European Airline Costs Soar, Study Warns
A new study commissioned by Airlines for Europe (A4E) has revealed a dramatic increase in the cost of doing business in Europe, with costs having tripled since 2014 and projections indicating they could double by 2030. Speaking to delegates at Routes Europe 2025 in Seville, Spain, A4E Managing Director Ourania Georgoutsakou outlined the study’s findings, emphasizing that regulatory costs and systemic inefficiencies have added an astonishing €15.5 billion (approximately $17 billion) to European airline expenses in 2024 alone.
Georgoutsakou explained that the surge in operating costs is driven by a range of factors including the expense of complying with a complex web of regulations, environmental legislation, corporate disclosure obligations, operational compliance, border security measures, and various taxes. “I mean, the cost of complying with regulations, environmental legislation, corporate disclosure obligations, operational compliance obligations, border security, taxation and also the cost of inefficiencies,” she said during her address on April 8. She warned that if these trends persist, the cumulative cost could double to nearly €27.6 billion by 2030, posing a serious threat to the competitiveness of European airlines.
The research, conducted by consultancy firm Steer Davies & Gleave, determined that the direct cost of compliance was approximately €9.9 billion in 2024. However, when market inefficiencies are taken into account – particularly the lack of a fully operational Single European Sky that would streamline airspace management – total costs soar to €15.5 billion. On average, this translates into an extra cost of about €30 per passenger, a figure that highlights the growing burden on carriers and ultimately on consumers.
Georgoutsakou also pointed to additional policy measures that are expected to further exacerbate these costs. In particular, she mentioned the ReFuelEU 6% sustainable aviation fuel blending mandate set to take effect in 2030. While aimed at reducing the environmental impact of aviation, this requirement will likely push up operating costs even further, as airlines must invest in new fuel infrastructure and potentially higher fuel prices in the transition toward sustainable alternatives.
The study’s findings also reveal a concerning disparity between cost increases and traffic growth. European regulatory costs have been growing at an annual rate of 11% since 2014, far outpacing the 4% annual growth in passenger traffic. This imbalance, according to Georgoutsakou, is a stark warning for European airlines. As the cost structure becomes heavier, it could erode profitability and make Europe a less attractive market for investment and expansion.
The implications of this study extend beyond the airlines themselves, affecting the broader European economy and travel market. Higher operational costs are likely to be passed on to passengers through increased ticket prices, potentially dampening the post-pandemic recovery in travel demand. The study calls on policymakers and industry stakeholders to work collaboratively to address these inefficiencies, streamline regulatory requirements, and ultimately foster a more competitive environment that supports long-term growth in European aviation.
As European airlines continue to face mounting pressures from regulatory and market inefficiencies, the call for meaningful reform grows louder. For the industry to remain globally competitive, significant changes must be implemented to reduce the financial burden that currently weighs on carriers and to enable reinvestment in innovation and sustainability initiatives.
Related News : https://suspicious-zhukovsky.67-21-117-18.plesk.page/?s=European+Airline