Today’s Low Airfares to Europe? Thank Low Fuel Prices, Sir Freddie, and a Viking Named Bjørn

By Paul Riegler on 25 October 2016
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The fare wars are on and you can thank cheap fuel and a dramatic increase in competition for them. Channeling the ghost of Sir Freddie Laker who, in the 1970s pioneered jet age “no frills” international flights, numerous low-cost carriers, including Ryanair of Ireland, have brought affordable travel to the masses across the globe. Southwest Airlines, now the second largest airline in the world by number of passengers carried, has succeeded by sticking to one aircraft type and shorter routes.

In the United States, the cost per gallon for jet fuel has declined 28% in the first eight months of 2016 compared to the same period in 2015 and the average domestic fare dropped to $361, down 7.8% from $392 in the same period in 2015, according to the Department of Transportation’s Bureau of Transportation Statistics. This put fares at the lowest level since 2010, when adjusted for inflation.

Looking back at 2016, travel to Europe is down after a year of terror attacks in Paris, Munich, and Brussels as well as the Brexit vote, although the latter has attracted a number of bargain hunters heading to London’s high streets for low-cost deals.

A Wow Air jet in Keflavik

A Wow Air jet in Keflavik

In general, low fares to Europe have come from relatively new non-U.S. airlines, mostly European low-cost carriers such as Norwegian Air and Wow Air. Indeed, Norwegian has offered sale fares from New York to Scandinavia for as low as $139 one way. To say this has made the U.S. legacy carriers a bit hot under the collar would be an understatement. Indeed, several of them, along with major airline employee unions, have asked the U.S. Department of Transportation to withhold approval on Norwegian’s flights by its Irish and U.K. subsidiaries, which some claim are operating under flags of convenience and underpaying their employees, charges the airline vociferously denies.

Last week, faced with declining revenue on transatlantic routes, Delta Air Lines, the country’s second largest, switched strategies and began to fight fire with fire, saying it would consider offering extremely low-cost coach fares.

“I think what we know is that Delta has a very, very strong brand, and much stronger than some of the [low-cost carriers], said Ed Bastian, the airline’s CEO, adding that he believes “people would prefer to fly with us than they would on some of the unknown, non-brand names.”

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