September 16, 2008
When Lufthansa buys Brussels Airlines consumers will likely pay a higher price.Yesterday Lufthansa announced that it will take a 45% stake in Brussels Airlines. It seems just the first step in the complete takeover of Brussels Airlines as Lufthansa has an option to buy the Belgian airlines for a maximum price of 250 mio EUR in 2011.
Why does this matter for Brussels based ex-patriates: While Brussels Airlines has adopted a low-fare pricing scheme Lufthansa’s flights still have a higher price tag. When comparing flights from Brussels to Berlin then Lufthansa is often the more expensive choice. When there is no more real competition on such connections then prices are likely to even more up.
For me, an Austrian living in Brussels there could be further consequences of this airlines consolidation process: Because Lufthansa could not only take over Brussels Airlines but also Austrian Airlines this would mean also nearly no more competiton on the route Brussels-Vienna. Currently there is still the low-fare airlines SkyEurope which is serving this route but they are also in financial troubles and it is unsure whether they still exist for a long time.
Does the liberalisation of airlines markets in Europe mean therefore only lower prices in the short term, until consolidation increases the prices again? I hope not.
But in the end I hope that rail transport in Europe (at least for connections like Brussels-Berlin or Brussels-Vienna) will become more competitive.Author : brusselsblogger