EUROPEAN LOW-COST

ELFAA, the European Low Fare Airline Association, has commissioned a research to York Aviation, a consulting agency, which purports to prove that low-cost companies will overtake legacy airlines by 2020.

Considering all flights within Europe, the share of low-cost passenger will grow from the current 38% to 55% in 2020. 

but considering just point-to-point flights, and not feeder flights to a hub, a segment in which low-cost don't compete, their share will grow from 43% to 60%.

This study considered both the nine companies member of ELFAA and also seven others one. The trend of growth was considered conservatively, as many companies are now consolidating their business model.

In the period 2005 to 2010, the average growth was 14% per year, while in the same period, legacy companies increased their offer of seats by 0.6%.

In that same time, the share of ELFAA members grew from 16% to 28%. In regard to the actual number of passengers, thanks to the higher load factor of low-cost, this grew from 24% to 38%.

The predictions of this research are based on the Global Market 

outlook by Airbus, with limitations considering the current maturity of carries such as Ryanair and Easyjet. This is the basic scenario prediction, according to which ELFAA companies will increase their offer of seats by 72% in the coming ten years, the others low-cost by 68% and legacy airlines by just 27%.

In the scenario if higher growth, the ELFAA companies will increase their capacity by 108%, against 84% of the other low-cost and 10% of traditional companies, their share of the market would grow from 45 to 49%.

The same two scenarios, considering the actual number of passengers, predict, in the basic scenario, low-cost increasing their passengers share from 38% to 45% in 2020, in the higher scenario, from 38% to 53% and possibly forcing the data, this research affirms that in point-to-point flights low-cost companies will attain either 50% or 60% of the market.