Posted August 1, 200816 yr Airlines across Europe face their biggest crisis this winter as the high price of fuel threatens to bankrupt at least 50 carriers. Weaker carriers will not survive the postsummer holiday crunch, aviation analysts say, as passenger demand falls because of higher fares and the worsening economy. The gloomy outlook is shared by the heads of Britain’s largest airlines, British Airways and Ryanair. Willie Walsh, the chief executive of BA, said yesterday: “We will see a number of failures as there are quite a lot of weak carriers that will not survive. We are in the worst trading environment the industry has ever faced.” Airlines are responding to the crisis by reducing the number of flights in the quieter winter months. BA said that it would make a series of cuts to its schedule after a 90 per cent fall in profits in the past three months. Ryanair also plans to cut routes and ground aircraft over winter. BA and Ryanair are among the strongest airlines operating in Europe and analysts believe that weaker carriers will be forced into more drastic action, such as merging with a rival, or they will go out of business. Douglas McNeil, of Blue Oar investments, said that more than 50 European airlines were under threat. His list includes names such as SAS (Scandinavia), Alitalia (Italy), Olympic (Greece), Malev (Hungarian) and Lot (Poland). The future of smaller British airlines such as bmi, Flybe and Monarch was also doubtful, he said in a report, Into Thin Air. Mr Walsh said: “It’s a positive thing if some of these carriers go out of business, as it will take capacity out of the market. Look at Alitalia – it should not be allowed to continue in business. It is propped up by the illegal state aid from the Italians.” The threat of bankruptcies could make passengers hesitant over which airlines to trust when booking winter breaks or business trips, exacerbating the problems some carriers face. Most airlines are expected to increase fares to offset the rapidly rising price of fuel, which now costs BA £8 million a day. Source: The Times If lots of airlines go out of business, will this be bad for the travel industry?
August 2, 200816 yr If lots of airlines go out of business, will this be bad for the travel industry? Bad for consumers anyway. Fewer airlines, less competition, the public more at the mercy of the larger, successful airlines.
August 2, 200816 yr Are BMI and Flybe small airlines? Anyway 50 airlines are a lot. TBH they should raise ticket prices even if it pisses of people :P
August 3, 200816 yr Bad for consumers anyway. Fewer airlines, less competition, the public more at the mercy of the larger, successful airlines. Good for domestic holiday providers though! More and more people will be holidaying at home. Having said that, holidaying at home ain't that cheap either! Two years ago it cost us just short £800 to hire a boat on the Norfolk Broads for a week - and it wasn't a brand-spanking new thing - if you've watched The African Queen, with Humphrey Bogart, you'll get the picture. Norma
September 14, 200816 yr Author As thousands of British holidaymakers struggled to get home yesterday following the collapse of XL, Italy's Alitalia became the latest airline to fall victim to the rising price of oil How many more Airlines and Holiday Companies are going to go bust over the coming months? Looks like they are going down like ninepins at the moment.
September 14, 200816 yr Alitalia is a disaster. They can only repair planes in one city, they have an older, inefficient fleet and they can't decide whether to base operations in Rome or Milan (execs in both cities are fighting each other). And the worst part is, when Air France-KLM offered to buy them out (which would have saved them), they said it's an Italian company and should stay that way. They've buried their own grave. Also it's a DREADFUL airline to fly on. SAS is in trouble which is a shame because I really like them!
September 18, 200816 yr Bad for consumers anyway. Fewer airlines, less competition, the public more at the mercy of the larger, successful airlines. But it could also bring up the standards. The days of being treated like an animal may be over... :rolleyes:
September 18, 200816 yr Yes, at times like this the least efficient and worst managed companies are the ones to lose out which can only be a good thing.
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