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Airline consolidation and its impact on passengers...

16.10.2017

PRESS RELEASE

Airline consolidation limits competition and reduces consumer choice, study confirms
BRUSSELS, 11 October 2017

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An independent research report released today shows that airline consolidation decreases consumer choice. The report finds that airline mergers, acquisitions, joint ventures and code-share agreements, have over time contributed to a reduction in competition, fewer choices and higher prices for consumers.
The study was conducted by aviation economists GRA and was supported by the European Federation of Travel Agents’ and Tour Operators’ Associations (ECTAA), the European Passengers Federation (EPF), the European Technology & Travel Services Association (ETTSA) and air passenger rights watchdog Friendly Flying.
As airlines and airline groups are becoming more powerful, they are increasingly driving consumers to their own websites where they avoid head-on competition and comparison shopping. The study finds that many airlines do this by making less information available to travel agents and/or financially penalizing consumers who prefer to buy from those independent and neutral distributors.
“Particularly now that the airlines have consolidated, the most effective way of ensuring consumers have a fair chance of finding the best air travel option available is through neutral comparison shopping which depends on independent distribution,” finds the GRA report.
“The findings of this report expose a harmful double effect of airline consolidation,” says Christoph Klenner, Secretary General of ETTSA. “Consolidation on its own reduces the number of competing airlines, but what is more, the larger airlines and airline groups become more powerful. This power allows them to hold consumers captive to their biased websites in order to reduce transparency and deprive them of the ability to compare competing options.”
Michel de Blust, Secretary General of ECTAA, remarks: “Neutral, independent travel distribution plays a critical role in providing transparency and real choice for consumers and travel buyers. As the study shows, if powerful airline groups are allowed to engage in discrimination of the neutral distribution channels, consumers will pay the price in the form of less choice and higher fares.”
“The study shows clearly the need to reassess the effects of consolidation on
airline competition and the European consumer. An attack on transparency is
an attack on twenty five years of a successful EU air transport policy. Europe
has the legal instruments and the regulatory framework to prevent further
detrimental impact on the consumer from airline consolidation. Obtaining
tickets for the best price is the main interest of passengers of any mode of
transport,” adds Josef Schneider, Chairman of the European Passengers’
Federation (EPF).
ENDS
For more information
Michel de Blust, ECTAA, +32 2 644 34 50, mdeblust@ectaa.eu
Stijn Lewyllie, EPF, +32 476 85 65 00, stijn.lewyllie@epf.eu
Christoph Klenner, ETTSA, +32 478 410 064, cklenner@ettsa.eu
About ECTAA
ECTAA is the European Federation of Travel Agents’ and Tour Operators’
Associations. Its members are national travel agents’ associations from over
30 European countries.
About EPF
The European Passengers’ Federation (EPF) is the voice of all European
transport consumers. EPF has over 30 member organisations across Europe.
Friendly Flying is a member of EPF, and a dedicated watchdog of air
passenger rights and airline consumer matters.
About ETTSA
The European Technology & Travel Services Association is the voice of the
travel technology industry in Europe. ETTSA’s members are all the principal
independent providers of travel information and distribution services.
Key findings from the report “Impact of Airline Consolidation on
Consumer Choice” (GRA)
• Further airline consolidation risks jeopardising competition in key
European markets.
• Independent distribution is necessary for consumers to compare
travel options through neutral and transparent comparison shopping.
• Carriers are employing anti-consumer strategies to drive consumers to
their own websites to avoid the competition they face on independent
channels.
• Airlines are hindering effective comparison shopping by denying
independent channels access to content and by imposing
discriminatory surcharges on consumers who purchase tickets from
independent distributors.
• De-emphasising comparison shopping harms new entrants, and
ultimately further undermines consumer choice.
Q&A GRA report
What effect has the liberalisation and deregulation of airline markets
had?
While liberalisation and deregulation have allowed new market entry,
government authorities have permitted airlines to consolidate at the expense
of competition.
What are some of the characteristics of airline consolidation?
Consolidation in the airline industry can take the form of mergers and
acquisitions, joint ventures, code share arrangements and transatlantic megaairline
alliances immunized from the consumer safeguards otherwise found in
US antitrust law. Each of these reduce competition.
Why should consumers be concerned?
A reduction of competition as a result of airline consolidation has led to
consumers having less choice and fewer travel options. Airlines have gained
the power to increase fares in markets where competition has been reduced.
How does airline consolidation affect price transparency for
consumers?
As airlines and airline groups are becoming more powerful, they are
increasingly driving consumers to their own highly-biased websites where
they avoid head-on competition and comparison shopping. Airlines are doing
this inter alia by making less information available to travel agents and online
platforms so as to deliberately make their offer less attractive, and by
introducing discriminatory surcharges penalising consumers who want to
compare offers.
What should European regulators do?
Regulators in the EU should carefully assess the effects airline consolidation
has had on competition, and determine whether the doctrine used to analyse
proposed consolidation is fit for purpose. Also, regulators should prevent
airlines from discriminating against consumers who want to compare offers
and have price transparency.
What instrument do regulators have to address these issues?
This should be done by diligently enforcing and possibly strengthening
existing rules that ensure fair competition and protect consumers such as
(Regulation (EC) No 80/2009 on a Code of Conduct for CRS, and Regulation
(EC) No 1008/2008 on common rules for the operation of air service.

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Friendly Flying in European Parliament

12.05.2017

mla parlament

Friendly Flying, as a member of European Passenger Federation (EPF), took part in an European Parliament Hearing. The meeting was held on the 4th of May in Brussels and organized by the European Technology & Travel Services Association (ETTSA). Three Members of Parliament were listening to consumer and travel operator experts. Approximately 50 guests in the audience had a chance to listen to the panelists discuss problems like airline passengers’ rights, transparency in airline business, consolidation, mergers and their implications, as well as news from the field – what do the consumers/passengers need, what problems do they have, how should we help them and how to facilitate the enforcement of the existing and new-coming regulations.

The parliament members seemed very much interested in the presented opinions and recommendations. Friendly Flying will be present in Brussels until the end of this year in order to talk and  bring changes to the enforcement of passengers’ rights, push the execution of airlines’ duties to inform passengers on their rights, influence the strategy decisions and make air travel business more friendly to all consumers and passengers.

 

Keep your fingers crossed ! :)

 

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Passenger Friendly Airline for 2015

18.03.2016

As a result of our monitoring of air travel services and handling out-of-court resolution, we have decided to introduce for the first time in 2015 the title of “Passenger Friendly Airline”. We have examined the way the airlines manage the relations with their passengers in case of complaints are received and especially to make sure whether the process is run in dialogue with passengers. The goal of such title is to enhance quality standards and good practices within customer relations, and support introduction of new model for Alternative Dispute Resolution in the European Union, including aviation sector. We are pleased to announce the title in 2015 goes to Ryanair!

Friendly Airline 2015

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Blue Card for our Members!

17.09.2015

Finally we have our Membership Cards waiting for the people who are ready to support us and then benefit from becoming one of us.

 

credit

The membership fee is only 20 EUR and then You get a plastic Membership Card and a luggage sticker.

You are also helping us make changes in the air travel sector and allow to continue our direct help to the passengers.

 

Thank You!

 

 

 

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