks. That is one
reason why the industry forced increases in staff training – recruitment becomes more difficult
locally and the knowledge level required is up too. In general, the industry’s profit is linked to
the health of airlines’ business but also affected by new industrial trends and requirements, for
example the need for environmental friendliness of apron vehicles. A key driver of economic
results seems to be the persistent growth of Low Cost Carriers. The high volumes of travellers
that those airlines bring along are very welcome with ground handlers because they make it
possible to expand at above the average market growth rate. Contrary to the first impression,
Low Cost Carriers “do not require low cost handling services”, but a strict punctuality because
of their fast turnarounds (GHI 2008).
4
Information is given on a voluntary basis and may be incomplete.
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Table 3-1: List of contracts awarded to Ground Handling Companies in 2007
Source: www.groundhandling.com
Handler Services provided Carrier Stations
aerogate Munchen passenger handling and ticketing Saudi Arabian Airlines Munich
ASIG cabin cleaning Sri Lankan Airlines London Heathrow
Aviance UK full ground handling Eastern Airways London Stansted
Aviapartner full ground handling Aer Lingus Lyon
Aviapartner full ground handling Austrian Airlines Lyon
Aviapartner full ground handling BA Lyon
Aviapartner full ground handling BA Marseille
Aviapartner full ground handling BA Nice
Aviapartner full ground handling BA Toulouse
Aviapartner full ground handling bmi Lyon
Aviapartner full ground handling British Regional Airlines Lyon
Aviapartner full ground handling City Airlines Lyon
Aviapartner full ground handling Lufthansa Marseille
Aviapartner ramp handling South African Airways Munich
Aviapartner full ground handling Spanair Lyon
Aviapartner full ground handling Thomas Cook Lyon
Aviapartner full ramp handling Various airlines Nice Cote d'Azur
Aviapartner cargo handling Finnair Amsterdam
Aviapartner cargo handling Finnair Brussels
Aviapartner cargo handling Finnair Paris CDG
Aviapartner catering services Jet Airways Brussels
CSA Czech Airlines full ground handling Lufthansa Prague
Fernley aircraft cleaning Oman Air London Gatwick
Fernley aircraft cleaning Sterling London Gatwick
Fernley aircraft cleaning & de-icing Tui London Gatwick
Flightcare Belgium passenger and cargo handling Albanian Airlines Brussels
Flightcare Belgium cargo handling Asiana Cargo Brussels
Flightcare Belgium ground handling Freebird Brussels
Flightcare Belgium passenger and cargo handling Jet Airways Brussels
Flightcare Belgium passenger and cargo handling KD Avia Brussels
Flightcare Belgium cargo handling Royal Jordanian Brussels
Flightcare Belgium cargo handling Tarom Brussels
Flightcare Belgium ground handling TNT Brussels
Flightcare Belgium passenger and cargo handling US Airways Brussels
Fraport Cargo Services document and cargo handling Emirates SkyCargo Frankfurt
Fraport Cargo Services cargo handling Inter Airlines Frankfurt
Fraport Cargo Services cargo handling Pegasus Airlines Frankfurt
Gate Aviation Services packing & loading of inflight catering easyJet Various UK airports
Goldair ramp & passenger services Air France Athens
Groundforce full ground handling Air Transat Madrid
Groundforce full ground handling Alitalia Bilbao
Groundforce full ground handling Brit Air Bilbao
Groundforce full ground handling Jet2.com Gran Canaria-Gando
Groundforce full ground handling Jet2.com Tenerife Norte
Groundforce full ground handling Jet2.com Tenerife Sur
Groundforce full ground handling Korean Air Madrid
Groundforce full ground handling Regional Air Lines Seville
Groundforce full ground handling & lounge services Royal Air Maroc Various Portuguese airports
Groundforce full ground handling SunExpress Various Portuguese airports
Groundforce full ground handling TAP Portugal Bilbao
Groundforce full ground handling Top Fly Tenerife Sur
Jet Aviation full ground handling Belair Zurich
Jet Aviation check-in, gate, ramp, baggage, tickets British Airways Geneva
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Handler Services provided Carrier Stations
Jet Aviation check-in, gate, ramp, baggage, tickets British Airways Zurich
Jet Aviation check-in, gate, ramp, baggage, station control Hello Geneva
Jet Aviation check-in, gate, ramp, baggage, station control Hello Zurich
Menzies ramp & cargo handling Air China Manchester
Menzies ramp handling Emirates Skycargo Prague
Menzies cargo handling Martinair various Irish airports
Menzies cargo handling & trucking MNG Airlines Various UK airports
Menzies Aviation ground handling easyJet London Gatwick
Menzies Aviation ramp, cargo and trucking Great Wall Airlines London Heathrow
Menzies Aviation ramp, cargo and trucking Great Wall Airlines Manchester
Menzies Aviation ramp & cargo handling and trucking Jett8 Airlines Cargo London Heathrow
Menzies Aviation ramp & cargo handling and trucking Jett8 Airlines Cargo Manchester
Menzies Aviation full ramp handling KLM Bucharest
Nordic Aero passenger, baggage and ticketing Air Berlin Stockholm Arlanda
Nordic Aero passenger,baggage and de-icing easyJet Copenhagen
Nordic Aero de-icing and ground handling Qatar Airways Stockholm Arlanda
Olympic Airways full ground handling Aerosvit various stations
Olympic Airways full ground handling Alitalia various stations
Olympic Airways full ground handling British Midland various stations
Olympic Airways full ground handling Egyptair various stations
Olympic Airways full ground handling El Al various stations
Olympic Airways full ground handling SkyEurope various stations
Penauille Servisair full ramp handling easyJet Liverpool
Penauille Servisair full ground handling Silverjet London Luton
Plane Handling cargo handling Libyan Arab Airlines London Heathrow
Plane Handling cargo handling Libyan Arab Airlines Manchester
SAS Ground Services passenger and ramp handling Air France & KLM Aberdeen
SAS Ground Services full ground handling Icelandair Bergen
SAS Ground Services full ground handling Icelandair Gothenburg
SAS Ground Services full ground handling Icelandair Oslo
SAS Ground Services full ground handling Icelandair Stockholm Arlanda
SAS Ground Services ground handling Malaysian Airlines London Heathrow
SAS Ground Services full ground handling Mytravel Bergen
SAS Ground Services full ground handling Mytravel Malmo
SAS Ground Services full ground handling Mytravel Stavanger
SAS Ground Services full ground handling Turkish Airways London Heathrow
Servisair ramp & passenger handling Saudi Arabian Airlines Manchester
Servisair ground handling Thompsonfly Various UK airports
Servisair Cargo cargo handling Air Seychelles Paris CDG
Servisair Cargo cargo handling and warehousing Royal Jordanian Airlines London Stansted
Servisair Cargo cargo handling TAM Paris CDG
Servivisair Cargo trucking, cargo handling & towing Zoom Airlines Paris CDG
Swissport ground handling easyJet Basel Mulhouse Freiburg
Swissport ramp handling easyJet Zurich
Swissport ramp, balance, catering and pax services Various airlines Sofia
Swissport/Menzies full ground handling Air Berlin Madrid
Swissport/Menzies full ground handling easyJet Madrid
Swissport/Menzies full ground handling First Choice Alicante
Swissport/Menzies full ground handling First Choice Almeria
Swissport/Menzies full ground handling FlyBe Alicante
Swissport/Menzies full ground handling Lufthansa/SWISS Madrid
Worldwide Flight Services cargo handling El Al London Heathrow
Worldwide Flight Services cargo handling Silverjet London Luton
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4 Air Transport Forecasts
For the air transport sector, statements on the future development are required for various
purposes. For this reason, aircraft manufacturers regularly publish forecasts which are the basis
for estimation of aircraft or component requirements for the forthcoming 20 years. Studies on
the future development are also essential for strategic planning of the air traffic infrastructure
(airports and air traffic control) and also the quantification of potential environment impacts
induced by air transport. On the one hand, in this chapter some selected, recently published
forecasts of worldwide air traffic are presented in order to give an impression of the potential
overall air traffic development. On the other hand, short, medium, and long-term prognoses of
the European air traffic are discussed. These forecasts are provided by the European organisation
for the safety of air navigation, Eurocontrol.
4.1 Global Forecasts
As already mentioned, forecasts are published by aircraft manufacturers for the purpose of
estimating upcoming aircraft requirements. The most well-known prognoses are the Global
Market Forecast provided by Airbus and the Current Market Outlook by Boeing. But also the
engine manufacturer Rolls-Royce, the regional jet manufacturers Bombardier and Embraer, and
the Japan Aircraft Development Corporation regularly publish requirement prognoses for their
products. The comparative consideration of the prognoses’ central key values in terms of
economy growth and growth of passenger and freight-carrying traffic reveals similar values (see
Table 4-1). Thus, the forecasts published by Boeing, JADC, Bombardier and Embraer assume an
average worldwide GDP-growth rate between 3.0 and 3.2%. According to the outcome of the
demand forecast, yearly average growth rates between 4.7 and 5.0% for passenger-carrying
and approx. 6% for freight-carrying traffic are indicated. Besides the manufacturer prognoses,
aviation industry associations and organisations publish forecasts, for example the International
Civil Aviation Organization (ICAO), International Air Transport Association (IATA) and Airport
Council International (ACI). Whereas the comparable forecasts performed by ICAO and ACI,
which refer to the time horizon until 2025, are based on an average yearly growth of passenger
traffic between 3.6% (ACI) and 4.1% (ICAO), the IATA-forecast, referring to a time span until
2011, indicates a passenger traffic increase of 5.1%.
Table 4-1: Comparison of important variables of different global forecast studies
Source: Various global forecasts
Publisher
Date of
publication
Time
horizon
GDP
Growth
Passenger
Growth
Pkm
Growth
Tkm
Growth
Airbus Market Forecast 2008 2007-2026 n.a. n.a. 4.9% 5.8%
Boeing Current Market Outlook 2007 2007-2026 3.1% 4.5% 5.0% 6.1%
Rolls-Royce Market Outlook 2007 2007-2026 n.a. 4.9% n.a.
Japan Aircraft Development Corporation 2007 2007-2026 3.1% n.a. 4.7% n.a.
Bombardier Aircraft Market Forecast 2007 2007-2026 3.2% n.a. n.a.
Embraer Market Outlook 2007 2007-2026 3.0% n.a. 4.9% n.a.
ICAO Outlook for Air Transport 2007 2025 3.5% 4.1% 4.6% 6.6%
ACI Global Traffic Forecast 2007 2006-2025 n.a. 3.6% n.a. n.a.
IATA Passenger Forecast 2007 2007-2011 n.a. 5.1% n.a. n.a.
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In Figure 4-1 the development for the forecast period up to 2025 is displayed. The exponential
future growth becomes obvious.
The Airbus-method of traffic forecast applies the „Bottom-up-Approach“, using traffic models
of approx. 140 different markets. These models take into account variables like development of
economy, structural features like availability of Low Cost Carriers or capacity problems, de- and
re-regulation plans in developed markets or in third world countries etc. All in all, the recent
forecast - published at the beginning of 2008 - gives an average growth of the worldwide traffic
performance of 4.9% per year in the time frame 2007 to 2026.
Figure 4-1: Comparison of the passenger kilometres development of different global forecast studies
Source: Airbus 2008, Boeing 2007, ICAO 2007, DLR calculationss
ICAO 2007
Airbus 2008
Boeing 2007
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2005 2010 2015 2020 2025
billion pax-km pa
The Boeing’s Current Market Outlook, published in October 2007, gives a yearly increase in air
traffic of 5.0% (measured in passenger-kilometres, Pkm) in the long-term view from 2007 to
2026 and assuming a growth of the world economy of 3.1% on average. Consequently,
worldwide air traffic is expected to grow from 4,238 billion PKM (2006) by the coefficient 2.7 to
a volume of almost 11,346 billion Pkm until the year 2026.
When considering the regional spread of global passenger transport (see Figure 4-2), significant
differences in growth extents can be seen. Thus, Airbus is expected to increase domestic
passenger transport in North America, a fairly mature market, by only 2.4% p.a. until 2026. In
contrary, in P.R. China the yearly growth of air traffic is assumed to be approx. 8.4%.
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Figure 4-2: Airbus Forecast of Passenger Traffic within and between several World Regions
Source: Airbus 2008
A more moderate forecast, referring to a time horizon until 2025, was published by ICAO in
2007. ICAO assumes an average yearly increase in passenger kilometres of 4.6% in the time
span 2005 to 2025. This yields traffic performance of 9180 billion passenger kilometres, based
on 3720 billion passenger kilometres in 2005, which approximately corresponds to a 2.5-fold
increase. As given in the Boeing-forecast, ICAO also assume a considerably different growth in
the individual world regions: Whereas the North American regions only grow moderately by
3.6%, likewise Europe by 4.3%, in the Asia-Pacific region and Middle East considerably
dynamical growth of approx. 5.8% is expected.
4.2 European Forecasts
Eurocontrol regularly publish forecasts of flight movements to be expected in Europe. In the
short-term prognosis, published half-yearly, the assumed number of flight movements in Europe
is given for the forthcoming year. The medium-term prognosis, published once per year, covers
a time horizon of seven years. The long-term prognosis (published in a 2 year period) displays
the conceivable modes of development by means of scenarios within a 20-year time frame. In
the following, the most essential benchmarks of the three recently published prognosis-series
are presented.
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4.2.1 Eurocontrol Short-Term Forecast September 2007
The short-term prognosis, published in September 2007, gives an overview of the performed
flight movements (according to IFR) in Europe (Eurocontrol ESRA) in 2007, and also of the
potential ones in 2008. Accordingly, a growth of 5.4% in total was assumed for 2007. In 2007,
according to current data, 9.7 million flight movements were performed. This corresponds to a
growth of 5.3% compared to the preceding year. Thus, the growth, assumed in the short-term
forecast for 2007, broadly complies with the actual development.
From 2007 to 2008, a growth of 5.5% is expected, allowing a forecast margin of 4.4 to 5.5%.
The expected growth considerably differs regionally, as already experienced in the past. Thus, in
the countries Germany, Belgium, the Netherlands, Sweden, Switzerland, the UK and Ireland,
growth rates between 4 and 5% are to be expected. In France the expected growth rate is
6.1%, in Spain 7.3% and in Italy 8.7%. Above average growth rates (between 12 and 15%) are
shown for the new EU members, the Czech Republic, Poland, Estonia, Latvia and Belarus. In
Turkey, Ukraine and Moldova, the expected growth rates amount to approx. 10%. For the
South European countries, the growth rate forecast considerably differs, but for the majority of
countries, high growth rates are forecasted. Eurocontrol solely assume relatively low growth
rates of 1.8 and 1.9% in the countries Sweden and Finland respectively.
Figure 4-3: Eurocontrol Flight-Forecast Growth Rates for 2008
Source: Eurocontrol 2007
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4.2.2 Eurocontrol Medium-Term Forecast 2007-2013
Within the scope of the medium-term prognosis, performed by Eurocontrol for the years 2007
to 2013, in addition to a Baseline-Scenario the development alternatives “high” and “low“ have
also been defined. Eurocontrol assume for the entire forecast period an average yearly growth
of 3.4% in the Baseline-Scenario, 4.2% in the High-Scenario and 2.6% in the Low-Scenario. In
the forecast year 2013, these growth rates would lead to 11.3 million IFR movements in the Low
, 11.9 million in the Baseline , and 12.6 million IFR movements in the High-Scenario. In the
decade 2003 to 2013, the total number of IFR movements would increase by approx. 36% in
the Low-Scenario, 43% in the Baseline-Scenario and 51% in the High-Scenario.
Table 4-2: Summary of the Eurocontrol Medium-Term Forecast
Source: Eurocontrol 2007
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Average Annual
Growth Rate
2006-2013
High 9915 10366 10823 11222 11685 12103 12558 4.2%
Baseline 8344 8745 9088 9438 9787 10125 10463 10816 11196 11571 11935 3.4%
Low 9668 9900 10160 10450 10734 11031 11327 2.6%
IFR Movements (Thousands)
When considering the individual countries, the assumption of relatively high yearly growth rates
in East Europe becomes obvious. This is probably due to the strongly growing economies of
these countries and their adaptation to the West European standard of living in terms of private
air travel. For the medium-term and beyond, in the “old” EU member states Eurocontrol expect
a moderate increase in flight movements (up to 4%). France and Norway participate to a low
extent, Spain and Ireland, however, above average, in the West European flight movement
increase.
Figure 4-4: Eurocontrol Medium-Term Forecast Baseline Scenario
Source: Eurocontrol 2007
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4.2.3 Eurocontrol Long-Term Forecast 2006-2025
In order to identify long-term development potential of air transport flight movement,
Eurocontrol biennially perform a scenario study which applies various expectations as to the
development frame of aviation. Thus, for the target year 2025, a spectrum of conceivable ways
of development with respect to flight movements are indicated. This development frame varies
between 15.5 and 18.9 million flight movements in 2025, starting from about 9 million flight
movements in 2005. This rate corresponds to an annual average growth of 2.7% or 3.7%
respectively. Referring to the absolute number of flights, this corresponds to a multiplier of 1.7
or 2.1, compared to the initial year. In all scenarios, stronger growth is assumed in the time span
until 2012 than in the years between 2012 and 2025. Among other reasons, this is due to
increasing saturation tendencies in the West European countries. Furthermore, in the East
European countries, the considerably dynamic growth seen during the last years will slow down.
Moreover, Eurocontrol emphasize the expected capacity-bottlenecks at European airports. In the
strongest growing scenario, in 2025, the number of flight movements is assumed to be approx.
15% below the theoretical value of a bottleneck-generating development.
Table 4-3: Summary of the Eurocontrol Long-Term Forecast 2005-2025
Source: Eurocontrol 2006
2003 2004 2005 2012 2015 2020 2025
Average Annual
Growth Rate
2005-2025
Traffic Multiple
2025/2005
Scenario A 12,376 13,895 16,502 18,858 3.7% 2.1
Scenario B 11,652 12,838 15,048 17,253 3.3% 1.9
Scenario C 8,344 8,745 9,088 11,652 12,524 14,729 16,944 3.2% 1.9
Scenario D 11,147 11,938 13,543 15,456 2.7% 1.7
IFR Movements (Thousands)
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5 Regulatory Developments
The civil aviation sector is an economic activity at global level, constantly faced with new
challenges. Because of additional demand for global mobility in 2007, the aviation sector
reached high growth rates all over the world.
This development is enabled by the increasing number of direct air services to international
destinations, e.g. non-stop flights between South America and the Middle East for the first time
in history. The respective States continued to liberalise their air services agreements with their
aviation partners around the world. Although full “open skies” are not granted everywhere, the
tendency is moving towards an expansion of air traffic between countries: for example, Canada
agreed greater flexibility for air services with Mexico and the Unites States of America expanded
their agreements with Argentina and China.
In addition, rapidly growing demand will lead to airport and airspace congestion in many parts
of the world and are already in many cases stretching air navigation and ground facilities to the
limit. The pressure will increase because air traffic is forecast to increase at an annual average
global rate of 5.8 per cent over the next three years. While increasing existing airport capacity
and creating new airport capacity, the traffic demand requires constant emphasis on safety to
ensure that the traffic can continue to grow without putting the travelling public at risk.
Aviation's impact on the environment consists of noise and local air quality as major problems
for the populations living around airports, and its emissions contribute to climate change.
To address these concerns, all stakeholders are continuing to work towards closer cooperation
at international, regional and local levels. In 2007, the 36
th
IACO Assembly took place in
Montreal with 179 participating Member States, 1488 delegates and 39 Resolutions to aim for a
further worldwide harmonisation in the aviation sector.
These different challenges and concerns are the global framework for the legislative and
regulatory developments in 2007 which will be considered in the following chapter.
5.1 International Aviation
International aviation relations are based on specific authorisations granting traffic rights. These
rights, granted by air services agreements between different states, give access to specific
routes, stipulate the exact number of airlines and flights and the points that can be served. Each
EU Member State has negotiated bilateral aviation agreements with third countries outside
Europe. Traditionally these agreements were based on national ownership.
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According to the “open skies” judgement of 5 November 2002 of the European Court of
Justice, bilateral aviation agreements concluded with the United States were discriminatory, a
breach of Community law. This case law also clarified that the Community has certain exclusive
responsibilities in external relations in the field of aviation which were traditionally governed by
bilateral air services agreements between EU Member States and third countries.
In recent years, the EU has developed a new European external aviation policy which aims at
restoring legal certainty and creating new economic opportunities by opening new markets for
competition and ensuring fair competition by promoting regulatory convergence in key areas.
This approach is based on three pillars:
All air service agreements of the EU Member States have to be amended to ensure that
they are in compliance with Community law. Bilateral air services agreements brought
into compliance since 2003 are available on the Commission website
5
.
By 2010, the creation of the Common Aviation Area shall be created by the Community
and its neighbours located along its southern and eastern borders to integrate these
aviation markets.
Through starting negotiations of comprehensive agreements with key partners, the EU
aims to develop new economic opportunities, to promote global investment
opportunities, and to ensure fair competition to produce positive effects for users and
operators while ensuring high levels of safety and security.
5.1.1 Horizontal Agreements
A horizontal agreement is an agreement negotiated by the Commission on the basis of a
mandate by EU Member States, aimed at bringing all existing bilateral air services agreements
between EU Member States and a specific third country in line with Community law. Compared
to bilateral negotiations this approach has the advantages of simplicity, cost-effectiveness and
speed because the Commission acts as the sole negotiating partner. The amended agreements
will guarantee the same rights to all Community operators based on the principles of non-
discrimination and freedom of establishment and ensure the legal certainty of aviation relations
based on such agreements. It has to be underlined that neither the volume nor the balance of
air traffic rights are affected by these amendments and will continue to be negotiated between
the partner State and EU Member States.
Since 2004, a total of 700 bilateral agreements have been brought into conformity with
Community law. More than 600 of these were brought into compliance with EU law through 36
horizontal agreements.
5
http://ec.europa.eu/transport/air_portal/international/pillars/doc/asa_table.pdf
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5.1.2 Bilateral Agreements
Direct negotiations between each EU Member State concerned and its partner is another
possibility to bring existing bilateral air service agreements of the EU Member States into
compliance with Community law by amending each bilateral agreement separately. Between
June 2003 and December 2007, the method of separate bilateral negotiations led to changes
with 53 partner States, representing 107 bilateral agreements corrected.
5.1.3 Common Aviation Area with the EU’s Neighbours
As a sectoral contribution to the EU's neighbourhood policy, the cooperation between the EU
and its partners located along its borders will continue to open the respective markets and
enhance regulatory cooperation and convergence to ensure high levels of safety and security as
well as other common standards.
5.1.3.1 European Common Aviation Area (ECAA)
Established in 2006 by the European Community and its Member States and also Norway,
Iceland and the countries of South-East Europe, the ECAA will bring together the EU and its
partners located along its south-eastern borders. The various parties will share the same market
operation rules concerning economics, air traffic management, safety and security and
environmental standards based on the full application of the European Community's aviation
law.
To provide information to countries which are willing to take on and implement EU law in the
field of aviation in order to benefit from ECAA, the Commission published a “Guide to
European Community legislation in the field of civil aviation”
6
in June 2007.
In February 2007, a study
7
concerning domestic reforms and regional integration in air transport
was published. The study reviews the status of development across the region, the provisions of
the ECAA and the reform implications for governments and donors. The annex contains
country-specific information on air transport. Furthermore, a second meeting of the ECAA Joint
Committee was held in December 2007 in Zagreb highlighting significant progress in the
integration through different transitional phases of the Western Balkans into the European
Community internal air transport market.
6
http://ec.europa.eu/transport/air_portal/international/pillars/common_aviation_area/doc/ecaa_handbook_
edition_2007.pdf
7
http://ec.europa.eu/transport/air_portal/international/pillars/common_aviation_area/doc/2007_02_09_see
_air_transport_en.pdf
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5.1.3.2 Euro-Mediterranean Aviation Agreements
Following the conclusion and successful implementation of the Euro-Mediterranean Aviation
Agreement with Morocco, the Council adopted in October 2007 a decision authorising the
Commission to open negotiations for global aviation agreements with Jordan. In addition the
Commission published a Communication on developing a Common Aviation Area with Israel
and requested a mandate from the Council to negotiate an Euro-Mediterranean aviation
agreement
8
. The objective is to ensure the harmonisation of regulatory standards and to allow
for market opening between the European Community and these two countries.
5.1.3.3 Russia
In March 2007, the Council reached political agreement on a proposal for a decision on the
signature and provisional application of an agreement on agreed principles concerning the
modernisation of the existing system of utilisation of the Transsiberian routes with Russia. The
agreement provides for the abolition of payments for overflights for Community carriers not
later than the end of 2013 and ensures that newly operated overflights by Community carriers
in the transition period until 2013 will be free of payments.
5.1.3.4 Ukraine
At the end of 2007, the European Union and Ukraine officially opened negotiations on a
Common Aviation Area agreement. The agreement is intended to strengthen the aviation
relationship between EU and Ukraine to open the respective markets and ensure high levels of
safety and security for the benefit of aviation industries and consumers. The final aim is to
integrate Ukraine to the single aviation market.
5.1.3.5 Black Sea and Caspian Sea Region
In October 2007, a second meeting of the Regional EU – Black Sea / Caspian Basin Expert
Working Group on Civil Aviation was held in Chisinau. Bilateral relations were strengthened
during the discussions concerning legal certainty of operations, the vision of a European
“Common Aviation Area” and the need to enhance levels of aviation safety and security,
notably through technical assistance projects and exchange of expertise.
A number of countries in this region are seen as next possible candidates to participate in the
European Common Aviation Area initiative.
8
http://ec.europa.eu/transport/air_portal/international/pillars/common_aviation_area/doc/israel/comm_en.p
df
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5.1.4 Global Agreements
Global agreements with key partner countries in the most dynamic world markets will aim to
achieve a comprehensive framework for the air transport industry and the travelling public. As a
completely new model of air transport agreement, global agreements follow the twin objectives
of market opening while ensuring fair competition and regulatory cooperation in matters such
as safety and security. These agreements help to reform international civil aviation by
establishing a common skies framework.
5.1.4.1 United States of America
After four years and eleven rounds of negotiation, a comprehensive first-stage air transport
agreement between the EU and the United States of America
9
was reached on 2 March 2007,
approved by the Council of EU Transport Ministers on 22 March 2007 and signed in
Washington on 30 April 2007. The agreement will be applied provisionally from the summer
season 2008 on, commencing on 30 March 2008.
In the field of market access, the agreement includes the designation of Community air carriers
and allows any EU or US airline to provide services between any city in the EU and in the US and
beyond the EU and the US towards third countries without any restrictions on pricing or capacity
(unlimited 3
rd
, 4
th
and 5
th
freedom rights). Concerning the 7
th
freedom right to operate flights
between the US and a third country without a requirement that the service starts or ends in the
EU, unlimited all-cargo rights and passenger rights to a number of non-EU European countries
are granted for EU airlines. In addition, for the first time EU airlines are allowed to participate in
US-government-financed air transportation (“Fly America”). Furthermore the agreement enables
EU airlines to qualify for antitrust immunity.
Furthermore, the agreement contains rights in the area of ownership, investment and control of
airlines, and establishes a close regulatory co-operation in fields such as safety and security,
competition, Government subsidies and environment. It also constitutes a Joint Committee to
review its implementation and regulatory co-operation.
Article 21 of the air transport agreement refers explicitly to the priority issues for second stage
negotiations which will start in May 2008: further liberalisation of traffic rights, additional
foreign investment opportunities, effect of environmental measures and infrastructure
constraints on the exercising of traffic rights, further access to government-financed air
transportation and provision of aircraft with crew. The strictly defined timescale and the
possibility to suspend rights underline the importance of reaching a second stage of agreement
in order to pursue the benefits of liberalisation on both sides of the Atlantic.
9
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The economic impacts of these developments concerning an Open Aviation Area between the
EU and the US have been investigated by a study
10
published at the beginning of 2007. While
the development of an Open Aviation Area will not be a linear process, the cooperation
between the EU and the US will generate significant economic benefits for both partners: the
potential traffic growth will create up to 26 millions of additional passengers and an increase in
cargo volume which will result in new direct and indirect jobs in the aviation sector. The
consumer surplus is estimated to be between € 6 and € 12 billion, while the increase of traffic
will require the creation of up to 80 000 new jobs on both sides of the Atlantic. As a direct
consequence of the new agreement, several airlines of Star Alliance, SkyTeam and oneworld
have filed an application with the US Department of Transportation seeking antitrust immunity
on transatlantic routings for their alliances. Some European network carriers immediately
announced that they would start services to the US departing outside of their home country (for
example Air France: London Heathrow – Los Angeles and BA Openskies: Paris - New York).
5.1.4.1.1 Passenger Name Record (PNR) Data Transmission to the USA
A new agreement was signed between the EU and the United States on the transfer of
passenger name record (PNR) data by air carriers to the US Department of Homeland Security
11
.
The agreement applies provisionally as for the date of signature (27
th
of June 2007). It replaces
the previous interim agreement of October 2006, which was due to expire on 31 July 2007. The
following 19 different PNR items are transferred:
PNR record locator code
Date of reservation/issue of ticket
Date(s) of intended travel
Name(s)
Available frequent flier and benefit information (i.e. free tickets, upgrade, etc.)
Other names on PNR, including number of travellers on PNR
All available contact information (including originator information)
All available payment/billing information (not including other transaction details linked to
a credit card or account and not connected to the travel transaction)
Travel itinerary for specific PNR
Travel agency/travel agent
Code share information
Split/divided information
Travel status of passenger (including confirmations and check-in status)
Ticketing information, including ticket number, one-way tickets and Automated Ticket
Fare Quote
All baggage information
10
http://ec.europa.eu/transport/air_portal/international/pillars/global_partners/doc/us/final_report_bah.pdf
11
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Seat information, including seat number
General remarks including OSI, SSI and SSR information
Any collected APIS information
All historical changes to the PNR listed in number 1 to 18
5.1.4.2 Canada
The Commission adopted a communication asking for a mandate to negotiate a comprehensive
aviation agreement
12
. In October 2007, the Council authorised the Commission to open
negotiations with Canada, aimed at establishing an Open Aviation Area between the EU and
Canada, opening market restrictions and achieving a high level of regulatory convergence.
The EU and Canada started negotiations on a broad aviation agreement in November 2007
13
.
5.1.4.3 China
While China is gradually seeking to open both its domestic and international markets to more
competition, the Commission requested a mandate in 2005 to establish a coherent framework
in which to develop comprehensive EU-China aviation relations in the future. Negotiations on an
EU-China horizontal agreement that will restore legal certainty to bilateral air services
agreements started in December 2005. Both parties are committed to concluding the agreement
as soon as possible.
5.1.4.4 India
In recent years, India’s air traffic market has been among the fastest growing in the world and
the country has taken decisive steps towards opening up its aviation market. With such a rapid
development, the Indian market is becoming a strategically important market for European
airlines, aircraft manufacturers and service providers. Following the first EU-India Aviation
Summit at the end of 2006 and the Joint Action Plan of 2005, broad-based dialogues and
discussions continued in 2007
14
to strengthen strategic partnership and cooperation in civil
aviation, in particular to achieve a horizontal agreement with India to restore legal certainty to
the bilateral air services agreements between India and EU Member States.
12
http://ec.europa.eu/transport/air_portal/international/pillars/global_partners/doc/canada/2007_01_09_co
mmunication_2006_0871_en.pdf
13
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N&guiLanguage=en
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5.1.5 International Civil Aviation Organisation (ICAO)
In order to strengthen the EU's relationship with ICAO, the European Commission established an
office in Montreal, which was officially inaugurated by Vice-President Jacques Barrot in June
2007.
The Council also adopted a decision authorising the Commission to open negotiations on an
agreement regarding aviation security audits/inspections and related matters between the EU
and the ICAO. To provide regular, mandatory, systematic and harmonised security audits in
order to monitor the application of Annex 17 (Security) to the Chicago Convention, both the
ICAO and the EU have acted in parallel in setting up their respective security programmes. This
means that the EU Member States are confronted with two monitoring systems for the same
issue. The aim of the agreement is to ensure better use of limited resources and to avoid
duplication of efforts. The agreement will seek significant reduction of audits to be carried out
by ICAO within the territory of the EU by recognising that most standards contained in Annex
17 are also covered by Regulation (EC) No 2320/2002
15
and that the Commission has a mandate
to conduct inspections in order to monitor EU Member States' compliance with this Regulation.
The EU and its Member States were also particularly active at the 36
th
triennial ICAO Assembly
(September 2007), where not less than 10 common European working papers were presented
covering all major aspects of environment, safety, air traffic management and external aviation
relations. The development of these papers was coordinated by the Commission and the
respective Presidencies. All European States acted along common lines throughout the
Assembly.
Figure 5-1: European Community Aviation Agreements
Source: DG TREN
15
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5.2 Internal market
Air transport has traditionally been a highly regulated industry, in which protected and
fragmented national aviation markets existed across Europe. In order to create a single market
for air transport, the EU internal air transport sector was deregulated in three stages in the
1990s. The internal market removed all commercial restrictions for stakeholders within the EU so
that prices have fallen dramatically. European policy has profoundly transformed the air
transport industry by creating the conditions for competitiveness and ensuring both quality of
service and the highest level of safety.
But the experience of the last decade has shown that some measures of the “third package”
consisting of Regulations (EC) No 2407/92, 2408/92 and 2409/92 of 23 July 1992 pertaining to
operating licences, the right to operate air services within the EU and the pricing of such services
are either not homogeneously applied or need to be clarified or revised.
To solve these problems, in July 2006 the Commission adopted a proposal to modernise and
simplify the Single Market legislation for aviation by concentrating the “third package” into one
Regulation
16
. It aims at increasing market efficiency, enhancing safety of air services and
improving passenger protection by ensuring a consistent application of EU legislation in all EU
Member States and a true level playing field for all EU airlines. By removing obsolete measures,
the application of the rules should be facilitated.
An intensive discussion was inspired by the Commission's proposal concerning issues including:
definitions, requirements for leasing by Community carriers, financial requirements for the
validity of an operating licence, provisions on intra-Community air services and provisions on
pricing. On 30
th
November 2007, the Commission welcomed the agreement, reached after less
than one year between the Council and the European Parliament on the proposal to modernise
the Single Market legislation for air transport
17
. It will be adopted by mid 2008.
5.3 Competition
5.3.1 State Aid
In 2005, the Commission adopted Communication C(2005) 312
18
concerning guidelines on
financing airports and start-up aid for new routes from regional airports to amend the
application of Articles 87 and 88 of the EC Treaty.
16
http://ec.europa.eu/transport/air_portal/competition/doc/acte_en.pdf
17
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=EN&guiLanguage=en
18
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According to these rules, several decisions by the Directorate-General Energy and Transport in
state aid cases were published in 2007
19
:
Pursuant to Article 88 (2) of the EC Treaty, the Commission has launched formal investigations
into suspected state aid cases to airports in Germany (Berlin, Dortmund, Lübeck), Finland
(Tampere) and France (Pau) and has sent invitations to submit comments.
The Commission declared granted state aids as compatible with Community law concerning
airports in Italy (Tortoli-Airbatax), in Germany (Memmingen, Augsburg, Kiel-Holtenau), in Estonia
(Tallinn), in Poland (Lodz, Rzeszow Jasionka Airport), in Sweden (Norrköpping) and in UK
(Newquay Cornwall Airport).
In March 2007, the Commission authorised reduced prices to passengers on domestic routes in
French Guiana due to their outlying location and their transport difficulties. In December 2007,
aid was given in line with Community law in Portugal for air transport in Madeira.
Concerning airlines, the Commission approved state aid granted by Cyprus for the restructuring
plan of Cyprus Airways. Also, start-up aids for airlines in Italy (Puglia, Grosseto) and Belgium
(Antwerp) respected Community law. Under investigation is the support of airlines at Alghero
Airport in Italy.
In several cases, the Commission was engaged in Greek State aid given to Olympic
Airways/Olympic Airlines. At the end of 2007, a formal investigation procedure was launched. In
September 2007, the Court of First Instance partially annulled the Commission decision on state
aid to Olympic Airways concerning non-payment of charges due to Athens Airport and VAT on
fuel and spare parts
20
.
According to the above-mentioned Communication, EU Member States amended their existing
schemes relating to State aid covered by these guidelines to conform to these rules by 1 June
2007.
5.3.2 Infringements
The Commission as the guardian of the EC Treaty is responsible for ensuring that Community
law is correctly applied and has therefore the option of commencing infringement procedure
against EU Member States.
Concerning air transport in 2007, several cases were brought before the Court of Justice
21
:
19
http://ec.europa.eu/dgs/energy_transport/state_aid/decisions/decisions_dg_tren_en.htm
20
http://europa.eu/rapid/pressReleasesAction.do?reference=CJE/07/56&format=PDF&aged=1&language=E
N&guiLanguage=en
21
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In order to guarantee a high and uniform level of safety in European civil aviation, Directive
2004/36/EC harmonises the rules and procedures for ramp inspections of landed third country
aircraft and the collaboration concerning this data. Following preliminary proceedings, the
Commission took Poland to the European Court of Justice in November 2007 for not having
properly transposed the Directive on the safety of third country aircraft using Community
airports. By June 2007, the Commission had already decided to take legal action against Greece,
Ireland, Italy and Luxembourg for not having communicated their national implementing
measures to transpose this Directive.
Because of discrimination between air passengers concerning airport tax levied at Malta
International Airport, the Commission decided to take Malta to the Court of Justice. The airport
tax is only levied on air passengers beginning an international journey from Malta airport, but
not levied if the passenger had started the journey outside Malta.
5.3.3 Merger
According to the EU Merger Regulation, the Commission prohibits the acquisition of Aer Lingus
by Ryanair because of expected monopoly on routes to/from Ireland harming consumers
22
.
Various remedies to solve the competition issues were rejected.
Other airline mergers in the European Union, namely Flybe – BA Connect, easyJet – GB Airways,
Air Berlin - LTU and Air France-KLM – VLM were approved by national authorities. These
mergers were not hindered by the application of European competition law.
5.4 Distribution Networks (CRS)
Computerised reservation systems (CRS), also known as global distribution systems (GDS), are
distribution networks in the air transport market. These systems act as technical intermediaries
between the airlines and the travel agents and are used by travel agents to find up-to-date
information of flights and their availability, to compare prices and to make immediate confirmed
reservations on behalf of their customers. There are currently three major CRS providers active
on the European market with which about half of all bookings are completed: Europe's
Amadeus and the American companies Sabre and Travelport.
In 1989, Council Regulation (EEC) No 2299/89
23
, last amended in 1999, established a Code of
Conduct for CRSs that offer their services in the EU. It was designed in a market context in
which the vast majority of airlines bookings were made through CRSs via travel agents, being
the only information source and distribution channel. This strong market position implies the risk
22
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of competitive abuse, especially in the case of vertical integration of a CRS owned by an airline
called “parent carrier”. General competition rules were not sufficient and specific ad hoc rules in
the form of a Code of Conduct were necessary to ensure fair competition between air carriers
and between CRSs in order to protect the interests of consumers by displaying all available air
services in a non-discriminatory way on the travel agencies' computer screen.
In the last years, technology and economics have changed. Through airlines' websites and call
centres, other distribution channels are offered to consumers. So many airlines have divested
their CRS ownership. Three airlines only hold minority shareholdings in Amadeus, for example.
Low cost carriers mostly do not use the services of the CRSs. This rapid development of
alternative and less costly booking channels leads to a changed market situation resulting in
some inconsistency concerning the Code of Conduct for CRS.
To guarantee a non-discriminatory access to the services, the present Regulation restricts the
possibility of differentiations for airlines in offered content for different CRSs and fixes booking
prices excluding price competition. This intervention in negotiation freedom inhibits flexible
handling for the needs of airlines and travel agents and leads to high distribution costs which
make more cost-effective alternative channels even more attractive.
Because of these problems, the Commission initiated a large consultation process for
stakeholders examining a possible revision of Regulation (EEC) No 2299/89:.Between 23
February 2007 and 27 April 2007 an open internet consultation was held, followed by a
meeting on 2 May 2007 in Brussels in order to give a short overview of the contributions. The
results of this process are available for the public
24
.
On 15 November 2007, the Commission published a Proposal for a Regulation of the European
Parliament and of the Council on a Code of Conduct for computerised reservation systems
25
.
The proposal aims to significantly simplify the Code of Conduct and to reinforce competition
between the CRS providers while maintaining safeguards against competitive abuse, besides
consumer protection and the promotion of rail transport in CRS displays. In detail, the following
measures are planned:
The revised rules introduce negotiating freedom into the CRS market so that CRSs and
airlines will be free to agree the booking fees charged by the reservation systems and the
data content provided by the airlines. More competition will contribute to higher
efficiency in the sector in terms of price and service quality.
Maintained safeguards should protect against competitive abuse and discrimination by
airlines which own or control CRSs. These “parent carriers” have to ensure the supply of
neutral information to consumers. Due to Article 2 lit. g) and h) “parent carrier” is any
24
http://ec.europa.eu/transport/air_portal/consultation/2007_04_27_en.htm
25
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carrier which owns or effectively controls a CRS, while effective control means the
possibility of directly or indirectly exercising a decisive influence on an undertaking.
The provisions should guarantee an unbiased presentation of travel options as well as
the display of all applicable air fares to ensure neutral, transparent and comprehensive
information for customers. Regarding consumer protection, the new Code of Conduct
also provides protection of personal data.
Finally, the proposal allows rails companies integrated into an air transport CRS pricing
freedom in negotiating booking fees. This non-discriminatory treatment gives the
possibility to agree a better relation to the value of the mostly cheaper rail-tickets and
expand the rail service offers in air transport CRSs.
In line with the codecision procedure, the proposal will now be scrutinised by the European
Parliament and the Council.
5.5 Consumer Protection
5.5.1 Passenger Rights in the European Union
Regulatory developments concerning Regulation (EC) 261/2004 are described in chapter 7
concerning consumer issues.
5.5.2 Persons with Reduced Mobility
On 26 July 2007, the provisions of Articles 3 and 4 of Regulation (EC) No 1107/2006 of the
European Parliament and of the Council concerning the rights of disabled persons and persons
with reduced mobility when travelling by air
26
entered into force to offer persons with reduced
mobility non-discriminating access to air transport.
Even though there are genuine and voluntary efforts by most airlines and airports to offer the
necessary assistance, these measures are not free-of-charge everywhere and area-wide available.
In general, this Regulation gives persons with reduced mobility four basic rights when they use
air transport: accessibility, non-discrimination, assistance and information.
In accordance with article 18 (2) of the Regulation, Articles 3 and 4 have applied since July 2007
concerning equal treatment of persons affected by reduced mobility. The provisions prohibit the
refusal of carriage or to take bookings on the basis of reduced mobility of the disabled or the
elderly by an air carrier or its agent or a tour operator for flights from airports in the EU. Some
strict exceptions are described in Article 4 of the Regulation which can be made only for duly
justified safety reasons and which result in duties to supply information.
26
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In accordance with article 14 (1) of the Regulation, National Enforcement Bodies established by
the EU Member States have to ensure that the provisions are applied on their territory. A current
list of the different National Enforcement Bodies overseeing the application of the common rules
is updated by the Commission
27
.
As part of the successive implementation of the Regulation, the two other areas of the
Regulation, which will enter into force in July 2008, will allow free-of-charge assistance in all EU
airports as well as on board of planes taking off in the EU.
5.5.3 Misleading Airline Ticket Websites
On 14 November 2007, the results of an EU-wide investigation against misleading advertising
and unfair practices on airline ticket selling websites were presented to the public
28
. 15 EU
national authorities plus Norway, under coordination of the European Commission, investigated
websites of leading airlines, low cost carriers and other websites selling airline tickets. The results
show that in this highly digitalised market, price indications, contract terms and clarity of
proposed conditions have to be improved as they breach EU consumer protection law. Followed
by an enforcement phase, the national authorities will ask the companies to comply with current
law for national cases, while in cross border cases assistance is given by other authorities via CPC
(Consumer Protection Co-operation Network). Four months' notice is given for these
improvements. In case of unchanged behaviour, possible follow-up measures can include
imposing fines or closing down websites.
5.6 Air Traffic Management
The Single European Sky (SES) initiated by the Commission is intended to change the future
structure of air traffic management (ATM) across Europe to meet future capacity and safety
needs and to solve the problems of delays and the repercussions for users and airlines. The
growing air traffic requires a reinforcement of the framework for safety regulation and safety
management. So SES should organise airspace and air navigation at a European rather than at a
local level as ATM provides, together with airports, the infrastructure for the air transport
system.
27
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5.6.1 Single European Sky (SES)
In December 2007, the Commission presented a first report on the implementation of the Single
Sky legislation
29
according to Article 12 (2) of the Framework Regulation
30
adopted as one of
four regulations which brought air traffic management under Community supervision in 2004.
A growing air transport industry with more and more participants needs a high performance
ATM system to face the considerable increase in traffic by 2020 and the threatening capacity
crunch. Despite deficiencies concerning ageing technology, cost-effectiveness and the absence
of competition resulting in a lack of investment and modernisation, all causing unnecessary
flight length and the ensuing environmental impact, the Commission has pointed out many
achievements in the process of harmonising air navigation service provisions:
- A legal and institutional framework guarantees cooperation between EU Member States,
Eurocontrol and the industry.
- To ensure safety, separation of air navigation service providers from regulatory bodies has been
established parallel to the certification of service providers since June 2007 in accordance with
Regulation (EC) No 2096/2005
31
.
- The adoption of Regulation (EC) No 1315/2007 on safety supervision in air traffic
management
32
stipulates the national supervisory authorities' responsibility to oversee the air
navigation service providers.
- A higher level of interoperability has been imposed by adopting Regulation (EC) No 633/2007
and Regulation (EC) No 1265/2007. The former lays down requirements for the application of a
flight message transfer protocol for the purpose of notification, coordination and transfer of
flights between air traffic control units
33
. The latter stipulates requirements on air-ground voice
channel spacing for the Single European Sky
34
as implementation rules specifying the general
framework of the Single European Sky legislation in detail.
In the second quarter of 2008, the Commission will publish a legislative proposal for a second
Single Sky package, the extension of EASA competencies, especially to expand EASA's scope to
the safety of aerodromes, air navigation services and air traffic management, and the SESAR
master plan to pursue the construction of the Single European Sky.
Further initiatives of the Commission will also contain many of the ten recommendations made
by the High Level Group on the future aviation regulatory framework
35
presented in July 2007.
29
http://ec.europa.eu/transport/air_portal/traffic_management/ses_review/doc/2007_0845/comm_2007_0
845_en.pdf
30
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2004:096:0001:0008:EN:PDF
31
http://europa.eu/eur-lex/lex/LexUriServ/site/en/oj/2005/l_335/l_33520051221en00130030.pdf
32
http://ec.europa.eu/transport/air_portal/traffic_management/ses/doc/l_29120071109en00160022_en.pdf
33
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:146:0007:0013:EN:PDF
34
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:283:0025:0036:EN:PDF
35
http://ec.europa.eu/transport/air_portal/hlg/doc/2007_07_03_hlg_final_report_en.pdf
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Welcomed by the industry, the report prepared the revision of the single European sky
legislation and developed a roadmap containing concrete measures on how to boost
performance of the air traffic management system. The work of this group will make a decisive
contribution to the progress on the Single Sky in 2008.
5.6.2 Functional Airspace Blocks (FABs)
As a key element for the success of the SES, the Commission published a mid-term status report
concerning building the Single European Sky through functional airspace blocks (FABs)
36
in
March 2007.
As airspace is a common resource and as air traffic control (despite liberalisation in the aviation
industry as a single sector) is organised and operated at a national level, this fragmentation has
to be improved by the integration across existing national borders through functional airspace
blocks (FABs) based on operational requirements (e.g. traffic flows). Therefore, the Commission
pursues a policy to create larger airspace blocks working as one single operational entity. This
policy aims to enhance current safety standards and efficiency, to optimize the growing capacity
requirements, to minimise delays and to lower the costs of air traffic services.
According to Article 5 (4) of Regulation (EC) No 551/2004 the “bottom-up approach” stipulates
the responsibility of EU Member States to reach the necessary institutional agreements to
reconfigure the upper airspace into FABs. So, discussions have started in all EU Member States
and most of the initiatives are in the analysing feasibility phase now
37
.
In addition to assistance provided in this early phase, the Commission will assess the progress
concerning the establishment of functional airspace blocks through EU Member States and the
benefit of the “bottom-up approach” by the end of 2008. If needed, the current legislative
framework could be amended.
5.6.3 SESAR
The SESAR project is the European air traffic control infrastructure modernisation programme
and constitutes the technological element of the Single European Sky. It will combine
technological, economic and regulatory aspects to develop the new generation of air traffic
management systems and will use the Single European Sky legislation to synchronise these
plans.
The programme consists of three phases: First of all, the Definition Phase (2004-2008) will
deliver an ATM master plan defining the content, the development and the deployment plans of
36
http://ec.europa.eu/transport/air_portal/traffic_management/doc/com_2007_101_en.pdf
37
See Annex I of COM (2007)101
http://ec.europa.eu/transport/air_portal/traffic_management/doc/com_2007_101_en.pdf
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the next generation of ATM systems. Followed by the Development Phase (2008-2013), the
project will generate new technological systems and components according to the Definition
Phase. Finally, the Deployment Phase (2014-2020) will seek to build the new infrastructure in a
wide scale under the responsibility of the industry.
On 27 February 2007, SESAR Joint Undertaking consisting of the European Community and
Eurocontrol as founding members and public and private companies were created by Council
Regulation (EC) No 219/2007 on the establishment of a Joint Undertaking to develop the new
generation European air traffic management system (SESAR)
38
. This legal entity will manage the
following Development Phase of SESAR, will coordinate and concentrate all relevant research
and development efforts undertaken by its members and it will be responsible for the
implementation of the ATM master plan which is the final result of the SESAR Definition Phase.
The Joint Undertaking was set up under Article 171 of the Treaty establishing the European
Union and shall cease to exist after 8 years.
In its meeting of October 2007, the Administrative Board appointed Mr. Patrick Ky as the
Executive Director of the SESAR Joint Undertaking. The Executive Director is responsible for the
day-to-day management of the Joint Undertaking and is its legal representative.
After invitations to become members of the SESAR Joint Undertaking, talks with a group of pre-
selected candidates were initiated. In March 2007, the Commission published a Communication
concerning the state of progress of the project to implement the new generation European air
traffic management system (SESAR)
39
, in particular to report on the industry's participation in
the project development phase.
At the beginning of 2007, Deliverable 2 Report (D2) defining market requirements and an
agreed set of challenging requirements for future business needs was discussed until March,
when the Feedback Report
40
was made public by SESAR Consortium. In September 2007, the
Deliverable 3 Report (D3)
41
concerning ATM Target Concept was published as a response to the
performance requirements set in D2. This report forms the Third Milestone Deliverable of the
SESAR Definition Phase followed by the Feedback Report
42
in December 2007. As a basis for
further developments of the SESAR project, it consists of a concept of operations, architecture
for future ATM systems, an outline of total cost and a selection of a viable solution. Work will be
continued on the fourth milestone summarized in the Deliverable 4 Report (D4) concerning the
selection of best deployment scenario.
38
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:064:0001:0011:EN:PDF
39
http://ec.europa.eu/transport/air_portal/sesame/doc/0315_comm_sesar_en.pdf
40
http://www.sesar-
consortium.aero/mediasandfiles/File/05_docs/SESAR_D2%20Feedback%20Report_final.pdf
41
http://www.sesar-consortium.aero/mediasandfiles/File/05_docs/NewSesar3ForWeb_SESAR3.pdf
42
http://www.sesar-consortium.aero/mediasandfiles/File/05_docs/SESAR_D3FeedbackReport_Final_V3.pdf
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5.7 Airports
After liberalising the access to the air transport market until 1992, the Commission took further
measures in the following years concerning connected parts of air transport. The allocation of
slots and the ground handling segment were regulated, for example.
5.7.1 “Airport Package”
At the beginning of 2007, the Community airports came into the focus of the Commission
through a landmark regulatory package to promote efficient airport operations and the optimal
use of scarce capacity
43
.
This package focuses on the role of airports in the further development and competitiveness of
the European internal aviation market and will mark the future of airport regulation in Europe by
ensuring regulatory convergence between EU Member States.
5.7.1.1 Airport Charges
As a key part of the so called "Airport Package", the Commission published a proposal for a
Directive of the European Parliament and of the Council on airport charges
44
on 24 January
2007.
The proposal aims to set common principles for the levying of airport charges at Community
airports. It should re-define the relationship between airport operators and airport users by
requiring the following basic rules which are limited to the definition of a minimum of rules to
be respected when charges are adopted. The provisions do not fix a particular charging system
and are in line with ICAO settings:
- user-consultation (Article 4 of the proposal): the airport managing body and the air carriers
serving the airport should exchange their opinions concerning the charging system at an airport
which is going to be established or modified.
- transparency (Article 5 of the proposal): to facilitate the dialogue, each side has to provide
information concerning among other things a list of provided services and infrastructure, the
method of calculation and an overall cost structure of the airport through the airport managing
body and the air carriers´ forecasts, developments and requirements in the future.
- non-discrimination (Article 3 of the proposal): airport charges should not discriminate among
airport users or air passengers.
- independent national regulatory authorities (Article 10 of the proposal): each Member State
has to designate an authority which has to ensure that the provisions of this Directive are
implemented and used in a correct way.
43
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N&guiLanguage=en
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In line with the codecision procedure, on 21 November 2007, the European Parliament's
Committee on Transport and Tourism held a vote on the Directive's proposal at first reading.
The Council reached a general approach on the Directive's proposal at its 2835
th
Council
meeting.
But there is still a need for discussion on topics including the following:
- Scope of the Directive: two different thresholds subject to the dimension of the airport's
annual traffic are being discussed.
- Modulation of charges for environmental and other matters of public interest: Article 3 of the
proposal concerning non-discrimination should put the EU Member States in a position to
stimulate the use of environmentally-friendly aircraft.
- Implementation: while the Commission suggests a limit of 18 months for implementation into
national law, the Council favours an extension up to 36 months.
5.7.1.2 An Action Plan for Airport Capacity, Efficiency and Safety in Europe
On 24 January 2007, the Commission also presented a communication concerning an action
plan for airport capacity, efficiency and safety in Europe
45
. While congestion in the air should be
solved by SES, airport capacity involving runways and ground infrastructure will become a
constraining factor on air transport due to the gap between capacity and demand. Because of
the threat to safety, efficiency and competitiveness, a coherent strategy for tackling congestion
at European airports is initiated by legislative proposals, financial support and the promotion of
more co-ordinated planning.
Following the expressed need for co-ordinated actions during consultations of stakeholders, the
Commission published five principal measures which aim to accommodate traffic growth in an
environmentally sustainable manner:
- To optimise the use of existing capacity, air traffic flow management between airport slots and
flight plans should work in a more consistent way. A harmonized airport capacity and
assessment methodology tool should be developed in cooperation with Eurocontrol to establish
an inventory of existing/planned capacity. These developments are monitored by a supervisory
body on airport capacity.
- To provide a coherent approach to air safety operations at aerodromes, the responsibilities of
EASA should be extended to aerodrome safety regulation.
- To promote “co-modality”, the integration and collaboration of the transport modes is
supported.
- To improve the environmental capacity of airports and the planning framework of new airport
infrastructure, the existing rules are to be assessed and recommendations on best practice
guidelines for a balanced approach between airport plans and land-use policy is to be
developed.
45
http://ec.europa.eu/transport/air_portal/airports/doc/2007_capacity_en.pdf
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- Funded projects developing cost efficient technological solutions are to be implemented.
In October 2007, both the Council
46
and the European Parliament, adopting a non-legislative
resolution
47
, welcomed the plan of action and supported further measures, while underlining
the need for a masterplan for enhanced airport capacity and a coordination with other relevant
programmes.
5.7.1.3 Ground Handling Market
The ground handling market which consists of the landside (for example check-in and baggage
handling) and the airside (e.g. maintenance, fuelling, catering) services are an important
partition in the complex air transport business.
In October 1996 there was the liberalisation of the ground handling market at Community
airports by Council Directive 96/67/EC which was to provide a basis for unhampered access to
the market, aiming for more competition and reduced costs.
In accordance with article 22 of the Council Directive and within the regulatory package for
airports, the Commission published a report on the application of Council Directive 96/67/EC on
ground handling on 24 January 2007
48
.
This report is the basis for close dialogue between the Commission, the Council and the
European Parliament. As part of a revision concerning the simplification and clarification of the
text, a future proposal could aim to provide for further liberalisation of the market and regulate
current issues which have occurred since the application of the Directive.
This first report demonstrates the positive effects that the initial phase of liberalisation has had
on opening up access to ground handling markets at European airports to competition and
could be a contribution to solving the capacity problems at congested airports. On the other
hand, social issues have to be respected concerning working conditions and wage structure, in
order to ensure a high safety level.
In accordance with article 1 (4) of the Council Directive, the Commission has to annually publish
a list of Community Airports at which the ground handling market must be opened in
conformity with the relevant provision of the Directive. The current list was published on 16
November 2007
49
.
46
http://europa.eu/rapid/pressReleasesAction.do?reference=PRES/07/203&format=PDF&aged=1&language
=EN&guiLanguage=fr
47
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+TA+P6-TA-2007-
0433+0+DOC+XML+V0//DE
48
http://ec.europa.eu/transport/air_portal/airports/doc/2007_groundhandling_en.pdf
49
OJ C 275, 16 November 2007, Notice No. 2007/C 275/06
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5.7.2 Slots
Because of growing air traffic demand during the last decades and lacking airport capacities,
there are many congested airports which cannot offer enough landing and take-off possibilities
(“Capacity Crunch”).
Although only the enlargement of airport infrastructure can solve the lack of airport capacity in
the longer term, a coordinated slot allocation should lead to an efficient use of slots in a short
and middle-term. Therefore, the Council adopted Regulation (EEC) 95/93, amended by
Regulation (EC) 894/2002 and Regulation (EC) 793/2004, to grant a neutral, non-discriminatory
and transparent allocation, also regarding new entrants in the market.
On the basis of consultation with EU Member States, national authorities and stakeholders
beginning on 23 January 2007 and in accordance with article 14a (1) of Regulation (EC)
793/2004 on common rules for the allocation of slots at Community airports, the Commission
adopted a Communication on the application of this regulation on 15 November 2007
50
.
All stakeholders reflected that the regulation has achieved some improvements for a more
efficient use of scarce airport capacity, although it is almost impossible to quantify the
improvements. Nevertheless, some problems still exist and further improvements are necessary:
- New entrants, whose difficult definition in the regulation leads to different interpretations,
were only able to obtain a few slots at congested airports so that these rules seem to have only
a limited effect on competition. Furthermore, the strict new entrant status limits the amount of
slots under these rules and avoids a competitive network-infrastructure.
- Local rules can add more flexibility during the process of slot allocation if they are in line with
Community law. The possibility of introducing local guidelines depending on local circumstances
should be enlarged and could replace the rules for new entrants.
- The role and position of the coordinators at coordinated airports as neutral and functional
independent natural or legal persons seems to be used in different and nonuniform ways in the
EU Member States.
Furthermore, the issue of secondary trading has to be discussed on the basis of the study on the
impact of the introduction of secondary trading at Community airports
51
.
In the future, the Commission will concentrate on the correct implementation of the different
provisions which cause problems. Clarification and review can take place.
50
http://ec.europa.eu/transport/air_portal/airports/doc/2007_11_15_communication_slots_regulation_en.pdf
51
http://ec.europa.eu/transport/air_portal/airports/studies_en.htm
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5.8 Safety
The latest developments concerning safety, notably European Aviation Safety Agency (EASA)
and the list of airlines banned within the EU, are described in chapter 10.
5.9 Investigation of Civil Aviation Accidents, Incidents and
Occurrence Reporting
While air traffic is expected to grow in the following years and additional measures must be
taken to ensure and improve the standards of aviation safety, the Commission is considering
revising Council Directive 94/56/EC establishing the fundamental principles governing the
investigation of civil aviation accidents and incidents
52
and Directive 2003/42/EC on occurrence
reporting in civil aviation
53
.
In the process of forming an opinion, three streams of stakeholder consultation have been
pursued. While an external consultant prepared an impact assessment study by distributing a
detailed questionnaire directly to a number of stakeholders and interviewing a limited number of
key stakeholders, the Commission offered public consultation on the web at the beginning of
2007, based on a shorter questionnaire and open to all citizens. The final report was issued by
the consultant in July 2007.
The Commission summarised 22 replies received from different stakeholders
54
. Only a minority
opposed against the revision pointing out that it is too early to modify the Directives without
experience in application. On the other hand, a possible revision is supported because of the
needs to simplify and harmonise the rules. In particular, the option to establish a central
European Transport Safety Board was discussed controversly and with intensity.
The Commission will proceed to a large consultation of the stakeholders to decide on the
detailed provisions that should be included in a possible legislative proposal for the revision of
the two Directives.
Concerning occurrence reporting in civil aviation, the Commission adopted two implementing
regulations specifying Directive 2003/42/EC in 2007 with the objective of preventing aviation
accidents and incidents:
Regulation (EC) No 1321/2007
55
lays down measures concerning integration into a central
repository set up and managed by the Commission. It contains relevant safety-related
52
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31994L0056:EN:HTML
53
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:167:0023:0036:EN:PDF
54
http://ec.europa.eu/transport/air_portal/consultation/doc/2007_03_02/summary_paper_en.pdf
55
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:294:0003:0004:EN:PDF
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information exchanged by EU Member States, in accordance with Article 6 (1) of Directive
2003/42/EC. The details for the update of information supplied by the EU Member States will be
established by technical protocols agreed by the Commission and each EU Member State.
Regulation (EC) No 1330/2007
56
stipulates measures concerning dissemination to parties
interested in information on civil aviation occurrences exchanged by EU Member States
according to Article 7 (2) of Directive 2003/42/EC. With the objective of providing such parties
with the information they need to improve civil aviation safety, the requests for information are
evaluated and recorded by established points of contact.
5.10 Insurance
The Regulation (EC) No 785/2004 on insurance requirements for air carriers and aircraft
operators entered into force on 30 April 2007 and imposes minimum insurance requirements for
air carriers and aircraft operators in respect of passengers, baggage, cargo and third parties.
Following the terrorist attacks in the US on 11
th
September 2001, the European Commission has
taken an interest in insurance requirements in the aviation industry. In the framework of the
common transport policy, and in order to foster consumer protection and avoid distortion of
competition between air carriers, the Regulation ensures a proper minimum level of insurance to
cover liability of air carriers.
This Regulation applies to all air carriers and to all aircraft operators flying within, into, out of or
– to a certain extent - over the territory of a Member State. Article 4 (1) of the Regulation
requires both commercial air carriers and general aviation aircraft operators to be insured, to
cover the risks associated with aviation-specific liability (including acts of war, terrorism,
hijacking, acts of sabotage, unlawful seizure of aircraft and civil unrest)
According to Article 10 (1) of the Regulation, the Commission shall submit a report to the
European Parliament and the Council on the operation of this Regulation by 30 April 2008.
Between 21 September 2007 and 22 November 2007, the European Commission launched an
open consultation to get comments of interested stakeholders on the operation of the
Regulation. On the basis of a discussion paper
57
published by the Commission, 66 responses
were sent to the Commission.
56
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:295:0007:0011:EN:PDF
57
http://ec.europa.eu/transport/air_portal/consultation/doc/2007_11_17/09_21_discussion_paper_insurance.
pdf
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6 Environmental development
6.1 The Year in Brief
In January 2007 a broad discussion of the EC’s proposal for the inclusion of international
aviation into the EU-ETS took place. This was published on December 20
th
, 2006. According to
this proposal, aircraft operators will be obliged to surrender CO
2
allowances for intra-EU flights
from 2011 onwards. In 2012, the geographical scope of the scheme is intended to be extended
to include all international flights landing at and departing from any airport in the European
Union. The European Emissions Trading Scheme for the limitation of CO
2
emissions will not only
affect European airlines, but also airlines from third countries.
In February 2007, the ICAO/CAEP 7 (Committee on Aviation Environmental Protection of the
International Civil Aviation Organisation) was held in Montreal. An important issue was the
possible inclusion of international aviation in the European Emissions Trading System.
Concerning the EC’s proposal, strongly deviating views of non-EU countries were expressed at
the ICAO-CAEP/7 meeting. A number of countries believed that an inclusion of non-EU carriers
is only possible on the basis of a mutual agreement, while the European Commission believes an
inclusion is possible in the absence of a mutual agreement. Both parties argued on the basis of
the Chicago Convention on Civil Aviation. At the same time, ICAO-CAEP delivered a so-called
“ICAO Guidance for Emissions Trading in International Civil Aviation”. This guidance is for use
by ICAO Contracting States, as appropriate, to incorporate emissions from international aviation
into Contracting States’ emissions trading schemes consistent with the UNFCCC (Parties to the
United Nations Framework Convention on Climate Change) process. The guidance was adopted
by the ICAO-CAEP/7 in February 2007.
In March 2007, the ICAO Council adopted the “ICAO Guidance on Emissions Trading” after
long discussions and the decision to include a foreword expressing the views of most council
members that an emissions trading system can only be imposed on carriers of third-countries on
the basis of a mutual agreement.
In June 2007, a study by consultants CE Delft on behalf of WWF UK was published. CE Delft
analyzed the impact of high levels of auctioning of emission permits on the profitability of the
aviation sector. These impacts have been studied by applying the AERO model. On this basis, the
consultants concluded that the operating margin of the airlines is hardly affected by auctioning
the CO
2
permits, provided that the opportunity costs associated with the expenditures are
passed on to the consumers and the opportunity costs from updated benchmarking are
cancelled out by the opportunity benefits this allocation method induces.
In July 2007, the consultants Ernst & Young published an impact assessment of the inclusion of
aviation into the EU-ETS. This study was prepared on behalf of all the European carrier
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associations. The key results of the assessment are as follows: The cost of allowances to permit
the anticipated growth until the year 2022 would sum up to €45 billion. This was equivalent to
€4 billion per annum, approximately twice the cumulative profit of the sector. Since it was
assumed that it would not be possible to pass on the full allowance costs to the passengers, the
result would be a reduction in the range and frequency of services, with an adverse effect on
peripheral regions. At the end of the day there would be significant reductions in consumer
surplus and in job creation. On this basis, the Association of European Airlines (AEA) noted that
the aircraft operators did not reject the Commission’s proposal but desired changes to certain
elements in order to address their concerns.
Also in July 2007, a study by CE Delft and Manchester Metropolitan University (MMU) on “The
Impacts of the Use of Different Benchmarking Methodologies on the Initial Allocation of
Emission Trading Scheme Permits to Airlines” was published. A benchmark is defined on the
basis of the average specific CO
2
emissions of the aircraft operator in the past. This study was
prepared on behalf of the UK Department for Transport and the Environment Agency. One of
the main findings was that a benchmark for the initial allocation of CO
2
permits on the basis of
CO
2
per Revenue Tonne Kilometre has the most favourable impacts on the airlines subject to the
EU-ETS.
In September 2007, the 36
th
Assembly of ICAO was held in Montreal. The update of resolution
A35-5 “Consolidated Statement of continuing ICAO policies and practices related to the
environmental protection” was discussed under agenda item 17 – Environmental protection. In
line with what was expected before, the issue of “mutual agreement” in relation to emissions
trading, together with the possible continuation of a moratorium for greenhouse gas charges,
were the controversial points in the discussion. The position of the non-European States, that
emissions trading can only be applied for other State’s airlines on the basis of mutual agreement
between States, was not supported by the European States. By the end of the Assembly it
eventually proved not possible to reach an agreement on the controversial issues and the
Resolution text therefore reflects the position of the majority of States. As a result, Europe could
not agree to a Resolution text that urges States to refrain from unilateral implementation of
greenhouse gas measures and entered a formal reservation on the relevant part of the
Resolution.
In October 2007, the European Parliament published a “Report on the proposal for a directive of
the European Parliament and of the Council amending Directive 2003/87/EC so as to include
aviation activities in the scheme for greenhouse gas emission allowance trading within the
Community”. The rapporteur of this report was Mr Peter Liese. The European Parliament
concluded that the EC’s proposal for the inclusion of aviation into the EU-ETS will be supported
by the EP, but a number of substantial changes have to be made. This report was subject to a
number of discussions in and outside of the European Parliament.
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On November 13th, 2007, the European Parliament plenary voted on the EC’s proposal. The
decision was to support the proposal if ambitious ecological improvements will be accepted.
Among other suggestions, the European Parliament proposed to auction 25 per cent of the
allowances for the aviation sector, while the European Commission initially proposed to auction
3 per cent of the total allowances allocated to the aviation sector. Also, the European Parliament
voted for the inclusion of all flights departing from or landing at any EU airport into the EU-ETS
by the year 2011, while the Commission favours a two step-approach: to start with the inclusion
of intra-EU flights by 2011 and to extend the scope of the scheme by the year 2012.
In late December 2007, the EU Environmental Council reached a political agreement on a draft
directive for the inclusion of aviation into the EU Emissions Trading Scheme. The main elements
of this draft directive are described and discussed below. The publication of a modified
legislative proposal on the inclusion of aviation into the EU-ETS by the European Commission on
this basis is expected for spring 2008.
6.2 Emissions Trading Scheme for Aviation
On December 20
th
, 2006, the European Commission published a proposal for the inclusion of
international aviation into the EU-ETS. Since its publication, this proposal is being intensively
considered and discussed by a number of both global and European institutions. One year later,
on December 20
th
, 2007, the EU Environmental Council reached a political agreement on this
issue on the basis of a modified text tabled by the Portuguese Presidency. According to this
agreement, the draft directive would contain the following provisions for the inclusion of
international aviation into the existing emission trading scheme:
Aircraft operators will be obliged to hold and surrender allowances for CO
2
emissions. Allow-
ances are required for flights by aircraft with a maximum take-off mass of or above 5,700 kg.
Flights performed under visual flight rules, training and check flights, flights by non-EU state
aircraft and rescue flights as well as flights performed in the framework of Public Service
Obligations on routes within outermost regions are some exemptions from the scheme. Aircraft
operators can also be excluded on the basis of a so-called de minimis clause: The exclusion of
flights performed by a commercial air transport operator which operates less than 243 flights
per period over three consecutive four-month periods. Regulations for emissions monitoring and
reporting will take effect in 2010 while an emissions cap for all participating aircraft operators
will be introduced in 2012.
From January 1
st
, 2012, the emissions trading scheme will cover all flights departing from or
arriving at EU airports. Domestic aviation will be subject to the same rules as international air
traffic.
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Consequently, the European emission trading scheme will not only affect European airlines but
also airlines from third-countries from 2012 onwards. But if any non-EU country introduces
alternative measures with similar climate protecting effects, the geographical scope of the
emission trading scheme could be modified such that flights arriving from or departing for this
particular country are excluded from the scheme.
Further rules in the Commission’s proposal, as supported by the Council’s political agreement,
include the following issues:
The total number of allowances allocated to the sector will be calculated on the basis of the
mean average of the annual emissions in the calendar years 2004-2006 by the operators taking
part in the scheme.
Initially, allowances will be allocated to aircraft operators mostly free of charge. Only 10 per cent
of the initial allocation will be auctioned in the year 2012. For future periods, this percentage
may be increased.
The EU Member States will decide how to use revenues generated from auctioning allowances.
In general, these revenues should be used to tackle climate change in the EU and third countries
and to cover the costs of administering Member States in relation to this directive.
Three percent of the total quantity of allowances to be allocated to the aviation sector will be
set aside in a special reserve for certain aircraft operators which are entering the aviation market
for the first time or are growing very quickly.
The total number of allowances allocated to each aircraft operator will be determined by a so-
called benchmark, which is defined on the basis of the average specific emissions of the
operator in the past. The reference of the benchmark is the operator’s revenue ton-kilometres
that are calculated by multiplying the mission distance (great-circle-distance plus an additional
fixed factor of 95 km) by the payload transported (cargo, mail and passengers).
Allowances allocated to aircraft operators can be traded freely within the EU-ETS. In addition, it
will be possible for aircraft operators to purchase permits from other sectors or from the project
based Kyoto instruments “Joint Implementation” and “Clean Development Mechanism”. For
the year 2012, aircraft operators may use permits from these project based instruments for up
to 15 percent of the total allowances to be surrendered. For subsequent periods this percentage
may be different.
The publication of a modified legislative proposal on the inclusion of aviation into the EU-ETS by
the European Commission on the basis of the political agreement reached in December 2007 is
expected for spring 2008. The aim of the draft directive is to improve the quality of the
environment by reducing the growing climate change impact of international aviation. It is also
an objective of the proposal to provide a model for aviation emissions trading that can be a
point of reference in the EU’s contacts with key international partners and to promote the
development of similar systems worldwide.
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Aviation’s NO
x
emissions can also contribute to the anthropogenic climate change. In order to
also limit aviation’s NO
x
emissions in the EU in the future, the European Commission is planning
to propose a directive in 2008.
6.3 Aviation Noise
In the "Report of the High Level Group for the future European Aviation Regulatory Framework:
European Aviation - A framework for driving performance improvement" of July 2007 on
aviation noise it is noted that “the Advisory Council for Aeronautics Research in Europe (ACARE)
has recently set goals for 2020 which include a 50% reduction of external noise”.
On 20 June 2007 the European Parliament issued a “Draft report on airport capacity and ground
handling: towards a more efficiency policy (2007/2092 (INI))”. Therein the Parliament realizes,
“that in the absence of new internationally agreed noise stringency standards before 2010, a
new approach to limit the number of people affected by noise will be needed in the mid term
and in any case before 2025; (it) invites the Commission to examine the introduction of such a
new approach which would be more restrictive, lead to common standards for noise restriction,
a level playing field between airports and a generalisation of noise charges schemes; … and the
reinforcement of operating restrictions at EU level”.
As early as 24 January 2007, the European Commission published a “Communication about an
action plan for airport capacity, efficiency, and safety in Europe” (COM (2006)819 final). It is
based on the Balanced Approach to Noise, agreed at the 2001 ICAO assembly. In the Directive
2002/30/EC (OJ L 85, 28.3.2002, p. 40) these principles have been incorporated in Community
law. The Member States should also have due regard to the provisions of the Ambient Noise
Directive (2002/49/EC) which will be reviewed in 2009. Already in 2006 the Commission
launched a study “to examine the implementation of the Directive and to analyse the changes
that took place with regard to the noise levels at Community Airports since its entry into force”
(p. 10 f.). On this basis the Commission prepared in 2007 a report on the implementation, on
the basis of which the Commission intends to decide whether a proposal for amending the
Directive is required.
2007 also saw the deadline for research proposals of the 7
th
Research Framework of the EU
Commission. Several of the projects include dealing with aviation noise. These projects have to
collaborate to fulfil this challenging goal of noise reduction.
58
Current studies dealing with
aviation noise are The Greening of Air Transport which analyses the goal of halving the
perceived noise. Other studies are X-Noise (www.xnoise.eu), Sourdine II (www.sourdine.org),
and Silence-R
59
. These projects are mainly technology oriented.
58
For a list of calls see
http://cordis.europa.eu/fp7/dc/index.cfm?fuseaction=UserSite.CooperationCallsPage&id_activity=7
59
See the article about the final meeting of the project on 16.7.2007 at
http://ec.europa.eu/research/transport/news/article_5637_en.html.
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In the first paragraph of this chapter the development of ever more stringent measures was
mentioned. Noise is predominantly a local problem and needs local measures to reduce its
effects on the population without excessively hindering the development of the aviation industry
and its contribution to the economy. For this reason, national or supranational regulations
cannot give more than some guidelines for measures to reduce noise. Most airports have
introduced an individual set of measures more or less appropriate to their specific needs. It has
always to be a compromise between the interests of the people living there and the economic
needs of the region and the interest of the service providers at the specific airport.
On its website, Boeing provides some interesting information about the measures different
airports have taken against noise. The information in this list has to be handled with care
because there are certain limitations of the information making a comparison rather difficult. So
there is no guarantee that all airports of a country are included – and in some countries it’s very
obvious that not all airports provided the necessary data. Another limitation can be seen in the
missing official definition of the measurements so that it is in the hands of the respective airport
how they define their measures. As a further limitation it has to be mentioned that every
measure may have a weak or a rather strict expression.
Table 6-1: Applied Noise and Emissions Regulations at Airports 2007; World and Europe
Source: DLR-evaluation of Boeing Company database 01.2008 "Airport Noise and Emissions Regulations"
World Europe World ./. Europe
Total % Total % Total %
Number of selected Airports
643
100
174
100
469
100
Applied measurements
APU Operating restrictions 124
19
83
48
41
9
Airport curfews 233
36
112
64
121
26
Engine run-up restrictions 391
61
124
71
267
57
Noise abatement procedures 482
75
140
80
342
73
Noise budget restrictions 13
2
6
3
7
1
Noise level limits 99
15
55
32
44
9
Noise surcharge 129
20
98
56
31
7
Emissions surcharge 14
2
14
8
0
0
Operating quota 53
8
35
20
18
4
Preferential runways 354
55
106
61
248
53
Chapter 3 restrictions 60
9
47
27
13
3
Taking all limitations into consideration, the preceding table gives a good impression of the
distribution of measures worldwide. From this table it is obvious that most airports use more
than one measure to reduce the negative impact of noise. It can also be seen that non-European
airports concentrate more on technical measures whereas the list of potential measures has a
wider range for European airports, including more economic measures.
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In the next table we concentrated on European countries where we could assume that the list of
participating airports is rather complete or at least representative. The table only contains 12
countries out of a list of 29 countries in total. These 12 countries represent 41% of the
countries, but 83% of all the European airports listed in this database.
Table 6-2: Applied Noise and Emissions Regulations at European Airports 2007 (Sample 144 airports from
12 countries)
Source: DLR-evaluation of Boeing Company database 01.2008 "Airport Noise and Emissions Regulations "
AT BE CH DE DK FR GB IS IT LU NL SE Total %
Number of selected Airports
65624622383181312144
100
Applied measurements
APU Operating restrictions 4 3 5 3 5 8 20 2 14 1 1 6 72
50
Airport curfews 5 3 5 21 2 14 27 2 10 1 3 6 99
69
Engine run-up restrictions 4 5 3 20 5 13 33 2 13 1 3 4 106
74
Noise abatement procedures 4 5 6 16 6 15 34 2 15 1 2 8 114
79
Noise budget restrictions 2 1 1 1 1 6
4
Noise level limits 2 2 4 5 4 3 14 6 2 5 47
33
Noise surcharge 2 3 6 22 17 13 17 1 2 7 90
63
Emissions surcharge 3 2 1 2 6 14
9
Operating quota 4 2 3 3 17 1 1 31
22
Preferential runways 4 4 4 11 3 15 16 3 12 1 9 82
57
Chapter 3 restrictions 1 4 12 3 7 10 1 1 2 47
28
Countries
Comparing the results of all participating European airports with those of the 12 countries it can
be seen that the difference in usage of noise abatement measures is minor. It is only perceivable
that airports of the 12 countries remarkably often have a noise surcharge, and the small number
of airports having an emission surcharge are all from these 12 countries. The preferential runway
choice, in contrast, is found more often at airports in those countries where not all airports have
participated.
With regard to some specific information on these 12 countries, it can easily be seen that also
some countries' minor airports contributed to Boeing's database. That is the only way to explain
why there are e.g. 5 airports in Belgium or 6 in Switzerland. Surprisingly the differences between
the number of measures used does not differ very much, on average all airports have 4.9
measures, those in France 4.4, in Germany and Italy 4.8 and in Great Britain 4.9 – a very small
dispersion around the mean. Remarkable is also that those measures which are so far relatively
seldom have no concentration in certain countries. This can be seen with noise budget
restrictions or the emission surcharges. In Germany and in Italy nearly all airports have a noise
surcharge on the landing fee, whereas in GB most airports use noise abatement procedures and
engine run-up restrictions. In France and in Sweden there are no predominant measures.
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7 Consumer Issues
7.1 Punctuality
The measurement of delay is dedicated to giving an impression of the performance of the
transport mode aviation and is therefore of major interest for consumers.
Delay means that the actual time of departure or arrival lies behind the published schedule.
Beyond a certain limit however, a delay is referred to as an unpunctuality. A delayed flight
becomes an unpunctual one when the actual time of arrival or departure is more than 15
minutes after the scheduled time. Pulling up at or leaving the parking position is the reference
time for arrival or departure. Delays to an aircraft that is ready for take-off that occur after
leaving the parking position are therefore not regarded as delayed departures.
Passengers are particularly aware of delays in arrival, as these jeopardise their ability to catch
connecting flights or take advantage of other arrangements for continuing the journey. From an
operational point of view, both delays and early arrival/departure can cause numerous problems
with the allocation of resources, in very busy airports or airspace for example. The flight
schedules published by the airlines therefore include extra periods of time to ensure a minimum
level of punctuality. These time buffers are added to the ideal, undisturbed flight times, taking
into account mainly empirically derived knowledge about the actual distribution of block times
(the period of time between leaving the parking position at the starting airport and arrival at the
parking position at the destination airport). Fluctuations in the actual duration of flights over the
course of a season result from diverse influencing factors that cannot be anticipated exactly, for
example weather conditions, different flight paths and levels, air traffic control measures and
different amounts of time taken to carry out clearance processes. The time buffers therefore
moderate the number of actual ‘delays’, albeit at the cost of additional scheduled waiting time
that the passenger must spend in the air traffic system.
7.1.1 Actual Punctuality
Overall European air traffic punctuality in 2007
corresponded to the level in the previous year of just
below 80%. Data provided by the Association of
European Airlines (AEA) was referred to as the European
reference. The AEA currently includes 31 airlines, most of
which are Full Service Network Carriers.
Figure 7-1: Three out of four flights arrived on time in 2007
Source: AEA
77%
23%
on-time behind schedule
15 min15 min
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The AEA airlines achieved in 2007 a punctuality of about 77% for all operations. For
comparison, levels of punctuality in the largest domestic air traffic market in the world, the USA,
are shown in Figure 7-2. The data used here does not originate from a private association, but
rather the Federal Aviation Authority (FAA). All domestic flights to and from major US airports
analysed by the FAA are taken into account. A direct comparison of the cumulative values
suggests that for many years the European airlines have been slightly more punctual than the
airlines in the USA, however the AEA figures also include all long haul flights, which has a
skewing effect on the punctuality statistics (long haul flights are not included in the FAA data).
Figure 7-2: Punctuality: US vs. Europe
Source: AEA, FAA
Arrival punctuality
80.7%
79.0%
77.1%
77.9%
77.1%
75.2%
76.9%
72.8%
0%
25%
50%
75%
100%
2004 2005 2006 2007
Europe (AEA) US (FAA )
The greater punctuality of the AEA airlines becomes obvious when, similarly to the US figures,
only domestic flights are taken into consideration. This is illustrated by the quarterly figures from
the AEA and FAA, as shown in Figure 7-3. AEA punctuality on short and medium haul flights is
shown in light blue, with overall values for the AEA shown in dark blue. The superior punctuality
of the European FSNCs in comparison to the North American airlines is also evident in the
quarterly representation.
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Figure 7-3: Quarterly punctuality performances (AEA and FAA numbers)
Source: AEA, FAA
78.4%
77.1%
76.3%
75.9%
79.3%
77.9%
77.1%
76.9%
70.8%
73.7%
73.9%
73.4%
0%
25%
50%
75%
100%
2007-Q1
2007-Q2
2007-Q3
2007-Q4
Arrival Punctuality
AEA AEA IEDO FAA
Figure 7-4: Quarterly departure vs. arrival
punctuality of the AEA-Airlines (IEDO flights)
Source: AEA
The punctuality achieved can also be
considered separately on a departure and
arrival basis. From a consumer’s point of
view, arrival punctuality is probably more
important than the question of whether the
flight took off on time or not. Nonetheless,
all compensation that may be due under
Regulation 261/2004 with regard to a delay
is based on a delay from the place of
departure. As illustrated in Figure 7-4,
departure punctuality was on average
slightly better than arrival punctuality. There
was therefore a tendency for time to be lost
whilst flying to the destination airport. This
was however not the case in the third quarter, when overall arrival punctuality was nearly
congruent with departure punctuality. Time normally lost was therefore either caught up in
81.3%
79.3%
79.0%
77.9%
77.2%
77.1%
78.4%
76.9%
0%
25%
50%
75%
100%
Ø Departures Ø Arrivals
AEA IEDO Punctuality
Q1 - Q4 / 2007
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flight or additional time was allocated for turnaround. This effect could theoretically also be
attributable to an adjustment of the turnaround plans and the buffer times for schedule
stabilisation contained therein. This is however unlikely given the large number of flights taken
into consideration (>4 million movements in 2007).
In Figure 7-5, arrival punctuality is shown separately for short and medium haul (AEA says IEDO
for Intra-European and Domestic) and long haul services. This reflects the individual punctuality
performance profiles for both services. Long haul flights are generally characterised by lower
punctuality rates than short or medium haul flights. Although it is possible to partially
compensate for departure delays by increased speed during long haul flights, this may be
hampered by unfavourable weather conditions (a headwind, for example) or flight control
restrictions.
One of the main reasons for the
susceptibility of long haul flights to
being delayed is their integration into
a hub and spoke network. Many
smaller feeder aircraft are required at
the hub airport in order to fill a large
long haul plane. The probability of a
long haul jet being subject to delay
therefore increases with the number
of feeder aircraft carrying transfer
passengers and freight that have to be
waited for. Long haul flights also tend
to operate mainly between very busy
hub airports, which can also help to
explain the inferior punctuality.
Figure 7-5: AEA arrival punctuality
performances of short/medium haul vs.
long haul services
Source: AEA
The following section provides a more detailed analysis of the data than the highly aggregated
punctuality figures considered above. This focuses on selected airports in Europe that feature
regular flights by AEA airlines, namely:
AMS Amsterdam, ATH Athens, ARN Stockholm, BCN Barcelona, BRU Brussels, CPH Copenhagen, DUB Dublin, DUS
Dusseldorf, FRA Frankfurt, GVA Geneva, HEL Helsinki, IST Istanbul, LCA Larnaca, LIS Lisbon, LGW London Gatwick,
LHR London Heathrow, MAD Madrid, MAN Manchester, LIN Milan Linate, MXP Milan Malpensa, MUC Munich, OSL
Oslo, CDG Paris Charles de Gaulle, ORY Paris Orly, FCO Rome Fiumicino, VIE Vienna, ZRH Zurich
77.9%
66.3%
77.7%
65.9%
0%
25%
50%
75%
100%
Annual 2006 Annual 2007
AEA arrival punctuality
Short/Medium Haul (IEDO) Long Haul
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Again, the data presented relates to the punctuality achieved by IEDO flights without long haul
services included. The higher long haul traffic delay rates are largely due to reasons that cannot
be assigned to the airport area and which would therefore limit the comparability of the values.
The precise reasons for specific conditions at individual airports cannot be deduced from the
statistics. It is however discernable, giving due consideration to seasonal influences, that
significant differences exist across Europe as a whole. Analysis of whether delays to departing or
arriving traffic represent the larger category can indicate the respective cause of the delays. The
average delay for unpunctual arrivals and departures in the first quarter of 2007 was a good 40
minutes, which fell slightly to 39 minutes in both cases in the second quarter. During the third
quarter, the average waiting time for delayed departures dropped to 38 minutes, while the
cumulative delay for arrivals remained at around 39 minutes. Last quarter of 2007 showed an
average of slightly above 40 minutes for both late arrivals and late departures.
Figure 7-6: Proportion of delayed flights (IEDO) and average delay per delayed flight at selected airports in
2007
Source: AEA
0
10
20
30
40
50
60
LHR
LGW
FCO
DUB
CDG
MAD
ATH
LCA
FRA
BCN
LIS
MAN
CPH
IST
MUC
ARN
HEL
AMS
ZRH
GVA
MXP
ORY
LIN
OSL
VIE
DUS
BRU
Ø delay (minutes)
Avg. delay of delayed departures Avg. delay of delayed arrivals
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
[%] of AEA traffic (IEDO)
Delayed departures Delayed arrivals
0
10
20
30
40
50
60
LHR
LGW
FCO
DUB
CDG
MAD
ATH
LCA
FRA
BCN
LIS
MAN
CPH
IST
MUC
ARN
HEL
AMS
ZRH
GVA
MXP
ORY
LIN
OSL
VIE
DUS
BRU
Ø delay (minutes)
Avg. delay of delayed departures Avg. delay of delayed arrivals
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
[%] of AEA traffic (IEDO)
Delayed departures Delayed arrivals
In addition to considering delays at particular airports, it is also worth taking a look at the
punctuality performance of the airlines. Taking the AEA airlines as an example shows that there
are also significant differences in punctuality between the airlines. Since not all AEA airlines
provide long haul services, only the relevant IEDO flights are compared. Luxair (LG) was
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repeatedly the most punctual AEA airline with an arrival punctuality of just under 90% in 2007.
The least punctual airlines on the other hand only managed to obtain punctuality scores of just
over 50%. An interesting point is the fact that departure and arrival punctuality become similar
to each other at approximately 77% by the third quarter. At the start of the year, departure
punctuality was as high as 81.3%, while arrival punctuality was at 79.3%.
A different association, the European Regions Airline Association (ERA), reports an overall annual
departure punctuality of a good 84% (2006: 83%), based on data for its 31 member airlines for
the year 2007.
Figure 7-7: AEA-Airline punctuality performances (IEDO) in 2007
Source: AEA
Ø 78.9%
Ø 77.7%
50%
55%
60%
65%
70%
75%
80%
85%
90%
95%
100%
LG
KL
OS
MA
SN
RO
AF
OK
LH
AY
SK
BD
LX
TK
IB
JU
AZ
JP
LO
OU
OA
KM
FI
AP
BA
CY
JK
TP
Proportion of punctual flights
Departure punctuality Arrival punctuality Ø AEA Departure Punctuality Ø AEA Arrival Punctuality
Full year 2007
Intra-European and Domestic Services
7.1.2 ATFM Delays
The Central Flow Management Unit (CFMU) at Eurocontrol is responsible for the provision of an
efficient ATFCM service within the ECAC States. Air Traffic Flow and Capacity Management
(ATFCM) is one of the constituent parts of Air Traffic Management (ATM) and the CFMU
provides an ATFCM service to airspace users throughout Europe.
The CFMU is responsible for management of air traffic in Europe and therefore monitors
resource allocation for aircraft in the air and at destination airports. If the CFMU determines that
more resources (airspace or airport capacity) have been requested locally than are available, then
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it regulates traffic by keeping aircraft that are ready for take-off at the departure location on the
ground until the requested resources are actually available.
The monthly figures from the CFMU for 2007 are shown in Figure 7-8. The number of regulated
flights represents all flights that were allocated a slot (irrespective of the length of any delay).
The number of delayed flights represents the number of aircraft that were actually delayed due
to ATFCM (irrespective of the length of the delay). The chart clearly shows a disproportionately
high increase in daily regulated traffic and the number of delayed flights during the busiest
months in the summer. The annual proportion of ATFM-delayed traffic in 2007 lies with 11%
slightly above the previous years (2006: 9.9%).
Figure 7-8: Number of daily regulated and delayed flights per month in 2007
Source: Eurocontrol: CFMU ATFCM Public Report December 2007. Brussels, Belgium 2008
25138
26221
26841
28627
30392
30406
30277
30560
28976
26494
24134
2843
3493
4003
3799
5515
8096
8058
5934
6379
5640
4256
3588
1687
1973
2296
2121
3241
5252
5120
3455
3700
3261
2424
2103
23917
0
5000
10000
15000
20000
25000
30000
35000
2007-01
2007-02
2007-03
2007-04
2007-05
2007-06
2007-07
2007-08
2007-09
2007-10
2007-11
2007-12
daily IFR traffic daily regulated traffic daily delayed traffic
Most Affected Traffic Flows
The effects of traffic flow control can be demonstrated on the basis of data provided by
Eurocontrol. The most affected traffic flows in Europe are shown in Figure 7-9. This analysis
considers traffic levels during the summer of 2007, which is IFR traffic between April and
September 2007. It is clearly evident that the traffic flows most often affected by delays due to
capacity bottlenecks are those running from north to south. Flows to Greece/Cyprus feature
most strongly here, which is hardly surprising in view of the amount of holiday traffic to the
warm water regions of Europe. The ‘front-runner' in terms of CFMU regulation was the flow
from Scandinavia to Greece/Cyprus, with an average ATFM delay across all flights of over 13
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minutes. The average delay for all flights delayed by at least 15 minutes – over 48% of the total
traffic on this route – was almost 28 minutes.
Figure 7-9: Most affected traffic flows Summer 2007
Source: Eurocontrol/CODA: Delays to Air Transport in Europe – Summer 2007. Brussels, Belgium. 2007
Summer 2007 (April-September)
13,4
9,3
9,0
8,6
8,0
7,8
7,2
7,1
7,1
6,9
27,8
27,4
23,9
21,2
22,1
21,2
21,7
24,9
18,7
21,6
48%
34%
38%
36%
37%
33%
38%
32%
29%
40%
0
5
10
15
20
25
30
Nordic States to
Greece/Cyprus
BENELUX to
Greece/Cyprus
U.K. & Ireland to
Greece/Cyprus
London Airports
to Greece/Cyprus
Italy-North to
U.K. & Ireland
Italy-North to
London Airports
Greece/Cyprus to
Nordic States
Germany-West
to Greece/Cyprus
Nordic States to
Paris Airports
U.K. & Ireland to
Italy-North
delay in minutes
0%
10%
20%
30%
40%
50%
60%
share of total traffic
Average Delay per Movement Average Delay per Delayed Flight Percentage of Delayed Flights
7.2 Delayed Baggage
After a delay limit of up to 21 days, as it is defined in the Montreal Convention, an airline must
treat a bag as lost. In general, this makes a difference to how airlines settle claims. “There are
no set rules for how airlines must assess baggage claims”, states the Airport Users Council
(AUC). For delayed baggage, some airlines offer immediate payments as a replacement for
emergency purchases (e.g. such as toiletries or underwear). Some will pay a set daily amount but
only for a pre-defined period of time. But others will not make cash payments in advance,
preferring to pay back expenses on essential items on seeing the receipts. In general, most
airlines favour to cover essential expenditure resulting from the delay until the baggage is
delivered.
Unhappily, accompanied baggage does not always arrive late but also sometimes not at its
intended destination. Or, if it does arrive, it might turn up dented, totally damaged or
incomplete. When this happens, an airline is responsible for the damage under the Montreal
Convention. The Convention does however place a maximum limit on the airline’s liability of
1,000 Special Drawing Rights (SDRs) per passenger. The value of one SDR in terms of US Dollars
is newly determined on a daily basis by the International Monetary Fund (IMF). The value bases
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on the current exchange rates of the currencies contained in the SDR’s basket (currently USD
44%, EUR 34%, JPY 11% and GBP 11%).
The AEA reports regularly on the number of delayed baggage items. Twenty four airlines
provided related data for 2007. During this period, 377,301,582 passengers were enplaned by
these airlines, but 6,246,820 pieces of baggage were delayed in reaching their owners. This
figure is based on all baggage for which a report was made. Information about subsequent
delivery and/or compensation is not available. The following diagram illustrates the figures for
the relative frequency of such reports lodged with the participating AEA airlines over the last
few years.
Figure 7-10: Delayed baggage history
Source: AEA
15.1
13.9
14.1
15.7
16.6
0
2
4
6
8
10
12
14
16
18
20
2003 2004 2005 2006 2007
number of bags delayed upon arrival per 1,000 pax
Among the participating AEA airlines in 2007, late arrival of baggage is particularly frequent
with TAP Portugal (27.8 delayed bags per 1,000 passengers) and British Airways (26.5 delayed
bags per 1,000 passengers). An average of 16.6 delayed bags per 1,000 passengers was
recorded for all AEA airlines over the same period. The quarterly AEA data indicates that delays
traditionally increase in the third quarter – with nearly 19 bags delayed per 1,000 passengers in
2007 - which includes the high traffic volumes in the summer season.
7.3 AEA Flight Regularity
Flight regularity measures the share of scheduled flights that actually operated. As given by the
AEA, individual flights are sometimes cancelled because of low productivity, but a flight may
also be cancelled due to bad weather, for technical reasons or other operational constraints. All
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changes in schedule up to 3 days before the planned day of operation are taken into
consideration. A retrospective view can be used to give an indication of the flight reliability that
can be expected in the next season. A total of approximately fifty-eight thousand AEA flights
out of the 4.124 million scheduled services were cancelled during the four quarters of 2007.
That is about the same flight regularity as in 2006.
Figure 7-11: Flight regularity, AEA quarterly 2006-2007
Source: AEA
97.7%
99.0%
98.7%
98.4%
98.1%
98.7%
99.0%
98.3%
99.5%
99.7%
99.4%
99.5%
99.5%
99.6%
99.5%
99.0%
97%
98%
99%
100%
Q1 Q2 Q3 Q4
2006 IEDO 2007 IEDO
2006 Long haul 2007 Long haul
Annual 2006
Annual 2007
IEDO 98.5%
98.5%
Long haul 99.5%
99.4%
In comparison with the FAA’s figures for the
US, it is apparent that flights are cancelled
slightly more often in North America than is the
case for comparable flights in Europe. Instead
of 98.5% regularity, a rate of only 97.7%
(domestic traffic from/to major US airports) is
achieved in the United States of America.
Figure 7-12: Flight regularity, AEA short/medium haul
services vs. FAA
Source: AEA, FAA
98.5%
98.2%
98.5%
97.7%
95%
96%
97%
98%
99%
100%
2006 2007
AEA IEDO FAA
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7.4 Air Passenger Rights in the European Union
Regulation (EC) 261/2004
60
of the European Parliament and of the Council establishing common
rules on compensation and assistance to passengers in the event of denied boarding and of
cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91, entered into
force on 17 February 2005.
The main objective of this Regulation is to improve the situation for passengers if their journey is
disrupted and to ensure they receive a higher level of protection. In the event of denied
boarding or cancellation of flights, passengers’ rights include reimbursement of their tickets,
alternative transport to their destination, and a financial compensation (staggered up to 600€
for flights of over 3500 km). In additional to that, meals, refreshments, means of
telecommunication and hotel accommodation, if necessary, must be made available.
Extraordinary circumstances can only be invoked by airlines not to pay financial compensation in
case of cancellation. They hold the burden of proof in such context. Member States are required
to ensure and supervise general compliance by their air carriers with this legislation and to lay
down rules on penalties applicable to infringements that are effective, proportionate and
dissuasive.
On 4 April 2007 the Commission published a communication to the European Parliament and
the Council pursuant to Article 17 of the Regulation on the operation and the results of this
Regulation
61
.
Although improvements have been made for the passengers and the denied-boarding
compensation system has been improved in comparison to the repealed Regulation (EEC) No.
295/91, further important steps need be taken to ensure that airlines apply the rules more
consistently and that these rules are better enforced by the Member States.
The Commission is therefore focussing its work on a number of different areas: improving
enforcement, clarifying the interpretation of certain aspects of the Regulation, establishing
clarity between delays and cancellations (because different rights are awarded to passengers
depending on the circumstances), and enhancing the role of the National Enforcement Bodies
that oversee the application of the common rules.
- Improvement of enforcement
Because the Regulation does not cover in detail the competencies and tasks to be fulfilled by the
National Enforcement Bodies, passengers’ rights are applied in an inconsistent way.
60
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2004:046:0001:0007:EN:PDF
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The Commission also wants to promote close communication with and between the National
Enforcement Bodies. This takes the form of a “code of good practice” aimed at improving
aspects not covered by the Regulation (e.g. timescales for processing of complaints, quality of
statistics, language issues, transferral of complaints between National Enforcement Bodies). With
regard to the Member States, the Commission has emphasised its option to initiate infringement
proceedings if enforcement seems to be ineffective at national level.
In 2007, the European Court of Justice declared that, by failing to lay down the penalties for
infringements of the provisions of the Regulation, two Member States (Case C-264/06
62
Commission of the European Communities versus Luxembourg and Case C-333/06
63
Commission versus Sweden) have failed to fulfil their obligation under Article 16 of this
Regulation.
- Clarification of the unclear aspects of the Regulation
As one item, the scope of the Regulation remains inexplicit with regard to its application to that
part of a journey with a Community Carrier that was started in a Member State but is the
continued abroad between two non-EU-countries. This is the reason behind a reference for a
preliminary ruling of the European Court of Justice
64
.
Despite explanations and examples of extraordinary circumstances in the recital clauses of the
Regulation
65
, it seems to be debatable if technical problems constitute extraordinary
circumstances avoiding the carrier to pay financial compensation under Article 5 (3) of the
Regulation.
- Distinction between delays and cancellations
In the absence of a precise differentiation being specified by the Regulation, some operators
have deemed certain events to be classed as long delays rather than cancellations in order to
avoid potential claims for compensation from passengers, which would only allowed in case of
cancellation.
Various National Courts have requested that the European Court of Justice make a ruling on the
differentiation. On 19 October 2007, the Court ordered that cases C-402/07 and C-432/07,
which concern the same subject matter on the interpretation of Article 2 lit. l) and Article 5 (1) lit
c), be merged
66
.
62
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63
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:046:0001:0007:EN:PDF
64
Case C-173/07 - http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2007:155:0009:0009:EN:PDF
65
Recital (14) and (15) of Regulation (EC) 261/2004
66
Text only available in French or German: http://curia.europa.eu/jurisp/cgi-
bin/form.pl?lang=en&Submit=Rechercher&alldocs=alldocs&docj=docj&docop=docop&docor=docor&docjo
=docjo&numaff=C-432/07&datefs=&datefe=&nomusuel=&domaine=&mots=&resmax=100
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To assist in the short term, the Commission has also developed updated information material to
provide information to passengers and to encourage the above developments. The Commission
also maintains an up-to-date list of the different National Enforcement Bodies responsible for
overseeing the application of the common rules
67
. The Commission has also strengthened its
cooperation with the European Parliament. During a discussion between Commissioner Barrot
and Members of the Committee on Transport and Tourism on 8 May 2007, the MEP advocated
the speedy modification of the Regulation. The Commission seems to favour cooperation with
the National Enforcement Bodies and the airlines as a first step to improving the effectiveness of
the Regulation. The Commission could then initiate infringement procedures against Member
States.
The result of these discussions between National Enforcement Bodies and airlines are published
on http://apr.europa.eu
It consists of:
Understanding between NEB – NEB on complaint handling procedures
Understanding between NEB – Airlines on procedures
Answer to Questions on the application of Regulation 261/2004
EU Complaint Form for air passengers
7.4.1 Implementation of Air Passenger Rights
Regulation (EC) 261/2004 establishing common rules on compensation and assistance to
passengers in the event of denied boarding and of cancellation or long delay of flights is
applicable to all cases in which flights are cancelled, departures are delayed or boarding is
denied. A large increase in air passenger rights related cases has been reported by the European
Consumer Centres since the introduction of Regulation (EC) No 261/2004 on 17 February 2005.
The Montreal Convention chiefly regulates the liability of airlines in cases of damaged or lost
luggage, as well as in cases of economic damage caused by delay to a flight. The Montreal
Convention is only enforceable through the legal system and is not linked to Regulation (EC)
261/2004. This means that the National Enforcement Bodies are not responsible for issues
covered by the Montreal Convention.
National Enforcement Bodies ([EC]261/2004)
Specific National Enforcement Bodies are responsible for monitoring the correct implementation
of Regulation (EC) 261/2004. The National Enforcement Bodies inform dissatisfied air passengers
about their rights and are authorised to impose penalties on airlines violating the Regulation as a
future deterrent. These bodies are however not directly responsible for enforcement of claims
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for compensation and assistance resulting from the Regulation. It is the customer’s own
responsibility to assert his/her rights by way of legal action in case of unresolved issues.
Table 7-1: National Enforcement Bodies regarding Regulation (EC) 261/2004 on passenger rights
Source: DG TREN
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7.4.2 European Consumer Centre Network
Consumer associations (European Consumer Centres) are an alternative choice available to
customers who have been disappointed by a transportation provider. The European Consumer
Centre Network (ECC-Net) assists consumers with cross-border disputes within the European
Internal Market in particular. ECC-Net actually consists of national centres in 27 European
countries. This Network is co-financed by the European Commission (Health and Consumer
Protection Directorate-General) and by each of the Member States.
A large increase in the number of cases relating to air passenger rights is recorded by ECC-Net
every year. While a total of 2,716 cases were recorded in 2005, the number had risen to 4,901
cases by 2006. 2,979 of the cases involved a concrete complaint. Most of these complaints
concerned baggage problems (32.8%), followed by cases involving cancellations (26.3%), delays
(15.6%) and denied boarding (6.5%). It is surprising that the majority of enquiries received
related to baggage, despite the fact that Regulation (EC) 261/2004 does not cover baggage
problems, with baggage issues instead falling within the scope of the regulations of the
Montreal Convention.
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ECC-Net registered as many as 1,500 complaints and disputes during the first 6 months of
2007. Since this period does not include the peak travel period, a further increase of reported
problems must be anticipated. It should also be noted that ECC-Net only accepts cross-border
consumer cases. This means that ECC-Net does not
record those cases in which the consumer and airline
originate from the same country.
Figure 7-13: Various reasons for complaints in 2006
Source: ECC-Net: Air Passenger Rights: Consumer complaints 2006.
December 2007
The number of enquiries concerning air transport
related complaints received by ECC-Net from different
European countries varies. Most of the complaints
come from Ireland, Sweden and Germany. The ECC-
Net cannot explain why the complaint frequency is not
proportional to the total number of passengers from
individual countries. It is worth noting that more
complaints are received from countries with relatively
low populations (such as Ireland, Sweden and Norway)
than from, for example, the UK, the country with the
largest number of passengers. ECC-Net suspects that the reason the Irish file the most
complaints may be linked to the fact that the largest European low-price airline is based in the
country. Consequently, local media reports about customer rights are likely to be particularly
detailed. A further factor is that the Irish tend to travel by air due to their geographical position
separate from the European mainland. High complaint rates are also generally associated with
well-developed Alternative Dispute Resolution systems, good domestic law coverage and a
healthy culture of pursuing complaints.
Luggage related
Cancellation
Delay
Denied boarding
Other air pax related
0%
25%
50%
75%
100%
Reason distribution of
complaints 2006
Total: 2,979 complaints
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Table 7-2: Complaints registered by ECC-Net per
country
Source: ECC-Net
7.5 Hidden Charges
When drawing up their prices, the extent to
which airlines make use of the options
available to them to charge for certain
services separately varies, even in cases
where these services were previously part of
the service provided or were not normally
stated separately before. This gives airlines
the opportunity, in the face of increasing
competition, to offer an apparently very
competitive price for the basic service. The
excluded services are then charged to those
customers who actually want to or have to
use these services. This division of charges
leads to certain loss of clarity in the pricing,
especially as the extra charges are often only
stated in the small print. The Airport Users
Council (AUC) refers to four typical
supplemental charges of which customers
should be particularly aware. Such charges
may become due when gift vouchers are
used to buy air tickets, if an application is
made for a refund of taxes and charges, or
when contacting the airline by telephone. In
this context it is notable that the revised
"third package" (concerning Regulations (EC) No 2407/92, 2408/92 and 2409/92) imposes the
publication of all-inclusive prices with clear indication of the attached conditions in order to
allow consumers to effectively compare ticket prices.
7.6 Refund of Taxes, Fees and Charges
In 2002 the majority of EU airlines agreed to abide by the European Civil Aviation Conference's
Passenger Service Commitment (ECAC-PSC), since which time the airlines have generally been
prepared to refund taxes, fees and charges (TFCs). This agreement is particularly significant for
non-refundable tickets of the type typically sold in the lower price segment. Non-refundable
tickets often have a very low basic price, which is naturally excluded from any refund. The taxes,
fees and charges declared separately however often add up to the largest proportion of the total
Country
of consumer
total share
Ireland 424 16%
Sweden 396 15%
Germany 274 10%
Spain 223 8%
Italy 207 8%
Belgium 193 7%
Poland 162 6%
Portugal 105 4%
Austria 104 4%
France 76 3%
Norway 70 3%
UK 69 3%
Greece 57 2%
Luxemburg 43 2%
Lithuania 40 2%
Finland 37 <1%
Denmark 24 <1%
Netherlands 18 <1%
Latvia 13 <1%
Slovakia 12 <1%
Czech Republic 11 <1%
Estonia 10 <1%
Hungary 10 <1%
Malta 9 <1%
Cyprus 9 <1%
Bulgaria 3 <1%
Slovenia 2 <1%
Switzerland 2 <1%
Iceland 1 <1%
Outside EEA 20 1%
unknown 6 <1%
TOTAL 2630 100%
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cost of the ticket. Since these TFCs are stated separately, the customer is justified in expecting
that these be refunded if the ticket is not used (source: Airport Users Council AUC). Some
airlines however charge a standard fee for these refunds. These standard fees – often hidden in
the small print – are sometimes so high that a refund is no longer worth claiming. This
mechanism allows the airlines to keep down the number of refund applications, meaning that
they retain the TFCs.
7.7 Persons with Reduced Mobility: Regulation (EC) 1107/2006
About 10% of European inhabitants are considered to have reduced mobility. A mandatory
regulation is now in force that ensures their more equitable treatment in air transportation. For
this Regulation, please refer to point 5.5.2 in the “Regulatory” chapter.
7.8 Cabin Seating
When planning an air trip the customer is often to decide between offers of two or more
airlines. Besides the prices, times and associated services, as for example lounge utilisation or
bonus points, the customer may factor seat comfort into consideration. A very important
influence on seat comfort is gained by the dimension seat pitch. The seat pitch is defined as the
interspace between the seat rows. In difference to the dimension “legroom”, the seat pitch
indicates the distance between same seat shapes of back-to-back installed seat rows. According
to the most commonly used
booking categories, the four
classes Economy, Premium
Economy, Business and First
are plotted with their spans in
Figure 7-14.
Figure 7-14: Range of seat
pitches used by European
airlines
Source: Skytrax, January 2008
As shown in the Figure, the
seat pitches tend to increase
with higher categories. But
there are differences within
and overlaps between
categories too. The biggest
differences must passengers
accept who have booked
Business class tickets. As indicated by Skytrax, customers are to expect seat pitches between
narrow-gauged 81 centimetres (Air Malta) and luxury 201 centimetres (Virgin Atlantic). The
mean value for the Business class is 128 cm which is close to the median value 127 cm. This
closeness of values indicates that the distribution has no significant outliers.
229
201
97
84
211
128
91
79
198
81
84
71
0 50 100 150 200 250
First
Business
Premium
Economy
Economy
seat pitch (in cm)
minimum
Mean seat pitch
maximum
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Table 7-3: Seat pitches used by
European airlines
Source: Skytrax
Airline First Business
Premium
Economy Economy
specifications in centimetres
Aer Lingus 132 81
Aegean Airlines 84 81
Aeroflot 157 81
Air France 208 155 79
Air Madrid 119 81
Air Malta 81 76
Alitalia 140 81
Austrian Airlines 155 81
Belair 107 79
British Airways 198 185 97 79
BMED 127 81
bmi British Midland 152 97 81
bmi baby 74
Britannia Airways 89 76
Cyprus Airways 107 81
Czech Airlines 119 81
Delsey Airlines 157 81
easyJet 74
Eos Airlines 183
Estonian Air 84 84
Excel Airways 114 86 76
Finnair 160 81
First Choice (long haul) 91 84
First Choice (short haul) 84 71
flyBe 79
GB Airways 86 79
Iberia 152 81
Icelandair 99 79
Iceland Express 79
JAT Airways 91 81
K L M 152 79
Lauda Air 127 79
L'Avion 119
LOT Polish Airlines 145 81
LTU International 107 76
Lufthansa 229 152 81
Luxair 81 81
Malev Hungarian 102 81
Meridiana 81 81
Monarch Airlines 86 74
MyTravel Airways 89 76
Olympic Airways 147 84
PGA Portugalia 84 81
Ryanair 76
SN Brussels Airlines 157 79
SAS Scandinavian 152 94 81
Silverjet 168
Snowflake 79
Spanair 114 79
Swiss 211 122 79
Tarom Romanian 107 81
TAP Air Portugal 147 84
Thomsonfly (long haul) 94 84
Thomsonfly (short haul) 86 74
Thomas Cook 97 76
Turkish Airlines 137 81
Ukraine Int'l 86 76
Virgin Atlantic 201 97 79
Virgin Express 76
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8 Aircraft and Engine Manufacturers
8.1 Highlights of 2007
Airbus: A380 Delivery
With a delay of about 18 months, Airbus handed over the first A380 to Singapore Airlines on
15
th
October 2007 in Toulouse. Entry into service took place a few days later on 25
th
October
with a flight from Singapore to Sydney. Airbus expects to deliver 6 A380 aircraft in 2008 to both
Emirates and Singapore Airlines. In 2007, the European manufacturer received 33 new orders
for the A380, with British Airways (12 units) and Emirates (11 units) as largest customers in
2007. Among the customers is also the Saudi-Arabian Prince Alwaleed who ordered one A380
as private jet.
Airbus: Milestone 5,000
th
Delivery
On 14
th
December 2007, Airbus celebrated the delivery of its 5000
th
aircraft, an A330-200 for
Australian operator Qantas. Starting in 1974 with the first delivery of an A300, it took Airbus 19
years to deliver its 1000
th
aircraft. Only six years later, in 1999, this number was doubled, with
another three years for the next thousand aircraft. Aircraft production continues to accelerate
and with a potential production rate of about 50 aircraft per month, it is likely to take less than
two years until the next milestone with the 6000
th
delivery will be reached. With an order
backlog of 3613 aircraft at the end of 2007, even the 10,000
th
delivery is on the horizon.
Boeing: 787 Rollout
On 8
th
July 2007, Boeing presented its newest widebody aircraft, the B787 (‘Dreamliner’) to the
public. This event marked the first rollout of an all new type since the 777 in the mid-90s. This
aircraft is already, ahead of its first flight, facing strong demand from airlines around the world.
With 363 orders in 2007, the order book stood at 817 units at the end of 2007. The 787 project
also has high relevance for suppliers from the European Union, with a relatively high share of
European suppliers and project partners. For instance, major fuselage components are
manufactured by Alenia of Italy, Latecoere of France and Saab of Sweden. Messier-Dowty from
France supplies the landing gear and Thales several electrical power components. Besides
engines from US-manufacturer General Electric, customers may choose Trent1000 engines made
by Rolls Royce in Derby (United Kingdom).
As the development of a new aircraft is among the most challenging industrial endeavours,
unforeseen delays in the development have also hit Boeing with its 787. In autumn 2007, the
first flight had to be delayed for about 6 months, apparently due to some shortages of supply
materials and required improvements in the flight control software.
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Sukhoi Superjet Rollout
26
th
September 2007 constituted a significant date for the Russian aerospace industry. For the
first time in years, a new aircraft, the Sukhoi Superjet, was presented to the public. The aircraft
is placed in the growing market segment of aircraft with 75 to 100 seats, designed to replace
aging soviet type aircraft and also intended for the export market, increasing competition in the
duopoly market currently dominated by Bombardier and Embraer. At the end of 2007, the order
book stood at 74 firm orders. In this project, European partners also play an important role.
Prime project partners and suppliers are Alenia with a 25% share in the Sukhoi Civil Aircraft
Corporation (SCAC), Thales, which provides the flight instrumentation and Liebherr (climate
packs and flight control systems). The aircraft is powered by the SaM-146 engine, developed
jointly by Snecma and Saturn NPO.
Chinese Regional Jet Rollout
Also in China, a new regional jet model was presented to the public, the ARJ21
“Xiangfeng”/”Flying Phoenix”. Rollout took place 21
st
December 2007. The aircraft was
developed to a large extent by Chinese Corporations and will be powered by General Electric
CF34 engines. European participation in this new development was relatively small compared to
the Sukhoi Superjet or the Boeing 787.
Airbus Final Assembly Line in China
On 15
th
May 2007, construction for the new A320 final assembly line started in the Chinese city
of Tianjin. The first aircraft from this new line shall be delivered in 2009, in 2011 production rate
should be set at four aircraft per month.
8.2 Aircraft Market Overview
8.2.1 Aircraft Orders Overview
The strong demand for passenger aircraft, which emerged in the last couple of years, continued
in 2007, breaking all records formerly set. Particularly demand by low cost airlines and by airlines
based in emerging markets contributed to growing order books for airframe and engine
manufacturers. Particularly the market for single-aisle jets over 100 seats was very strong and
Boeing and Airbus combined were able to pick up more than 1800 orders in 2007 for the A320
family and the Boeing 737.
2007 was the most successful year for aircraft manufacturers in terms of new aircraft orders.
More than 3500 passenger aircraft have been ordered. In addition to this, almost 1100 business
jets and 222 cargo aircraft orders were recorded. The surge in orders is not yet fully reflected in
deliveries. 1181 passenger aircraft were delivered, which is about the same level as seen in the
boom years before 2001.
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Figure 8-2: Passenger aircraft orders and deliveries from 1998 to 2007
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
0
500
1000
1500
2000
2500
3000
3500
4000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
No. of Aircraft
Passenger Aircraft Orders Passenger Aircraft Deliveries
Table 8-1: Geographical Breakdown Origin of Commercial Passenger and Cargo Aircraft Orders by
Operator Area
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
North America was the most
important market for
commercial passenger and
cargo aircraft in 2007, leading
with a 25.0% share ahead of
Asia. The third most
important market is
geographical Europe, with
815 orders and a share of
23.3%. More than 70% of
the orders from operators in
Europe came from Member
States of the European Union.
Operator Area Total Aircraft Percentage Share
North America 873 25.0%
Asia 828 23.7%
Europe 815 23.3%
Thereof:
- EU-27 577 16.5%
- Rest of Europe 238 6.8%
Middle East 534 15.3%
Latin America and
Caribbean 231 6.6%
Australasia 155 4.4%
Africa 62 1.8%
Subtotal 3498 100.00%
Unknown area 245
Total 3743
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8.2.2 Aircraft Orders by Market Segments, Manufacturers and Types
On the market for widebody jets operating economics due to increases in fuel prices favoured
the demand for twin-engine jets, particularly the Airbus A330 and Boeing 777. On the other
hand, the four-engine Airbus A340 achieved only limited sales (14 units), while not a single unit
of the passenger version of the B747-400 has been sold for years now. Strong demand could be
seen for the Airbus A350 and Boeing 787 due to increased operational economies in
comparison to their respective successor types. 2007 marked a breakthrough in sales for the
A350XWB with a total of
290 orders.
Table 8-1: Cargo and Passenger
Gross Aircraft Orders by
Manufacturer 2007
Source: Analysis of DLR Air
Transport and Airport Research
based on data provided by Ascend
In 2007, Boeing received
not a single order for the
747-8 passenger version by
an airline. However, 24
cargo versions and one
business jet version have
been sold. With Airbus, the
A380 received 32 orders,
among them an order for
12 units by British Airways.
By the end of 2007, 14
airlines plus ILFC as an
aircraft leasing company
and the Saudi-Arabian
Kingdom Holding as
operator of the private jet
for Prince Alwaleed have
committed to buy 189
A380s.
The competition in new
orders and deliveries of Airbus vs. Boeing, highly acclaimed by the public and aviation
stakeholders was very closely decided only in the last quarter of 2007. Airbus received 1555
orders in 2007, compared to 1389 for Boeing. At list prices, the orders for Airbus have a value
of 180.7 billion US-$, the value of aircraft ordered with Boeing amounted to 168.5 billion US-$.
The biggest single orders for Airbus came from Arabian carriers: Emirates ordered 50 A350-900,
Manufacturer
No of
Aircraft Ordered
Value in million US-$
(in 2007 list prices)
Airbus 1555 180,723
Boeing 1398 168,549
Bombardier 250 7567
Embraer 179 6586
ACAC 100 3000
ATR 105 1845
Ilyushin 43 793
Viking Air 26 83
Xian 22 132
Tupolev 19 836
Antonov 18 244
Sukhoi 12 300
Utility Aerospace
Industries
10 68
Aircraft Industries -
Let 3 3
Yunshuji 3 12
Total 3743 370,741
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with a total list price value of 10.8 billion US-$, followed by an order of Qatar Airways for 40
A350-800 at a list price value of 7.6 billion US-$. The biggest single orders for Boeing were
placed by leasing company ILFC for 49 787-8 with a value of 7.9 billion US-$ and again Qatar
Airways for 30 787-8 and 4.9 billion US-$ order value at list prices. In addition to the firm
orders, customers also placed options/letters of intent, which are not considered in this
summary.
Table 8-2: Gross orders of Airbus aircraft,
breakdown by type
Source: Analysis of DLR Air Transport and
Airport Research based on data provided by
Ascend
Table 8-3: Gross orders of Boeing aircraft, breakdown by type
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Aircraft Type 2007 2006
Percentage
Change
B737NG (-600/-700/-800/-900/-900ER) 832 739 +12.6%
B747-400F/ERF 0 12 -
B747-8/-8BBJ 0 24 -
B747-8F 24 36 -33.3%
B767-300ER 3 10 -70.0%
B767-300ERF 33 0 -
B777-200/-200ER/-200LR/-300/-300ER 115 44 +161.4%
B777-200LRF 28 33 -15.2%
B787 363 160 +127%
Total 1389 1058 +31.3%
Aircraft Type 2007 2006
Percentage
Change
A318/319/320/321 1017 723 +40.7%
A330-200/-300 136 105 +29.5%
A330-200F 66 0 -
A340-300/-500/-
600
14 15 -6.7%
A350XWB 290 2 -
A380 32 17 +88.2%
Total 1555 862 +78.9%
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The breakdown by aircraft of both Boeing and Airbus reveal their particular strengths and
weaknesses in the market. Airbus has sold only very few A340s. It is perceived that Boeing’s 777
model, which offers variants with about the same payload/range capabilities as the A340,
operates more fuel efficiently, as it has only two engines compared to four on the A340.
Boeing’s new 747-8 model has not achieved a single order for the passenger version in 2007
after Lufthansa became launch customer in 2006. The last order for the passenger version of the
747-400 was made in the year 2002. Here as well it is perceived that airlines prefer large
versions of the 777 (-300 and -300ER) with a slightly lower maximum payload/maximum
number of seats as twin-engined jet over the four-engined 747.
When looking at aircraft orders made in 2007, it is also important to mention the cancellations
of firm orders that occurred. Airbus had to cope with 117 cancellations throughout 2007, of
which 72 were attributable to the A350, 26 to the A340 and 10 to the A380. Boeing, however,
only had to accept 10 cancellations.
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Table 8-4: Order backlog (commercial customers) at 31st December 2007 for passenger and cargo aircraft
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Manufacturer No. of Aircraft
Value in million US-$
(in 2007 list prices)
Airbus 3105 352,679
Boeing 2091 322,252
Embraer 430 15,982
Bombardier 270 8293
ACAC 135 4050
Tupolev 77 3351
ATR 178 2927
Sukhoi 98 1975
Ilyushin 94 1856
Antonov 112 1576
Utility Aerospace Industries 46 311
Xian 46 276
Viking Air 26 83
Yunshuji 8 30
Aircraft Industries - Let 2 2
Total 6718 715,642
Among the airlines from EU-27, the Lufthansa Group ordered the largest number of new aircraft
in 2007, with 86. The majority of these orders is for smaller regional and short-haul aircraft.
Lufthansa is followed by British Airways with 56 new aircraft orders. Other than Lufthansa, the
majority of orders by the carriers from the UK came for long-haul aircraft, such as the newly
developed Boeing 787 and also the Airbus A380. The largest order from a low cost carrier came
from the Hungarian airline Wizz Air for 50 Airbus A320.
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Table 8-5: Major new Aircraft Orders by Airlines from EU-27
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Operator Total No. of Aircraft
ordered 2007
Type Split
Lufthansa Group 86 30x Embraer 190LR (Lufthansa Cityline)
20x Airbus A321 (Lufthansa)
15x Bombardier CRJ 900 (Lufthansa
Cityline)
9x Airbus A330-300 (Swiss)
6x Airbus A319-100 (Lufthansa)
2x Airbus A320-200 (Swiss)
4x Airbus A320 (Lufthansa)
British Airways 56 16x Airbus A320-200
16x Boeing 787-9
12x Airbus A380-800
8x Boeing 787-8
4x Boeing 777-200ER
Wizz Air 50 50x Airbus A320-200
Air France-KLM 45 14x Embraer 190LR
10x Boeing 737-700 (KLM)
9x Boeing 777-300ER (Air France)
6x Embraer 170LR
2x Airbus A380-800 (Air France)
2x Boeing 777-300ER (KLM)
2x Airbus A330-200 (KLM)
easyJet 35 35x Airbus A319-100
airberlin 35 25x Boeing 787-8
10x Bombardier Dash8-400
Ryanair 27 27x Boeing 737-800
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Orders for General Aviation Aircraft
Other than the market for regional, short to medium and long-haul aircraft, which are
dominated by very few aircraft manufacturers, the market for aircraft used in general aviation is
increasingly diverse in both the number of manufacturers and the types and sizes of aircraft
available. The market as depicted in Table 8-6 covers a range from the very light jet with a
maximum take-off weight of less than 4000kg for 4-6 passengers up to the Boeing 747-8BBJ
with a maximum take-off weight of more than 440,000kg and an interior space that could seat
more than 500 passengers in a commercial airline configuration.
Table 8-6: Orders for Business Jets 2006/2007
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Manufacturer
No. of
Business Jets
ordered in
2007
No. of Business
Jets ordered in
2006
Percentage
change
Cessna 370 223 +65.9%
Eclipse Aviation 179 161 +11.2%
Embraer 170 231 -26.4%
Hawker Beechcraft 136 208 -34.6%
Bombardier 57 188 -69.7%
Adam Aircraft Industries 50 147 -66%
Grob Aerospace 35 0 -
Airbus
1
33 20 +65%
Dassault Aviation 22 169 -87.0%
Boeing
2
24 20 +20%
Gulfstream Aerospace 15 36 -58.3%
Israel Aerospace Industries 2 32 -93.8%
Honda 1 0 -
Diamond Aircraft Industries 1 20 -95%
Total 1095 1455 -24.7%
1
The 2007 figure for Airbus includes two A330 and four A340 to be configured as business jets
2
The 2007 figure for Boeing includes one 747-8 and five 787 to be configured as business jets
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8.2.3 Aircraft Deliveries by Market Segments, Manufacturers and Types
Airbus delivered ten aircraft more than Boeing. The final count stood at 445 versus 435
deliveries to commercial operators in 2007. However, when it comes to the value of delivered
aircraft, Boeing is slightly ahead, as the Chicago-based company delivered 325 single-aisle jets
and 110 widebodies, while Airbus delivered 361 single-aisle jets and 84 widebodies. Translated
into the value of the delivered aircraft at list prices, those delivered by Boeing had a value of
48.6 billion US-$, compared to 40.8 billion US-$ for Airbus.
Table 8-7: Passenger and Cargo Aircraft Deliveries to Commercial Operators by Manufacturer 2006/2007
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Manufacturer 2007 2006
Percentage
Change
Airbus 445 424 +4.9%
Boeing 435 379 +14.8%
Embraer 124 99 +25.3%
Bombardier 112 115 -2.6%
ATR 42 24 +75%
Harbin Embraer Aircraft Industry 7 4 +75%
Tupolev 6 2 +200%
Ilyushin 4 4 +/- 0%
Xian 4 5 -20%
Aircraft Industries - Let 4 2 +100%
Antonov 1 1 +/- 0%
Total 1184 1059 +11.8%
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Table 8-8: Values of Passenger and Cargo Aircraft Deliveries by Manufacturer at Average List Prices
2006/2007 in million US-Dollars
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Manufacturer 2007 2006
Percentage
Change
Boeing 48,608 40,911 +18.8%
Airbus 40,765 40,610 +0.4%
Embraer 3767 2610 +44.3%
Bombardier 3478 3171 +9.7%
ATR 716 430 +66.7%
Tupolev 227 51 +345.1%
Ilyushin 105 34 +213.1%
Harbin Embraer Aircraft Industry 88 88 +/-0.0%
Xian 36 30 +20.0%
Antonov 9 9 +0.0%
Aircraft Industries - Let 4 2 +100.0%
Yunshuji 0 10 -100.0%
Total 97,803 87,956 +11.2%
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Table 8-9: Deliveries of
Airbus aircraft to
Commercial Operators,
breakdown by type
Source: Analysis of DLR Air
Transport and Airport Research
based on data provided by
Ascend
Table 8-10: Deliveries of Boeing aircraft to Commercial Operators, breakdown by type
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Aircraft Type 2007 2006
Percentage
Change
B717 0 5 -100%
B737NG (-600/-700/-800/-900/-900ER) 325 285 +14.0%
B747-400F/ERF 16 14 +14.3%
B767-300ER 8 7 +14.3%
B767-300ERF 3 3 -
B777-200/-200ER/-200LR/-300/-300ER 83 65 +27.7%
Total 435 379 +14.8%
With the delivery of an A300-600RF to FedEx on 17
th
July 2007, Airbus ended production of the
very aircraft type, which actually was the first model with which the company entered the
market for large jetliners in 1974. The example of the A300, which was in production for 34
years shows the long product life cycle in the aircraft industry. Throughout 2007, an average of
almost one aircraft of the A320 family was delivered per day. Aircraft of this family were the
most frequently built type in 2007 (361 units), followed by the B737NG (325 units).
The strong demand from low cost carriers and carriers from emerging markets is also reflected
in deliveries. Biggest customers as far as deliveries from Airbus are concerned are TAM Linhas
Aereas from Brazil with 20 aircraft delivered in 2007, easyJet with 16 aircraft and China
Southern with 16 aircraft. Boeing’s largest customers are Southwest Airlines (37 deliveries in
2007), Ryanair (35) and Jet Airways, China Southern and GOL Linhas Aereas (15 aircraft each).
Aircraft Type 2007 2006
Percentage
Change
A300-600RF 6 9 -33.3%
A318/319/320/321 361 331 +9.1%
A330-200/-300 66 61 +8.2%
A340-300/-500/-600 11 23 -54.2%
A380 1 0 -
Total 445 424 +5.0%
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The market for regional jets has recently been developing into larger aircraft sizes. The smallest
types (e.g. CRJ 200 and ERJ135) with 30-50 seats have seen a strong decline in demand while
larger types (75-120 seats) have seen increasing demand. This is also reflected in the number of
delivered aircraft. Bombardier delivered 59 CRJ regional jets for airline use, all of the larger CRJ-
700 and -900 type. Embraer delivered 125 regional jets to airlines, all belonging to the
170/175/190/195 types. The Chinese joint venture of Embraer and Harbin delivered seven
smaller ERJ-145s to Chinese customers.
Due to high fuel prices, turboprop aircraft have recently experienced a renaissance. While the
boom in smaller regional jets that were introduced at the end of the 1990s ended with high fuel
prices, demand has increased for fuel-efficient turboprop aircraft. The market for turboprops is
similar to the markets for larger single aisle, twin aisle and regional jets as it is dominated by
only two major manufacturers: ATR, a company jointly owned by Alenia from Italy and EADS,
and Bombardier from Canada. Orders in 2007 have considerably increased in comparison to
2006. ATR picked up 105 orders in 2007, up from 68 in 2006, while Bombardier received 88
orders in 2007 compared to 49 in 2006. Bombardier delivered 53 Dash-8 aircraft in 2007
compared to 45 in 2006 to commercial operators, ATR delivered 40 ATR42 and 72 aircraft after
24 in 2006.
Freighters also continue to be in strong demand. Most notably, Airbus' A330-200F (65t payload)
will become an important product in the small widebody freighter segment, replacing older
A300s and B767s. Airbus received 66 orders in 2007 for its new freighter, which is scheduled to
enter service in the second half of 2009. For Boeing, an important step was the order from UPS
at the end of January for 27 B767-300ER freighters, which will enable Boeing to keep the
production line for this type of aircraft open until a final decision is made for the new tanker
aircraft for the US Air Force. This tender represents one of the largest military aircraft purchasing
competitions in the world with an estimated value of 40 billion US-$. Airbus is also competing
with its A330 type.
In the market for large midsize-freighters, Boeing received 28 orders for its 777-200LRF,
primarily from leasing companies. The aircraft is placed in a market where a strong demand can
be expected, as it will replace older MD-11s and 747-200F. Entry into service is expected for the
fourth quarter 2008.
In March 2007, Airbus postponed the development of the freighter variant of the A380.
Important customers such as FedEx and UPS cancelled their orders after Airbus announced that
it could not hold the expected delivery schedule for 2012.
An important element in the freighter market is also conversions from passenger variants. In
2007, a total of 130 passenger aircraft were converted into freighters. Aircraft chosen for
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conversion had an average age of 17.6 years and were in most cases too expensive to operate
as passenger aircraft.
Table 8-11: Conversions of Passenger Aircraft into Freighters 2007
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Deliveries of General
Aviation Aircraft
The market for general
aviation aircraft is very
heterogeneous and the
range of aircraft in this
market segment stret-
ches out from small,
one-engine piston air-
craft up to specially
customised jets like the
Airbus A319CJ or the
Boeing 737BBJ. Occa-
sionally, aircraft manu-
facturers even receive
orders for large inter-
continental wide-body
jets to be customised as
private jets. The market
leader in the segment of
small piston-engine
aircraft up to business jets being capable of intercontinental flights is the Cessna Aircraft
Company, based in Wichita, Kansas. Cessna delivered 1274 aircraft in 2007. The total number
of 4272 general aviation aircraft produced in 2007 splits into 2417 single-engine piston aircraft,
258 multi-engine piston aircraft, 459 turboprops and 1138 business jets. The type with the
highest number of aircraft produced in 2007 was the SR22 with 588 units, manufactured by the
Duluth, Minnesota based manufacturer Cirrus, followed by the Cessna Skyhawk 172/172S SP
with 373 units. The most important market for general aviation aircraft is North America with
3425 deliveries, followed by geographical Europe with 712. 36 aircraft were delivered to South
America and 99 to the rest of the world.
Aircraft Type No. Of Conversions in 2007
Airbus A300/A310 18
ATR 42/72 6
Bae ATP 9
Boeing 737 30
Boeing 747 25
Boeing 757 8
Boeing 767 8
Boeing (McDonnell-Douglas) DC-10 1
Boeing (McDonnell-Douglas) MD-11 12
Bombardier CRJ200 2
Embraer EMB-120 1
Fokker 50 1
Ilyushin 62 1
Saab 340 8
Total 130
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Table 8-12: General Aviation Aircraft Manufacturers
Source: General Aviation Manufacturers Association
Rank Manufacturer
No. of General
Aviation Aircraft
Delivered
Total Value of
General Aviation
Aircraft Delivered
in Mio. US-$
1 Bombardier 226 5200
2 Gulfstream Aerospace Corp. 138 4828
3 Cessna Aircraft Company 1274 3909
4 Dassault Falcon Jet 70 2317
5 Hawker Beechcraft Corp. 351 1889.3
6 Embraer 36 889.7
7 Airbus 12 600
8 Raytheon Aircraft Company 79 378
9 Boeing 7 345
10 Cirrus Design Corporation 710 338.3
11 Pilatus 92 307
12 Diamond Aircraft 471 185
13 Piper Aircraft, Inc. 221 174.4
14 Piaggio Aero 21 130
15 Eclipse Aviation 98 121.3
16 Columbia Aircraft 152 77.7
17 Socata EADS 17 46
18 Mooney Aircraft 79 42.9
19 Pacific Aerospace Ltd. 10 15
20 American Champion Aircraft 70 7.6
21 Sino Swearingen 1 6.6
22 Liberty Aerospace 38 6
23 Maule Air, Inc. 36 4.5
24 Adam Aircraft 3 3.6
25 Alpha Aviation 13 2.1
26 Quest Aircraft Company 1 1.3
27 Gippsland Aeronautics 17 n.a.
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8.3 Engine Market Overview
As the demand for new aircraft was surging in 2007, the demand for engines was also very
strong. The European aeronautical industry is also very well positioned on the engine market.
The biggest manufacturers are MTU from Germany, Rolls Royce from the United Kingdom and
Snecma from France.
As the development of new engines is very expensive, usually consortia form and share the risks
of development. The most successful consortia on the engine market are CFM International, a
joint venture between General Electric and Snecma and International Aero Engines, a
cooperation between Rolls Royce, Pratt&Whitney, MTU and JAEC. The companies cooperating in
these consortia have been successfully working together for several decades. Among the newer
engine consortia are the Engine Alliance, a joint venture between GE and Pratt&Whitney for the
development of the GP7000 engine used for the Airbus A380 and PowerJet, a cooperation
between Snecma and NPO Saturn from Russia. This consortium is working on the SaM-146
engine, which will power the Sukhoi SuperJet.
The engine market for different airframe types shows a heterogeneous picture: While for some
types two or even three rivalling manufactures offer their engines, for other airframe types only
one family of engines is available. To the first group belong for instance the A320 family with
engines available from IAE and CFM and the A330 (engines from GE, Pratt & Whitney and
CFM). To the latter group belong the Boeing 737 family (sole engine supplier CFM), the Airbus
variants A340-500 and -600 (sole supplier Rolls Royce) and the larger Boeing 777 variants
(-200LR and -300ER) with General Electric as the only engine supplier.
An interesting new development has occurred with the Boeing 787, which has engines available
made either by General Electric or Rolls Royce. With this type, it will be possible to interchange
the engine type on a specific airframe without the need of a lengthy recertification process. This
makes the 787 a very flexible asset on the second hand market, as airliners can be sold from GE
to Rolls Royce engine users and vice versa while maintaining the commonality of a single engine
type and the resulting cost savings in spare parts logistics and maintenance crew training.
The engine aftersales market is gaining increasing importance. For instance, International Aero
Engines offers for its V2500 engine family, which is used for the Airbus A319/320/321, a
program called “Select” designed to increase maintenance intervals and to increase fuel
efficiency by the introduction of improved parts into the existing engine population.
Interestingly, several manufacturers have also begun to build spare parts for engines from
competing manufacturers – a fact that further underlines the importance of the aftersales
market.
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Table 8-13: Engine and Market Share Breakdown on Aircraft Ordered in 2007 (without spare engines)
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Engine Manufacturer Engines ordered
Engine
Manufacturer
Share of total no.
of engines on
ordered Aircraft in
2007
CFM International 2350 36.4%
General Electric 1558 24.1%
Rolls Royce 950 14.7%
International Aero Engines 632 9.8%
Pratt & Whitney 540 8.4%
Klimov 196 3.0%
Aviadvigatel 132 2.0%
Engine Alliance 68 1.1%
PowerJet 24 0.4%
Walter 6 0.1%
Subtotal Announced Engine Orders 6456 100.0%
Unannounced 1038
Total No. Of Engines on ordered Aircraft 7494
The highest number of engines to be installed on newly ordered aircraft in 2007 comes from
CFM with 2350 engines, which represents 36.4% of all engines to be installed on new aircraft.
CFM benefited from the strong demand for the standard single-aisle aircraft from Boeing and
Airbus, as this manufacturer provides engines for the 737 and the A320 family. Moreover, the
CFM56 engine can also be used on the A340-200 and -300, which however only accounted for
four sold airframes and 16 engines to be installed. For the Boeing 737, CFM is the exclusive
engine provider. The main airframe types to be equipped with engines from General Electric will
be regional jets from Embraer and Bombardier as well as the top of the market 777 models 777-
300ER and -200LR, where it is exclusive provider. Number three on the list, Rolls Royce,
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benefited in 2007 strongly from the position as exclusive engine provider for the A350XWB. 558
of 950 or almost 60% of Rolls Royce’s total orders account for the Trent 1700 engine for the
A350XWB.
As it is possible to order the airframe without committing to a specific engine at the time of
ordering, the buyers still have to decide on the engine for a significant number (1038 or almost
14% of the total orders) of airframes.
Table 8-14: Engine and Market Share Breakdown on Aircraft Delivered in 2007 (without spare engines)
Source: Analysis of DLR Air Transport and Airport Research based on data provided by Ascend
Engine Manufacturer
Installed Engines on
Delivered Aircraft
Engine Manufacturer
Share of total no. of
engines on ordered
Aircraft in 2007
CFM International 1092 44.9%
General Electric 646 26.6%
International Aero
Engines
278 11.4%
Pratt & Whitney 250 10.3%
Rolls Royce 128 5.3%
Aviadvigatel 29 1.2%
Walter 8 0.3%
Total 2431 100%
Also for the aircraft delivered in 2007, CFM International was the No. 1 engine supplier with 10
engines. This represents 44.8% of all jet and turboprop engines installed on newly delivered
aircraft. 650 of their engines are installed on Boeing 737 aircraft, 434 on Airbus
A318/319/320/321 with the remaining eight on two A340s. CFM is followed by General
Electric, which delivered 366 engines for regional jets of Embraer and Bombardier, 140 CF6
engines used on Airbus A300 and A330 as well as the Boeing types B747 and B767. The
remaining 140 engines are the GE90 type, installed on Boeing 777 aircraft.
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9 Employment in European Air Transport
The following analysis of employment trends with respect to the European air transport sector is
based on the European Union Labour Force Survey (LFS). Data on employment trends of the
economic sector, air transport, and the entire national economy have been provided by the
Statistical Office of the European Communities (EUROSTAT) in cooperation with the German
Federal Statistical Office.
9.1 Basic Concepts and Definitions of the EU Labour Force Survey
The survey
68
is intended to cover the whole of the resident population, i.e. all persons whose
usual place of residence is in the territory of the Member States of the European Union,
excluding the population living in collective households.
The definitions of employment (and unemployment) used in the EU Labour Force Survey closely
follow those adopted by the 13
th
International Conference of Labour Statisticians.
A person (15 years and above) is considered as having an employment if he or she did any work
for pay or profit during the reference week. "Work” means any work for pay or profit during
the reference week, even for as little as one hour. Pay includes cash payments or "payment in
kind" (payment in goods or services rather than money), whether payment was received in the
week the work was done or not. Also counted as working is anyone who receives wages for on-
the-job training, which includes the production of goods or services.
This definition reveals the economic view of the Labour Force Concept. The objective is
collecting even minimal contributions to the value added.
9.2 Definition of Air Transport in the Scope of National Accounts
In the National Accounts air transport covers the following areas, according to the Statistical
Classification of Economic Activities
69
^
70
:
Scheduled air transport: passengers and goods
Non-scheduled air transport: passengers and goods (regular and occasional charter
flights, helicopter services, sightseeing flights, etc.)
Space transport: satellite and spacecraft launches as well as transportation of persons
and payload
68
European Communities: The European Union labour Force survey. Methods and definitions 2001.
Luxembourg 2003
69
European Commission: EU Labour Force Survey database. User guide. Luxembourg 2007
70
Statistisches Bundesamt: Klassifikation der Wirtschaftszweige mit Erläuterungen. Ausgabe 2003.
Wiesbaden. 2003
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9.3 Employment Trends in European Air Transport
The year 2001 was a significant milestone for international air transport. After the terror attacks
in the United States of America on September 11
th
, 2001 and the arising worldwide economic
slump, air transport demand decreased drastically. In 2004, air transport demand slowly started
to recover and in 2006 again reached the level of 2000.
This development has also been reflected – time-shifted – by the employment trends of airlines.
The peak was reached in 2001. The subsequent cut of employment continued until 2006. Only
in 2006, a rise of employment rates was seen. However, the absolute level has not (yet) reached
that of 2001 (Table 9-1).
Table 9-1: Number of Employees (1.000) – Air Transport
Source: EUROSTAT: Special Analysis of EU Labour Force Survey
EU-27 EEA D F UK I
1995 356 366 75 62 45 26
1996 363 372 75 51 39 33
1997 386 396 75 57 47 46
1998 395 408 79 55 46 37
1999 408 420 77 61 48 36
2000 428 440 78 70 56 41
2001 454 467 87 78 42 46
2002 439 449 84 83 43 54
2003 408 418 83 63 48 45
2004 412 422 76 66 47 40
2005 402 410 82 69 46 33
2006 422 430 87 56 51 33
From 1995 to 2001, the employment development in air transport in the EU-member states was
significantly more dynamic than that of the total sectors. Whereas, in this time frame, air
transport increased employment by 4.1% yearly, the total sectors only showed a yearly growth
rate of 1.0%.
Subsequently, the development changed significantly. In the air transport sector between 2001
and 2006 the number of employees yearly decreased by 1.5% in the EU-member states,
whereas it grew by 0.9% in total (Table 9-2).
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Table 9-2: Number of Employees (1.000) – National Economy
Source: EUROSTAT: Special Analysis of EU Labour Force Survey
EU-27 EEA D F UK I
1995 192.455 194.626 35.778 21.904 35.986 19.974
1996 193.544 195.792 35.629 22.019 26.276 20.093
1997 195.436 197.741 35.925 21.954 26.740 20.181
1998 197.282 199.659 35.626 22.243 27.050 20.354
1999 199.366 201.762 36.085 22.502 26.724 20.614
2000 201.751 204.172 36.321 23.119 27.082 20.927
2001 204.010 206.435 36.522 23.671 27.326 21.371
2002 203.995 206.436 36.209 23.877 27.477 21.755
2003 205.033 207.450 35.919 24.259 27.740 22.055
2004 205.544 207.966 35.455 25.005 27.923 22.434
2005 209.789 212.225 36.650 24.574 28.179 22.559
2006 213.843 216.354 37.374 24.765 28.333 22.985
In the entire time frame, the employment rate (1.7%) in the air transport sector yearly increased
slightly faster than that of the national economy (yearly 1.3%) (Figure 9-1).
Figure 9-1: Number of Employees (EU 15) – Air Transport, national Economy
Source: EUROSTAT: Special Analysis of EU Labour Force Survey
90
95
100
105
110
115
120
125
130
135
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
1995=100
Air Transport Total Sectors
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The employment portion of air transport is small with respect to the entire national economy. In
1995 it reached 0.18%, grew to 0.22% until 2001 and again decreased to 0.20% until 2006.
Also in big EU-countries like Germany, France, UK and Italy similar developments were seen.
2001 was the busiest year in all four states, apart from UK, where employment cuts already
started in 2001 and France starting in 2003. Subsequently, employment rates continuously
dropped until 2005 and rose again in 2006. In France, decrease of employment even continued
in 2006. Solely in Germany, the level of employment almost reached the one of 2001, whereas
in the other states it was significantly lower. This applies for the UK in the year 2000.
9.4 Coherence with other Employment Estimates
71
Key concepts used in national accounts, such as domestic employment, have no correspondence
in the EU-LFS, which uses instead number of persons employed based on residency within the
national border (national employment). There are also differences in coverage, where the EU-LFS
covers the age group 15 and older in private households only, while the national accounts cover
all persons regardless of age or residence. In addition, The EU-LFS doesn't consider conscripts
and unpaid trainees as employed whereas these are explicitly or implicitly accounted for in the
national accounts. The reference period for the measurement could also contribute to some
differences. The LFS represent one average week in the year with all the weeks of the year
measured. When data is derived from administrative sources or establishment surveys the
reference period is usually different, the month, the whole year or a single day within the year or
month.
It should be recognised that the coverage, measurement and conceptual differences mentioned
above only account for a relatively small part of the difference between the estimates. As a rule
of thumb, relative differences of more than 1.5% need to be explained by other reasons. This
would concern 12 participating countries. Germany and Italy are responsible for the bulk of the
absolute difference between the national account estimates and the LFS, with Bulgaria showing
the highest relative discrepancies. Six countries have discrepancies of more than 5%.
The reasons for the disparities, either in levels or in direction of the employment growth are not
fully known. Some indicative reasons can, however, be mentioned: national accounts may use
different sources to LFS (or LFS combined with other sources) to estimate employment. National
accounts may introduce adjustments to reach consistency between the employment reported by
its sources and other related variables (like salaries or production). The national accounts
approach of comparing and combining different sources is also more prone to underreporting or
systematic biases than LFS.
71
Eurostat: Quality Report of the European Union Labour Force Survey 2005. Luxembourg 2007
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The discrepancies between the Labour Force Concepts of national accounts and LFS increase
further when considering market sectors like air transport in this report. The following table
demonstrates this fact with the example of Germany (Table 9-3).
Table 9-3: Number of Employees (1.000) – German Air Transport
Sources: EUROSTAT: Special Analysis of EU Labour Force Survey, Statistisches Bundesamt
72
^
73
Labour Force Survey National Account
1995 75 47
1996 75 46
1997 75 46
1998 79 46
1999 77 49
2000 78 52
2001 87 53
2002 84 52
2003 83 53
2004 76 51
2005 82
2006 87
Thus, the data used in this report is not directly comparable with that used in the national
accounts. The LFS data have been chosen, since they are more comprehensive and up-to-date
than the national accounts data.
72
Statistisches Bundesamt: Fachserie 18. Reihe S.26: Volkswirtschaftliche Gesamtrechnungen.
Inlandsproduktberechnung. Revidierte Jahresergebnisse 1991 bis 2004. Wiesbaden. 2005
73
Statistisches Bundesamt: Fachserie 18. Reihe 1.4: Volkswirtschaftliche Gesamtrechnungen.
Inlandsproduktberechnung. Detaillierte Jahresergebnisse 2006. Wiesbaden. 2007
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10 Safety
10.1 Air Transport Safety
Safe operations remain the most important element of the air transport system. Continuous
efforts are undertaken by all stakeholders of the air transport system to guarantee safe
operations. This becomes particularly challenging as airports and airspace become more
populated due to the strong growth of air transport movements in the past years. The following
chapter provides an overview of notable events in the area of air transport safety in the year
2007 as well as statistical data related to safety, events concerning the list of airlines banned
from EU airspace and developments at the European Aviation Safety Agency (EASA).
10.2 Notable Events
The worst accident in 2007 happened in Brazil at Sao Paulo Congonhas Airport on 17
th
July. 181
passengers, 6 crew and 12 people on the ground were killed, as an A320 of TAM Linhas Aereas
overran the runway on landing in wet conditions and hit a cargo building. A fire broke out after
the impact and destroyed both the aircraft and the building. Contributing to the accident were
the weather conditions at the time of the accident, an ungrooved runway surface which had
been resurfaced shortly before and a defective right thrust reverser, which was not available for
landing. Two other accidents claimed more than 100 lives: On 1
st
January 2007, a Boeing 737-
400 of the Indonesian carrier Adam Air crashed into the sea off the coast of Makassar with 102
fatalities and on 5
th
May 2007, a Boeing 737-800 of Kenya Airways crashed immediately after
take-off near Douala (Cameroon), claiming 114 lives of passengers and crew.
The Canadian manufacturer Bombardier reported several technical problems on its Dash 8
regional turboprop aircraft type which have raised public concerns over the safe operation of
this aircraft type. Six occurrences were reported at airports in EU Member States where the
landing gear could not be properly extended prior to landing. Fortunately, no fatalities were
reported in these incidents. While the manufacturer is confident of solving the technical issues,
SAS has decided to withdraw all aircraft of this type from service. In total, 108 Dash 8 aircraft
were in service with operators based in Member States of the European Union at year end 2007.
The worst accident in terms of material damage happened on 15
th
November 2007, when an
Airbus A340-600 in the livery of Etihad Airways hit a concrete barrier in Toulouse during engine
test runs only a few days before delivery. The aircraft was damaged beyond repair, five of the
crew aboard where heavily injured.
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10.3 Safety Performance
Figure 10-1: Global Passenger and Crew Fatalities in Air Transport Accidents 1997-2007
Source: DLR Analysis based on Ascend Online Fleets
1239
1238
579
1168
1021
956
891
465
1054
944
208
230
169
153
190
200
149
107
167
134
682
97
0
250
500
750
1000
1250
1500
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Fatalities
Passenger Fatalities Crew Fatalities
Figure 10-1 presents the long-term development of passenger and crew fatalities in air transport
accidents 1997-2007. 2007 was a relatively safe year in comparison to the last years, 779 people
died in air transport accidents globally. This compares to an average of 956 between the years
1997 and 2006. Of those people killed in air transport accidents, 631 were passengers on
commercial flights.
A traditional indicator for the analysis of air transport safety is the number of fatal accidents per
million departures. According to the air transport information service ASCEND, 0.69 fatal
accidents happened per million departures globally in 2007, which corresponds to about 1.5
million flights per fatal accident. Historically, this is an excellent value, as the average over the
past 10 years is close to 1.0.
Also the number of passengers killed per million passengers carried is relatively low compared to
the long-term average. In 2007, the passenger fatality rate was 0.24 per million carried,
compared to an average of 0.32 for the time since 2000 and 0.56 during the 1990s.
The long-term view since 1990 in the following figure shows two opposing trends: The number
of flights grew considerably from 25.4 million in 1990 to 36.1 million in 2007, which is an
increase of more than 42%. The number of revenue passenger kilometres was even more than
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double from 2612 billion in 1990 to 5324 billion in 2007. At the same time, both the accident
rate measured by fatal accidents per million and the number of passengers killed per billion RPKs
declined considerably.
Figure 10-2: Long-term trend of fatal accidents and passengers killed in commercial aviation
Source: Ascend
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0.35
0.40
0.45
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Passengers killed per billion RPKs
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
1.80
Fatal accidents per million flights
Passenger Killed per Billion RPKs Fatal Accidents per Million Flights
Figure 10-3: Geographical Distribution of Air Transport Accident
Fatalities in 2007 (IATA Regions)
Source: Ascend Online Fleets
Europe
9.5%
Africa
23.6%
South America
28.5%
Middle East
4.5%
North America
0.3%
Asia Pacific
33.6%
The geographical distribution of fatal accidents reveals that
2007 was a particularly positive year for air transport in Europe and in North America. In the
3
71
0
25
50
75
Fatalities
Rest Europe (IATA Region excl. EU27)
EU 27
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European Union, commercial scheduled air transport did not result in a single fatality. The three
fatalities listed in the table below occurred during fire fighting actions in Greece and Italy. When
widening the view to geographical Europe (in the definition of IATA Regions), a total of 74
fatalities occurred in 2007, of which 56 were passengers on commercial, scheduled flight
operations. In North America, two fatalities were recorded. Aviation safety hotspots remain
areas where a weak regulatory environment and difficult economic conditions prevail. This is
particularly the case for several countries in Africa (175 fatalities), Asia Pacific (263 fatalities) and
South America (225 fatalities). In the Democratic Republic of the Congo alone, 39 persons died
in six fatal aviation accidents.
Table 10-1: Air Transport accidents with fatalities in 2007
Source: DLR Analysis, based on Ascend Online Fleets
Date Location Aircraft Type Airline/Operator
Passenger
and Crew
Fatalities
01 January 2007 off Makassar, Indonesia Boeing 737-400 Adam Air 102
09 January 2007 Balad, Iraq Antonov An-26 Aeriantur-M Airlines 34
07 March 2007 Yogyakarta, Indonesia Boeing 737-400 Garuda Indonesia 21
17 March 2007 Samara, Russia Tupolev Tu-134 UTAir 6
23 March 2007 near Mogadishu, Somalia Ilyushin Il-76TD
Trans Avia Export
Cargo Airlines
11
30 March 2007 Gasmata, Papua-New Guinea
Embraer EMB-110
Bandeirante
Airlink (PNG) 2
05 May 2007 near Douala, Cameroon Boeing 737-800 Kenya Airways 114
06 May 2007 50sm SE of Nakhl, Egypt
de Havilland DHC-
6 Twin Otter
French Air Force 9
17 May 2007
near Kilambo, The Democratic
Republic Of The Congo
Let L-410 Turbolet Safe Air Company 3
24 May 2007 near Pampa Hermosa, Peru
de Havilland DHC-
6 Twin Otter
Peruvian Air Force 13
21 June 2007
near Kamina, The Democratic
Republic Of The Congo
Let L-410 Turbolet Karibu Airways 1
23 June 2007 Al-Naeem, Yemen
de Havilland DHC-
6 Twin Otter
Yemenia 1
25 June 2007 near Sihanoukville, Cambodia Antonov An-24 PMT Airlines 22
28 June 2007 M'Banza Congo, Angola Boeing 737-200
TAAG - Angola
Airlines
5
29 June 2007 Bouake, Cote Ivoire Fokker 100
Government of Ivory
Coast
4
08 July 2007 Muncho Lake, Canada
de Havilland DHC-
6 Twin Otter
Liard Air 1
17 July 2007 Sao Paulo, Brazil Airbus A320-230 TAM Linhas Aereas 187
23 July 2007 Shinele Town, Ethiopia Antonov An-26 Djibouti Airlines 1
23 July 2007
near Eramo di Sant' Erasmo,
Italy
Canadair CL-415 SOREM 1
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23 July 2007 near Styra, Greece Canadair CL-415 Greek Air Force 2
29 July 2007 Moscow, Russia Antonov An-12 Atran 7
09 August 2007 Moorea, French Polynesia
de Havilland DHC-
6 Twin Otter
Air Moorea 20
22 August 2007
near Sao Jose dos Pinhais,
Brazil
Embraer EMB-110
Bandeirante
Two Taxi Aereo 2
26 August 2007
near Kongolo, The Democratic
Republic Of The Congo
Antonov An-32
Great Lakes Business
Co
10
07 September
2007
Goma, The Democratic
Republic Of The Congo
Antonov An-12 Galaxy Kavatsi 8
16 September
2007
Phuket, Thailand
McDonnell-
Douglas MD-82
One-Two-Go 90
20 September
2007
near McGrath, USA
Shorts SC.7
Skyvan
Arctic Circle Air
Service
1
24 September
2007
Malemba Nkulu, The
Democratic Republic Of The
Congo
Let L-410 Turbolet Karibu Airways 1
04 October 2007
Kinshasa, The Democratic
Republic Of The Congo
Antonov An-26 Malift Air 17
08 October 2007 near Cubarral, Colombia Let L-410 Turbolet
Nacional de Aviacion
Colombia
18
04 November
2007
Sao Paulo, Brazil Learjet 35 Reali Taxi Aereo Ltda 2
30 November
2007
near Isparta, Turkey
McDonnell-
Douglas MD-83
Atlasjet Airlines 57
26 December
2007
Almaty, Kazakhstan
Canadair
Challenger
Jet Connection
Businessflight
1
30 December
2007
near Sabang, Indonesia
A.S.T.A. (GAF)
Nomad
Indonesian Navy 5
Total 779
Damages and Hull Loss Statistics
Besides the tragic loss of human lives, air transport accidents are usually associated with high
material damages for airlines, insurance companies and third parties. In 2007, the total amount
of hull losses and liabilities amounted to US-$ 1.70bn according to the aircraft insurance analysts
Aon. This compares to US-$ 1.29bn for the preceding year. Overall, this safety record did result
in losses for the insurers, as insurance premiums amounted to only US-$ 1.5bn. The following
table provides a recount of the most expensive accidents in 2007 in terms of material damage.
The two materially most expensive accidents fortunately did not result in a single fatality.
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Table 10-2: Accidents with highest monetary aircraft damages in 2007
Source: Ascend Online Fleets
Accident
Date
Aircraft Type Operator Accident Location
Estimated
Damage
in million
US-$
15.11.2007 Airbus A340-600 Airbus Blagnac Airport,Toulouse,France 126.8
09.11.2007 Airbus A340-600 Iberia
Mariscal Sucre International Airport,
Quito, Ecuador
60.7
05.05.2007 Boeing 737-800 Kenya Airways (near) Douala,Cameroon 40.9
20.08.2007 Boeing 737-800 China Airlines Naha Airport, Okinawa, Japan 34.2
17.07.2007 Embraer 190
AeroRepublica
Colombia
Simon Bolivar Airport, Santa Marta,
Colombia
28.4
17.07.2007 Airbus A320
TAM Linhas
Aereas
Congonhas International Airport,
Sao Paulo, Brazil
23.9
26.10.2007 Airbus A320
Philippine
Airlines
Butuan Airport, Butuan City,
Philippines
22.4
12.08.2007 de Havilland Dash 8 Jeju Air
Kimhae International Airport, Pusan,
South Korea
19.2
13.02.2007
Canadair Challenger
800
Clear Sky
Holdings LLC
Vnukovo Airport, Moscow, Russia 19.0
19.04.2007 Airbus A300 Qatar Airways
Nadia International Airport, Abu
Dhabi, United Arab Emirates
15.5
10.4 List of Airlines Banned within the EU
Based on EU Regulation 2111/2005, which came into force in January 2006, the European
Commission, in close cooperation with the authorities responsible in the Member States, has the
right to ban operators from operating in EU airspace should common safety criteria be violated.
In 2007, this list was updated several times.
In March 2007, operational restrictions were imposed on Pakistan Airlines. In July, these
restrictions were modified, allowing operations into the Community with specific Boeing 747
and Airbus 310 aircraft in addition to its Boeing 777 fleet authorised before.
In July 2007, all Indonesian air carriers were banned from EU airspace, as the country could not
guarantee a safe regulatory environment. The impacts, however, were limited, as no Indonesian
carrier flew on a regular basis with scheduled flights to the EU.
In addition to restrictions and bans imposed by the EU, bilateral consultations resulted in
preventive safety measures being adopted unilaterally by some national civil aviation authorities,
in particular:
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- The Russian Federation decided to prohibit all operations to the EU by four local passenger
airlines (Kuban Airlines, Yakutia Airlines, Airlines 400, Kavminvodyavia) and imposed restrictions
on the operations of six other operators (Gazpromavia, UTAir, KrasAir, Atlant Soyuz, Ural
Airlines and Rossiya) limiting the number of aircraft used for such flights.
- Bulgaria decided to extend the measures imposed on local cargo carriers by revoking the
certificates of Air Sofia, Bright Aviation Services, Scorpion Air and Vega Airlines, suspending Air
Scorpio and prohibiting operations of Heli Air Services in EU Member States as well as in Iceland,
Norway and Switzerland.
- The Republic of Moldova withdrew the certificates of eight carriers (Valan, Pecotox, Jetline
International, Jetstream, Aeroportul Marilescu, Aeronord, Grixona and Tiramavia) which were
not subject to an appropriate safety oversight.
At the end of 2007, the list of airlines banned within the EU contains 147 carriers that have
been banned from operations into EU airports. In addition to the listed carriers, a general ban
for all carriers certified by the authorities of the Democratic Republic of Congo, Equatorial
Guinea, Indonesia, the Kyrgyz Republic, Liberia, Sierra Leone and Swaziland exists. On three
operators, operating restrictions have been imposed, which means that the entire fleet with the
exception of certain aircraft was banned from operating in EU airspace.
10.5 EU-OPS (EU Operations)
At the end of 2006, Regulation (EC) 1899/2006
74
amended existing regulations to harmonise
technical requirements and administrative procedures in the field of civil aviation and entered
into force on 16 January 2007.
Transferring most parts of Joint Aviation Requirements Operation (JAR-OPS) applicable to
commercial transportation by aircraft, these EU Operations (EU-OPS) are added to Regulation
(EC) 3922/1991 as a new Annex III. Because of dynamic changes and developments in this
technical area, an early adoption of new rules is possible by the assistance of the Committee
within comitology procedure.
Due to Article 2 (2) of Regulation (EC) 1899/2006, Annex III shall apply with the effect from 16
July 2008.
10.6 The European Community SAFA Programme
Following its transfer from ECAC/JAA to EC competence on 01 January, 2007 was the first full
year whereby responsibility for the management and further development of the EC SAFA
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(Safety Assessment of Foreign Aircraft) programme was assumed by the European
Commission assisted by the European Aviation Safety Agency (EASA) whose role focuses
upon the operational management of the Programme on behalf of the same Commission in
accordance with Commission Regulation 768/2006 EC.
Whilst EU Member States are legally bound to conduct ramp inspections under the so-called
'SAFA Directive' (2004/36/EC), the continued participation of the non-EU ECAC Member States,
and thus the pan-European dimension of the programme, has been assured through the
signature of a Working Arrangement between each of these individual States and EASA.
Including the EU-27 therefore, the EC-SAFA programme boasts a total of 41 Participating
States by the end of 2007.
Following the seamless transfer of the Programme to EC competence, 2007 was an important
year since it also saw the Commission introduce two important legislative proposals designed to
improve and enhance the efficacy of the Programme. Both instruments are foreseen for
adoption in early 2008 and consist of:
- a Commission Directive amending Annex II to Directive 2004/36/EC regarding the
criteria for the conduct of ramp inspections on aircraft using Community airports;
and
- a Commission Regulation implementing Directive 2004/36/EC as regards the
prioritisation of ramp inspections on aircraft using Community airports
.
10.7 The European Aviation Safety Agency (EASA)
Air safety is concerned with the rules for the construction and use of aircraft as well as the
licensing of staff involved in the operation and maintenance of aircraft and equipment.
Therefore, a high and uniform level of safety can be best attained by common action on
Community level and by the adoption of common safety rules concerning products, persons and
organisations. At the same time a common safety regulatory framework was adopted, the
European Aviation Safety Agency (EASA) as an independent safety regulator was created by so-
called “basic regulation” Regulation (EC) No 1592/2002 of 15 July 2002 on common rules in
the field of civil aviation and establishing a European Aviation Safety Agency (EASA)
75
.
In November 2005, the Commission published a proposal for a Regulation amending Regulation
(EC) No 1592/2002
76
. Under the regulation establishing EASA, the agency had been given
certification and rulemaking responsibilities with respect to airworthiness while the new
proposal extends the responsibilities of EASA concerning the common safety rules to air
74
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32006R1899:EN:HTML
75
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:240:0001:0021:EN:PDF
76
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2005:0579:FIN:EN:PDF
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operations, pilot licensing and the safety of third country aircraft. It also aims to strengthen
inspections and penalties in the event of non-compliance with these rules and, in the light of
experience, to improve the operation of EASA.
During 2007, the proposal was discussed by the European institutions according to the
codecision procedure. While the Council agreed a common position in October 2007, the
European Parliament proposed amendments to this common position at its 2
nd
reading. On 19
December 2007, the Commission adopted an opinion
77
on the European Parliament’s
amendments.
Also in 2007, several Commission Regulations were adopted:
- Commission Regulation (EC) No 593/2007 on the fees and charges levied by the European
Aviation Safety Agency
78
,
- Commission Regulation (EC) No 334/2007
79
amending the Basic Regulation in relation to
ensure compliance with environmental protection requirements contained in Annex 16 to the
Chicago Convention,
- Concerning Airworthiness & Environmental Certification: Commission Regulation (EC) No
375/2007
80
and No 335/2007
81
amending Commission Regulation (EC) 1702/2003 laying down
implementing rules for the airworthiness and environmental certification of aircraft and relating
products, parts and appliances, as well as for the certification of design and production
organisations and
- Concerning Continuing Airworthiness: Commission Regulation (EC) No 376/2007
82
amending
Commission Regulation (EC) No 2042/2003 on the continuing airworthiness of aircraft and
aeronautical products, parts and appliances, and on the approval of organisations and personnel
involved in these tasks
The Agency prepares drafts of opinions in order to assist the European Commission in its
preparation of proposals for basic principles, applicability and essential requirements. The
Agency also prepares Guidance Material relating to the application of implementing rules set
out in Article 13 of the Basic Regulation. In 2007 and in accordance with the Agency´s
Rulemaking procedure, five opinions have been submitted to the European Commission
83
.
77
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0864:FIN:EN:PDF
78
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2007:140:0003:0020:EN:PDF
79
http://eur-lex.europa.eu/LexUriServ/site/en/oj/2007/l_088/l_08820070329en00390039.pdf
80
http://eur-lex.europa.eu/LexUriServ/site/en/oj/2007/l_094/l_09420070404en00030017.pdf
81
http://eur-lex.europa.eu/LexUriServ/site/en/oj/2007/l_088/l_08820070329en00400042.pdf
82
http://eur-lex.europa.eu/LexUriServ/site/en/oj/2007/l_094/l_09420070404en00180019.pdf
83
http://www.easa.eu.int/home/rg_opinions_main.html
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All the other Agency measures
84
according to Article 13 of the basic regulation and notices of
proposed amendments (NPAs) especially concerning the extension of the EASA system to the
regulation of Air Traffic Management and Air Navigation Services (ATM/ANS)
85
are collected on
the EASA website
86
.
84
http://www.easa.eu.int/home/rg_agency_measures.html
85
http://easa.europa.eu/ws_prod/r/doc/NPA/NPA%202007-16.pdf
86
http://www.easa.europa.eu/home/r_npa.html and http://www.easa.europa.eu/home/r_archives.html
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11 Annex
11.1 Abbreviations
€ Euro
abbr abbreviation
ACARE Advisory Council for Aeronautics Research in Europe
AEA
Association of European Airlines
ASK
available seat kilometre
ATFCM Air Traffic Flow and Capacity Management
ATFM
Air Traffic Flow Management
ATFQ Automatic Ticket Fare Quote
ATM Air Traffic Management
AUC
Airport Users Council
AVSEC-QCC Aviation Security - Quality Control Centre
BAA British Airport Authority
ca. circa
CAEP Committee on Aviation Environmental Protection (of the Æ ICAO)
CFMU Central Flow Management Unit
CIS Commonwealth of Independent States
CO
2
Carbon Dioxide
DHS U.S. Department of Homeland Security
DLR Deutsches Zentrum für Luft- und Raumfahrt (German Aerospace Center)
EASA European Aviation Safety Agency
e.g.
exempli gratia
EC European Community
ECC-Net European Consumer Centre Network
EEA
European Economic Area
ePass electronic Passport
ERA European Regions Airline Association
etc.
et cetera
EU European Union
EU-ETS EU Emissions Trading Scheme
EUR Euro
FAA Federal Aviation Authority (of the USA)
FSNC
Full Service Network Carrier
FTK freight ton kilometre
GBP Pound sterling
i.e. id est
IATA International Air Transportation Association
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ICAO
International Civil Aviation Organisation
IEDO Intra-European and Domestic (Flights)
IFR Instrument Flight Rules
IMF International Monetary Fund
JPY Japanese yen
Kb Kilo Byte
LCC Low Cost Carrier
No
Number
NO
x
Nitrogen Oxide
Pax Passenger
PRC People's Republic of China
PNR
Passenger Name Record
RPK revenue passenger kilometre
SDR
Special Drawing Rights
TFCs taxes, fees and charges
TFTK Taken Freight Tonne Kilometres
UK
United Kingdom
UNFCC United Nations Framework Convention on Climate Change
USA United States of America
USD United States dollar
VAT value added tax
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11.2 Geographical Coverage Information
European Union
European Economic
Area
EUROCONTROL
Statistical Reference Area
International
Civil Aviation
Organization
(
Euro
p
e
)
EU 25 EU 27
EU Candidate
Countries
EEA ESRA ICAO Europe
composition valid from 2004 2007 actual 1994 2002
Albania x
Algeria x
Andorra x
Armenia x
Austria x x x x x
Azerbaijan x
Belarus x
Belgium x x x x x
Bosnia and Herzegovina x
Bulgaria x x x x
Croatia x x x
Cyprus x x x x
Czech Republic x x x x x
Denmark x x x x x
Estonia x x x x
Finland x x x x x
France x x x x x
Georgia x
Germany x x x x x
Greece x x x x x
Hungary x x x x x
Iceland x x
Ireland x x x x x
Italy x x x x x
Kazakhstan x
Kyrgyzstan x
Liechtenstein x
Latvia x x x x
Lithuania x x x x
Luxembourg x x x x x
Malta x x x x x
Moldova xx
Monaco x
Montenegro x
Morocco x
Netherlands x x x x x
Norway x x x
Poland x x x x
Portugal x x x x x
FYR Macedonia x x x
Romania x x x x
Russian Federation x
San Marino x
Serbia x
Slovakia x x x x x
Slovenia x x x x x
Spain x x x x x
Sweden x x x x x
Switzerland xx
Tajikistan x
Tunisia x
Turkey x x x
Turkmenistan x
Ukraine x
United Kingdom x x x x x
Uzbekistan x
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11.3 List of figures
Figure 1-1: Development of the global passenger volume ........................................................16
Figure 1-2: Development of the global passenger kilometres....................................................17
Figure 1-3: The main passenger flows between world regions (2007).......................................18
Figure 1-4: Development of the global freight traffic volume ...................................................19
Figure 1-5: Development of the global freight tonne-kilometres...............................................20
Figure 1-6: The main freight traffic flows between world regions (2007)..................................21
Figure 1-7: Development of Passenger Traffic in the EU-27 ......................................................22
Figure 1-8: Share of world regions in extra-EU-27 traffic ..........................................................24
Figure 1-9: Freight and Mail carried in the EU in 2006 and 2007..............................................25
Figure 1-10: Passenger Traffic of the former EU-15 Member States.......................................... 28
Figure 1-11: Passenger Traffic of the 12 new EU Member States..............................................29
Figure 1-12: Freight Traffic of the former EU-15 Member States ..............................................30
Figure 1-13: Freight Traffic of the 12 new EU Member States ..................................................30
Figure 1-14: IFR Flights in EU Member States in 2007...............................................................32
Figure 1-15: General aviation and business aviation .................................................................34
Figure 1-16: Worldwide fleet distribution in 2002 ....................................................................35
Figure 1-17: Business jets per country ......................................................................................36
Figure 1-18: The biggest manufacturers of business jets in terms of the number of aircrafts
sold......................................................................................................................
37
Figure 1-19: Distribution of traffic............................................................................................38
Figure 2-1: Global departures of commercial aircraft in the world in the third week of July
2007....................................................................................................................
41
Figure 2-2: Worldwide departures in the third week of July 2007.............................................41
Figure 2-3: Main air routes in Europe in terms of flight frequency ............................................42
Figure 2-4: Main air routes in Europe in terms of seats offered................................................43
Figure 2-5: Number of destinations per country .......................................................................44
Figure 2-6: Distribution of European air transport by carrier type..............................................45
Figure 2-7: Top 25 FSNCs in Europe in terms of flights per week.............................................. 46
Figure 2-8: Top 25 FSNCs in Europe in terms of seats per week ...............................................47
Figure 2-9: Top 25 LCCs in Europe in terms of flights per week ...............................................48
Figure 2-10: Top 25 LCCs in Europe in terms of seats per week ...............................................48
Figure 2-11: Top 25 Regionals in Europe in terms of flights per week.......................................49
Figure 2-12: Top 25 Regionals in Europe in terms of seats per week ........................................50
Figure 2-13: Top 25 charter airlines in Europe in terms of flights per week...............................51
Figure 2-14: Top 25 charter airlines in Europe in terms of seats per week.................................51
Figure 2-15: Number of passengers carried by the top 50 FSNCs in 2007,................................54
Figure 2-16: RPK and ASK for the top 50 FSNCs in 2007..........................................................55
Figure 2-17: Average load factor of the top 50 FSNCs in 2007................................................. 56
Figure 2-18: Number of passengers carried by the top 25 LCCs in 2007...................................58
Figure 2-19: RPK and ASK for the top 25 LCCs in 2007 ...........................................................58
Figure 2-20: Average seat load factor for the top 25 LCCs in 2007 ..........................................59
Figure 2-21: Number of passengers carried by the top 25 Regional Carriers .............................60
Figure 2-22: RPK and ASK for the top 25 Regional Carriers ......................................................61
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Figure 2-23: Average seat load factor for the top 25 Regional Carriers.....................................
62
Figure 2-24: Number of passengers carried by the top 25 Holiday/Charter Carriers...................63
Figure 2-25: RPK and ASK for the top 10 Holiday/Charter Carriers ........................................... 64
Figure 2-26: Average seat load factor for the top 25 Holiday/Charter Carriers .......................... 64
Figure 2-27: 10-year development of the world passenger aircraft fleet ...................................66
Figure 2-28: Price of jet fuel at Rotterdam in US-cents from 1997 to 2007...............................71
Figure 2-29: Price of jet fuel at Rotterdam in US-cents from January to December 2007...........72
Figure 2-30: Operating Expenses of the Air France-KLM Group for the fiscal year ended
31
st
March 2007 ..................................................................................................73
Figure 2-31: Share price development of major European network carriers in 2007..................74
Figure 2-32: Ryanair’s Operating Expenses Structure for the Fiscal Year ended 31
st
March
2007....................................................................................................................
75
Figure 2-33: Share price development of major European low cost carriers in 2007..................76
Figure 2-34: Airline alliances 2007 ...........................................................................................78
Figure 2-35: Number of weekly seats available of Star Alliance airlines in 2007 ........................80
Figure 2-36: Number of weekly seats available of SkyTeam alliance airlines in 2007 .................80
Figure 2-37: Number of weekly seats available of oneworld alliance airlines in 2007 ................81
Figure 2-38: Number of weekly seats available of non-alliance FSNCs in 2007..........................82
Figure 2-39: Airline alliances at major European airports ..........................................................83
Figure 2-40: Market share of airline alliances at major European airports in detail ....................84
Figure 2-41: Share of flights offered, including code share flights and actually operated in
2007....................................................................................................................
85
Figure 2-42: Ranking of airlines according to the number of code sharing partners in
Europe.................................................................................................................
85
Figure 2-43: Top routes in Europe in terms of the number of carriers operating ....................... 86
Figure 2-44: Number of routes with one or more carriers in 2007 ............................................86
Figure 2-45: Market entry / market exit in 2007 .......................................................................87
Figure 2-46: Market entry and market exit of low-cost carrier routes in 2007...........................88
Figure 2-47: Appraisal of ticket fares per kilometre according to stage distance (Economy
class)....................................................................................................................
92
Figure 2-48: Appraisal of ticket fares per kilometre according to stage distance (Premium
class)....................................................................................................................
92
Figure 2-49: Growth rates of the global economy, world trade and air freight (FTK) .................96
Figure 2-50: World airline traffic 2007: air freight capacity (in thousand tonnes for one
week in July) ........................................................................................................
99
Figure 2-51: World airline cargo traffic: air cargo freighter capacity (one week in July
2007).................................................................................................................
100
Figure 2-52: European airline cargo traffic: air cargo freighter capacity (one week in July
2007).................................................................................................................
100
Figure 2-53: Freight out of European CASS member states to various regions, 2006 vs.
2007..................................................................................................................
102
Figure 2-54: Percentage change in freight originating in Europe (CASS), 2006 vs. 2007 .........103
Figure 2-55: Percentage distribution of freight out of Europe in 2007 .................................... 103
Figure 2-56: Air freight traffic originating in Europe carried by CASS members by region;
2006 vs. 2007....................................................................................................
104
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Page 220 Release: 2.2
Figure 2-57: Growth of air freight traffic originating in Europe carried by CASS members
by region; 2006 vs. 2007 ...................................................................................
104
Figure 2-58: Available freight capacity in tonnes (belly & freighters) WOW members –
worldwide (one week in July 2007) ....................................................................
109
Figure 2-59: Available freight capacity in tonnes (freighters only) WOW members –
worldwide (one week in July 2007) ....................................................................
110
Figure 2-60: Available freight capacity in tonnes (belly & freighters) SkyTeam Cargo
members – worldwide (one week in July 2007) ..................................................
111
Figure 2-61: Available freight capacity in tonnes (freighters only) SkyTeam Cargo members
– worldwide (one week in July 2007) .................................................................
111
Figure 2-62: Available freight capacity in tonnes (belly & freighters) WOW vs. SkyTeam
Cargo – worldwide (one week in July 2007) .......................................................
112
Figure 2-63: Turnover per FTK for various airlines................................................................... 113
Figure 3-1: The 20 biggest airports in terms of commercial air passengers worldwide.............115
Figure 3-2: The 20 biggest airports in terms of air passengers in Europe.................................116
Figure 3-3: The 20 biggest airports in terms of flight movements worldwide..........................117
Figure 3-4: The 20 biggest airports in terms of flight movements in Europe ...........................118
Figure 3-5: Top 25 Low-cost carrier airports in Europe ...........................................................120
Figure 3-6: The 20 biggest airports in terms of commercial air freight worldwide ...................121
Figure 3-7: The 20 biggest European airports in terms of commercial air freight.....................122
Figure 4-1: Comparison of the passenger kilometres development of different global
forecast studies..................................................................................................
127
Figure 4-2: Airbus Forecast of Passenger Traffic within and between several World Regions...128
Figure 4-3: Eurocontrol Flight-Forecast Growth Rates for 2008 ..............................................129
Figure 4-4: Eurocontrol Medium-Term Forecast Baseline Scenario ..........................................130
Figure 5-1: European Community Aviation Agreements .........................................................139
Figure 7-1: Three out of four flights arrived on time in 2007 ..................................................162
Figure 7-2: Punctuality: US vs. Europe ....................................................................................163
Figure 7-3: Quarterly punctuality performances (AEA and FAA numbers) ...............................164
Figure 7-4: Quarterly departure vs. arrival punctuality of the AEA-Airlines (IEDO flights) .........164
Figure 7-5: AEA arrival punctuality performances of short/medium haul vs. long haul
services ..............................................................................................................
165
Figure 7-6: Proportion of delayed flights (IEDO) and average delay per delayed flight at
selected airports in 2007 ....................................................................................
166
Figure 7-7: AEA-Airline punctuality performances (IEDO) in 2007...........................................167
Figure 7-8: Number of daily regulated and delayed flights per month in 2007........................168
Figure 7-9: Most affected traffic flows Summer 2007 ............................................................169
Figure 7-10: Delayed baggage history ....................................................................................170
Figure 7-11: Flight regularity, AEA quarterly 2006-2007.........................................................171
Figure 7-12: Flight regularity, AEA short/medium haul services vs. FAA ..................................171
Figure 7-13: Various reasons for complaints in 2006 ..............................................................178
Figure 7-14: Range of seat pitches used by European airlines .................................................180
Figure 9-1: Number of Employees (EU 15) – Air Transport, national Economy.........................202
Figure 10-1: Global Passenger and Crew Fatalities in Air Transport Accidents 1997-2007.......206
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Annual Report 2007
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Release: 2.2 Page 221
Figure 10-2: Long-term trend of fatal accidents and passengers killed in commercial
aviation..............................................................................................................
207
Figure 10-3: Geographical Distribution of Air Transport Accident Fatalities in 2007 (IATA
Regions).............................................................................................................
207
11.4 List of tables
Table 1-1: Growth rates of selected indicators .........................................................................21
Table 1-2: Main Passenger Traffic Flows between EU Member States in 2007 ..........................23
Table 1-3: The main passenger flows of the EU-27 from/to selected world regions in 2007......23
Table 1-4: Important Freight Traffic Flows between EU Member States in 2007........................26
Table 1-5: Important Air Freight Traffic Flows between the EU-27 and other countries and
regions of the world in 2007................................................................................
27
Table 1-6: Classification of business jets...................................................................................34
Table 1-7: Worldwide fleet development until 2022.................................................................36
Table 1-8: Ownership structure of business jets........................................................................37
Table 1-9: Airports with the most business aviation departures ................................................39
Table 1-10: Airport with the highest proportion of business aviation departures.......................40
Table 2-1: The top 50 Full Service Network Carriers worldwide ................................................53
Table 2-2: The top 25 Low Cost Carriers worldwide.................................................................57
Table 2-3: The top 25 Regional Carriers worldwide ..................................................................60
Table 2-4: The top 10 Charter Airlines worldwide ....................................................................62
Table 2-5: Passenger aircraft in service at year-end...................................................................65
Table 2-6: Average age of passenger aircraft in service at year-end ..........................................66
Table 2-7: The 20 largest network carriers by fleet size at year-end 2007, mainline
passenger operations only....................................................................................
67
Table 2-8: The 20 largest low cost airlines by fleet size at year-end 2007 .................................68
Table 2-9: The 20 largest regional airlines by fleet size at year-end 2007..................................69
Table 2-10: The 10 largest holiday airlines by fleet size at year-end 2007 .................................70
Table 2-11: Revenues and Operating Results of selected European Network Carriers for
the fiscal years 2006 and 2007.............................................................................
72
Table 2-12: Operating Margins of selected European Network Carriers ....................................73
Table 2-13: 2007 International Scheduled Traffic by Alliance....................................................79
Table 2-14: Market entries of carriers in EU-27 during 2007 ....................................................89
Table 2-15: Market exits of carriers in EU-27 during 2007........................................................90
Table 2-16: PSO routes per country 2007.................................................................................90
Table 2-17: Revenue freight tonne kilometres in 2007 .............................................................97
Table 2-18: Scheduled cargo services of AEA member airlines in 2007 ...................................101
Table 2-19: AEA members' air freight traffic, 2006 vs. 2007 ..................................................105
Table 2-20: The 20 largest cargo airlines by fleet payload capacity at year-end 2007..............106
Table 2-21: Cargo aircraft in service at year-end 2007 ...........................................................106
Table 2-22: Average age in years of cargo aircraft at year-end 2007 ......................................107
Table 3-1: List of contracts awarded to Ground Handling Companies in 2007........................124
Table 4-1: Comparison of important variables of different global forecast studies ..................126
Table 4-2: Summary of the Eurocontrol Medium-Term Forecast .............................................130
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Table 4-3: Summary of the Eurocontrol Long-Term Forecast 2005-2025 ................................
131
Table 6-1: Applied Noise and Emissions Regulations at Airports 2007; World and Europe ......160
Table 6-2: Applied Noise and Emissions Regulations at European Airports 2007 (Sample
144 airports from 12 countries)..........................................................................
161
Table 7-1: National Enforcement Bodies regarding Regulation (EC) 261/2004 on passenger
rights .................................................................................................................
175
Table 7-2: Complaints registered by ECC-Net per country ......................................................179
Table 7-3: Seat pitches used by European airlines...................................................................181
Table 8-1: Cargo and Passenger Gross Aircraft Orders by Manufacturer 2007........................185
Table 8-2: Gross orders of Airbus aircraft, breakdown by type ...............................................186
Table 8-3: Gross orders of Boeing aircraft, breakdown by type...............................................186
Table 8-4: Order backlog (commercial customers) at 31st December 2007 for passenger
and cargo aircraft...............................................................................................
188
Table 8-5: Major new Aircraft Orders by Airlines from EU-27 .................................................189
Table 8-6: Orders for Business Jets 2006/2007 .......................................................................190
Table 8-7: Passenger and Cargo Aircraft Deliveries to Commercial Operators by
Manufacturer 2006/2007...................................................................................
191
Table 8-8: Values of Passenger and Cargo Aircraft Deliveries by Manufacturer at Average
List Prices 2006/2007 in million US-Dollars .........................................................
192
Table 8-9: Deliveries of Airbus aircraft to Commercial Operators, breakdown by type.............193
Table 8-10: Deliveries of Boeing aircraft to Commercial Operators, breakdown by type..........193
Table 8-11: Conversions of Passenger Aircraft into Freighters 2007........................................195
Table 8-12: General Aviation Aircraft Manufacturers..............................................................196
Table 8-13: Engine and Market Share Breakdown on Aircraft Ordered in 2007 (without
spare engines)....................................................................................................
198
Table 8-14: Engine and Market Share Breakdown on Aircraft Delivered in 2007 (without
spare engines)....................................................................................................
199
Table 9-1: Number of Employees (1.000) – Air Transport .......................................................201
Table 9-2: Number of Employees (1.000) – National Economy................................................202
Table 9-3: Number of Employees (1.000) – German Air Transport ..........................................204
Table 10-1: Air Transport accidents with fatalities in 2007 .....................................................208
Table 10-2: Accidents with highest monetary aircraft damages in 2007 .................................210
