Lufthansa CEO Fears For The Future Of German Aviation
After both Ryanair and Eurowings announced large service cuts in Germany in 2025, Lufthansa CEO Carsten Spohr says he is concerned that high taxes and fees at German airports will continue to drive carriers away. He’s right.
Lufthansa CEO Worried About Competition Cutting Routes Due To Burdensome German Aviation Taxes And Regulations
Speaking to the Bild am Sonntag, Spohr expressed concern for the German aviation industry that appeared to go beyond simply his own portfolio of carriers in the Lufthansa Group:
“I am very concerned about the connectivity of our business locations. The extreme increase in state costs for air traffic is leading to a further decline in services. More and more airlines are avoiding German airports or canceling important connections.”
He pointed to both Eurowings, a low-cost Lufthansa subsidiary, and Irish budget carrier Ryanair as having canceled German routes over the “excessively” high airport fees.
Indeed, Ryanair announced last week that it would end service to Dresden, Dortmund, and Leipzig starting next summer and specifically blamed high taxes and fees. Ryanair is also reducing flights to Hamburg by 60% and Berlin by 20%. It blamed the routs cuts on the “German government’s continued failure to reduce air traffic tax, security and air traffic control charges, which are hindering recovery and growth.” It also took a swipe at Lufthansa:
“German citizens now face the highest airfares in Europe following Lufthansa’s €6 billion bailout. This performance by Germany stands in stark contrast to other EU countries such as Sweden, Italy, Hungary and Poland, which are reducing access costs to promote post-COVID recovery and growth in air traffic.”
Side note: Lufthansa repaid its bailout, unlike US carriers.
But Eurowings followed by announcing it too would suspend service to Hamburg on several routes.
“In addition to these domestic German cancellations, Eurowings will probably remove six other destinations in Europe and North Africa from its program from Hamburg.
“Flying to and from Germany is becoming increasingly expensive and unprofitable on many routes. This development could have been avoided, but the airport’s plans for a completely disproportionate increase in fees leave us no choice.”
Spohr also specifically condemned a national synthetic fuel mandate, which he labeled an impossible mandate when “a blending quota for e-fuels…are not yet available in sufficient quantities.”
The result is “the connectivity quality of many important economic regions is declining by international standards.”
Does Lufthasna CEO Have A Point?
I think Spohr is mostly correct and while the reduction of service by Ryanair ostensibly helps Lufthasana, the high airport fees and fuel mandates do squeeze margins for everyone, making flying from Germany on Lufthansa mainline and Eurowongs relatively less attractive.
While there’s something to be said for “nice things aren’t free” and that it takes committed infrastructure investment to create systems that function, German taxes are far higher than in neighbor countries. There’s a reasonable argument to be made that the fees are indeed excessive and discourage growth while also not advancing carbon neutrality and other reasonable goals.
The cutbacks from Ryanair and Eurowings also suggest that consumers do have a ceiling of tolerance for airfare and the idea that they will just take the train instead is not clear: instead, they will more likely just stay home.
CONCLUSION
I don’t think Ryanair and Eurowings are bluffing because I see the higher taxes myself when I fly via Germany…it’s one reason I fly out of France or Switzerland instead. Frankly, I think they are too much as well…like the bloated UK departure taxes. And that is the dilemma governments across Europe (and the Americas) face: finding that balance such that the aviation industry and the economic multiplier effect it brings are not crippled in the name of environmental progress or even infrastructure.
image: Kevin Hackert