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‘Low fares to account for a quarter of European business flights’
Low fares are likely to account for up to a quarter of all European business flights by the end of the year, Carlson Wagonlit Travel claims.
Research by the travel management company’s consulting arm CWT Solutions reveals that low fares offered by traditional airlines have made a major impact in Europe.
They now account for 12% of flights bought by European companies against just two per cent by low cost carriers – and they represent savings of about 35%. Low fares are worth an estimated Euro 500 million to European airlines.
CWT says discounted and special offer fares promoted by the major carriers can be between 15%-80% cheaper than fully flexible tariffs.
CWT Solutions air consulting director Herve Joseph-Antoine said: “Adoption of ‘low fares’ is set to increase more within Europe and they could possibly reach a 20-25% share of the business travel air market by the end of this year. ‘Low fares’ have already resulted in a four per cent reduction in corporate airline spend and we believe that figure could be at least doubled if companies take the right approach.”
CWT says business travellers prefer to use network carriers now fares have been reduced because they offer better frequency and more convenient airports. The study also shows that business travellers are prepared to accept less flexibility of fares in order to obtain a better rate.
Airline price competition is particularly fierce on key intra-European routes such as London-Edinburgh, Amsterdam-Geneva, Barcelona-Dusseldorf and Dusseldorf-Munich.
The CWT research covered more than 5.5 million business flights over a three-month period from December 2003 to February this year.
Report by Phil Davies
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