Budget airfares battle to intensify

29 April 2004

BERLIN – Budget airline Easyjet marked the launch of its new German service this week by predicting that airline ticket prices will sink further in the next years further.

Speaking in Berlin the chief of Europe’s second biggest no-frills carrier, Ray Webster said flying will be cheaper as a result of falling airport taxes and new technologies.

Webster wants to cut airport costs from their present level of about 32 percent of the total costs to 20 percent in the next two years.

His remarks follows similar predictions by Michael O?Leary, the chief of market leader Ryanair, who said that over-capacity was exerting downward pressure on prices.

Competition in the German budget airline business has been intensifying with seven smaller carriers begin service to Berlin alone this year.

Leading German budget airline, Air Berlin has already responded to the arrival of Easyjet was cutting prices on its Mallorca routes.

Air Berlin dramatic growth has turned into Germany’s second biggest carrier after Lufthansa.

Airline industry observers say that the launch of Easyjet’s German service could also help to pave the way for cheaper flying.

After starting its service from Berlin to London Luton this week, Easyjet wabts to add another 13 destinations to its German service in the next two months, including major holiday spots such as Palma de Mallorca and Barcelona.

Subject: German news