In these challenging financial times, The German Aviation Authorities rang alarm bells in the European Aviation world last week by ordering the UAE carrier Emirates to raise their fares for the German market, whilst threatening fines starting at Euros 25,000 for non-compliance.
This seemingly badly timed move has occurred at a crucial moment, as frequent German travellers discover the potential to save in some cases thousands of Euros, by taking advantage of long-haul flights with indirect (plane change required) as opposed to direct (direct to destination) or non-stop carriers. Such savings are more even appealing when flying business class.
At Perpetual Traveller we find it incredible that the German Aviation policy appears to actually force a reputable international carrier to increase fares if it is seen to be less expensive than Lufthansa and its Star Alliance partners. We understand that a letter sent by the president of The Federal Office for Goods Transport, indicates to senior management at Emirates “While price leadership [on a route] is allowed for EU airlines this situation does not apply to airlines of non-EU countries.”
Apart from a few isolated or special exceptions, aviation on long distance routes is not de-regulated as it is within the EU, hence some governments retain the draconian right to enforce such rules if they feel a particular airline or airlines originating from another country have what is deemed to be an unfair advantage over their national carrier. Of course this protectionist attitude is simply wrong in the 21st Century and a dark step backwards.
Clearly Emirates feels that it is being unfairly targeted as no other warnings to other non-EU airlines to our knowledge have been issued. Emirates president Tim Clark spoke recently at London’s Aviation Club and referred to the matter in the following way “Let me state categorically that we price our tickets commercially, competitively and fairly in all markets we serve.” he went on… “This means as a consequence of the current German policy, Lufthansa’s fares ex-Frankfurt are being maintained at artificially high levels.” he also said… “They are often the highest in the market by a large margin, something which is clearly to the detriment of German travellers and the German economy,”
In reality the situation is somewhat confusing and yet to be solved. We will keep a close on developments at Perpetual Traveller, as such action could have negative ramifications across the world for Long haul flights.
Meanwhile, if you are planning business class trip to Asia or other Long Haul routes from Germany
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