British Airways and other European airlines have raised the stakes in their...
British Airways and other European airlines have raised the stakes in their battle with the low cost carriers. They have slashed fares as much as eighty percent, risking profits to regain market share, analysts have said.
Europe's major carriers lost more than a combined three billion dollars last year as the economy slowed and the September 11th attacks led to a drop in demand for air travel. The no-frills airlines however remained profitable, attracting new customers and luring passengers from rivals.
?Mainline carriers must get costs down if they're going to make money while cutting prices,? said Chris Tarry, an analyst at Commerzbank. ?This fight back increases the pressure on no- frills airlines.?
British Airways reduced a London-Genoa round trip to 99 pounds ($151) from 577 pounds, while Lufthansa dropped some fares by as much as sixty three percent, making Europe's two biggest airlines more competitive with the low cost rivals such as Ryanair Holdings, EasyJet and KLM?s Buzz.