Low Cost Monitor 1/2012

Low Cost Monitor 1/2012 - An Analysis performed by DLR - 454 Routes LCC Routes 2012 The current Low Cost Carrier Market in Germany Spring 2012

The current Low Cost Carrier Market in Germany 2011/2012 The Low Cost Carrier (LCC) market has been an inherent part of the German air transport market for several years. Published by DLR twice a year, the Low Cost Monitor informs on LCC s essential features and current developments in this market segment, particularly with reference to the number and relative importance of low-cost carriers, their supply including air fares, and the passenger demand for low-cost transport services. The offers reflected by the current Monitor are based on one reference week of the winter flight schedule 2012. The passenger figures refer to the whole year of 2011. Airlines The airlines involved in the Low Cost business design their offers quite differently. Due to this inhomogeneity only a few distinctive criteria can be defined for the Low Cost market segment, such as low fares, general availability and direct sale via the internet. Thus, in some cases, a certain scope of discretion arises when allocating an airline to a LCC segment. Furthermore, amalgamations of business models are seen in several airlines that further complicate the accurate assignment to the Low-Cost Market. In this Monitor issue, the authors currently identify 20 airlines (among all airlines operating on German airports) providing completely or partly LCC services. These are in detail (see also table 1): Aer Lingus (EI) (www.aerlingus.com), Fleet: 36 Aircraft (A320: 33, A321: 3) Air Arabia Maroc (3O) (www.airarabia.com), Fleet: 3 Aircraft (A320:3) Air Baltic (BT) (www.airbaltic.com), Fleet: 33 Aircraft (B737: 14, A320: 1, F50/70: 9, D8: 9) Air Berlin (AB) (www.airberlin.com), Fleet: 128 Aircraft (A319/20/21: 62, B737: 66) Blue Air (JOR) (www.blueair-web.com), Fleet: 9 Aircraft (B737: 9) Corendon (CAI) (www.corendon.com), Fleet: 6 Aircraft (B737: 6) Easyjet (U2) (www.easyjet.com), Fleet: 184 Aircraft (A319: 151, A320: 33) flybe (BE) (www.flybe.com), Fleet: 67 Aircraft (D8: 49, E: 18) Germanwings (4U) (www.germanwings.com), Fleet: 32 Aircraft (A319: 32) Iceland Express (5W) (www.icelandexpress.com), Fleet: 5 Aircraft (B737: 4, A320: 1) Intersky (3L) (www.intersky.biz), Fleet: 3 Aircraft (D8: 3) Jet 2 (LS) (www.jet2.com), Fleet: 36 Aircraft (B737-300: 27, B757-200: 9) Niki (HG) (www.flyniki.com), Fleet: 20 Aircraft (A320: 9, A321: 4, E: 7) Norwegian (DY) (www.norwegian.no), Fleet: 63 Aircraft (B737: 63) Ryanair (FR) (www.ryanair.com), Fleet: 293 Aircraft (B737: 293) Transavia (HV) (www.transavia.com), Fleet: 23 Aircraft (B737: 23) Vueling (VY) (www.vueling.com], Fleet: 46 Aircraft (A320: 46) Windjet (IV) (www.windjet.it), Fleet: 12 Aircraft (A319: 5, A320: 7) Wizz (W6) (www.wizzair.com), Fleet: 35 Aircraft (A320: 35) Wizz Ukraine (WU) (www.wizzair.com), Fleet: 2 Aircraft (A320:2) (A: Airbus, B: Boeing, C: Canadair, D: Dash, E: Embraer, F: Fokker, MD: B/McDonnell, S: Saab) Flights offered by Condor or LTU are not considered in this analysis, although these airlines also offer a number low-cost flights. But an unambiguous assignment to the Low-Cost sector is considered to be difficult because only selected flights can be booked directly and with low fares. This contradicts the real Low-Cost Carrier conception according to which all flights (or at least the bulk of the seat quota) should be available for booking online at a low price that is generally available and referring mainly to the actual advance booking period, respectively to the day of travel as well as to the booking situation. In a broad sense, Lufthansa flights of the Better-Fly -segment have to be taken into consideration as well, but here exists also only a strictly limited seat quota. An unambiguous assignment is not possible. The airline Air Berlin, who is running several business models, is one of the grey area. For this former charter airline, who has intervened early in the Low-Cost Market by launching the segment Cityshuttle, the identification of Low Cost routes has become much more complicated due to the mergers with DBA, Gexx and LTU as well as the cooperation with Walter airline (LGW). Thus, only the presently existing Low Cost routes served by these airlines as well as the corresponding ones are being considered, but not the flight routes to typical holiday destinations like North Africa or other intercontinental connections. Some time ago, Air Berlin has newly added the city links, previously operated by TUIfly, some of which, however, have already been ceased again in the meantime. In total, when compared to last spring, the number of Low-Cost Carriers operating in the German market has remained constant. 2

Most airlines have kept their fleet size relatively constant. Only Ryanair show a strong increase of 30 airplanes as opposed to the last spring. Thus, Ryanair has a fleet of 293 aircraft, type Boeing 737-800, equipped with about 190 seats each. Carrier Ranking (s. Tab. 1): Based on the number of flights (departures) in one week in January 2012, the Low-Cost segment of Air Berlin is by far the largest one in Germany. However, the air traffic figure is by 12% lower than in the preceding year. This trend is, among other reasons, based on Air Berlin s comprehensive programme of capacity reduction, including also their withdrawal from several regional airports. Whereas during the past years until 2008 high yearly growth rates have been achieved in the Low Cost sector, a reversal already indicated in summer 2008, when the growth rates dropped distinctly. This decline continued until summer 2009. After a further consolidation phase, positive growth rates were seen again for most airlines since the beginning of the year 2010 - a trend that continued also in summer 2010. Since early 2011, however, there is a new decrease in the number of take-offs offered. In July 2011, these values were lower by11% compared to the year of 2010, an effect caused partly by the implementation of the air traffic tax in Germany as of 1 st January 2011. This trend continued also in the beginning of 2012, according to which the number of take-offs in the Low Cost sector dropped again by 14%, compared to 2011. According to the ranking, Germanwings (715 flights) and Ryanair (383 flights) follow. For Ryanair, the trend observed regarding reduction in flights offered in Germany is continuing, after Ryanair carried out a policy of expansion in Germany until then. This way, Ryanair could continuously increase the number of flights on a high level even throughout the entire economic crisis, whereas almost all other major Low Cost Carriers have reduced their supply during this period. All intra-german domestic flights served by Ryanair have been ceased in March 2011. Also here, one of the major reasons was, according to Ryanair, the implementation of the German air traffic tax. For Easyjet, a return to a higher growth in supply is seen after a period of rigid reductions since 2010. This is due to the considerable expansion of the service in Berlin and by extensions in Cologne-Bonn, Duesseldorf, Hamburg and Munich, as well as the addition of new flights from Dresden. Although the number of Easyjet s routes increased slightly in early 2012, but there were also simultaneously frequency reductions by more than 10%. Also for the rest of 2012, Easyjet announced further reductions, particularly at Dortmund airport. The Austrian airline Intersky and the Hungarian airline Wizz follow on places 5 and 6. Whereas Intersky reduced their frequencies by nearly 20%, there was an increase of more than 20% for Wizz. Flights performed by all other Low Cost Carriers distinctly amount to less than 70 flights per week. LCC Market Shares (s. Fig. 1): The six major of 20 Low Cost Carriers currently cover roundly 92% of the German market. Just Air Berlin covers around 47% of all flights. On the market share ranking list, it is followed by Germanwings (20%) and Ryanair (11%.). Easyjet have been able to increase their share to 9% owing to the declines of shares of Air Berlin and Ryanair. Transport Services Routes (s. Tables 1 and 2 as well as Fig. 2): In total, the analysed Low Cost airlines served 454 different domestic and cross-border routes in one week in January 2011. These are roundly 50 routes less than in winter 2011, which equals to a decline rate of more than 10%. Thus, after route closures in 2009 and a rise in 2010 since summer 2011 again a decline in the route development that still continues in 2012. While during the last winter period the pre-crisis level was exceeded by strong growth, this winter it is only up to the level of the crisis year of 2009. Also the number of flights is declining sharply compared to the preceding year (-14%), that according to various airlines is also due to the new air traffic tax. While since the emergence of the Low Cost market roundly 9 years ago, in the first 6 years, almost 100 routes have been added each year, a crisis of the world economy and of air transport was already looming in summer 2008, when only about 50 routes have been additionally covered by LCC s. In spring 2009, for the first time, there was a decline compared to the reference period. But already in summer 2009 a positive growth of routes was seen again that continued in spring 2010 and arrived at a new peak in summer 2010 (with more than 700 routes) or in winter/spring 2011 (with more than 500 routes) respectively. Although, the financial and economic crises in Germany seems to be over some companies did better than others but with the introduction of the air traffic tax there is a new inhibitory effect. While some small airlines left the market during the crisis period, in this period between spring 2008 (94 routes) and winter/spring 2011 (139 routes) Ryanair have carried out a significant network extension with a total of 45 additional routes. Here, in particular, the airports Niederrhein, Berlin-Schoenefeld, Bremen and Memmingen have been involved, since Ryanair have mainly extended their route networks from these airports. In parallel with Ryanair s high reduction of flight 3

routes this year in the winter season, it comes also to a reduction in the number of flights by almost 40%. Particularly affected by this are the airports Niederrhein and Berlin-Schoenefeld where about 70 weekly flights were ceased, as well as Hahn with about 60 flights less. The airports Altenburg, Friedrichshafen and Magdeburg-Cochstedt are not being served anymore, but Leipzig and, since May 2012, there are also Ryanair flights from the Cologne-Bonn airport. While Easyjet extend their flights in spring 2011, they reduced their supply by more than 10% this year. Air Berlin also reduced their number of flights in the considered segment that is attributable to the Low Cost segment by 10% that equals to 200 flights per week. Here, particularly affected are the Cologne-Bonn and Hamburg airports where 30 flights are being offered less. In contrast to this, Germanwings only slightly reduced their number of flights, but here also, the most affected - with a decline of 14 flights per week is the Cologne-Bonn airport. However, at the same time the route network was extended by more than 10%. It should be noted, that for domestic flight routes double counting should be taken into account (for example, outward MUC-DUS and return DUS- MUC). After Air Berlin, TUIfly, Germanwings, Ryanair and Intersky had started to serve more domestic routes in the years before, the reduction of domestic flight routes, already started last year, has deepened with roundly 10% as opposed to the preceding year. There were no new service priorities in the last year. Competition: Direct competition among carriers in the Low Cost range has further decreased, only on 11 (2.4%) of the total number of 454 routes two airlines are competing. There are no routes served by more than 2 airlines. 443 routes - the major part - are being served by a single airline. Flights (s. Table 1): In total barely 3.500 flights have been performed by Low Cost Carriers in one week in January 2012. One year before, it was still more than 500 flights. Thus, the number of flights has decreased by 14%, and even more the number of seats reduced, namely by 16%, whereas the number of routes has decreased by 10.6%. This means the network has slightly been decreased while the frequency has been reduced at the same time. Seats (s. Table 1): On 3,522 flights on average 151 seats per flight have been made available, a similar value like in the preceding year. Obviously, for Low Cost Carriers a typical average scale airplane with around 150 seats has established. However, Ryanair, the major Low Cost Carrier uses only 189 seats per flight in their B737-800. These flight-specific seat capacities continue ranking distinctly higher than those of traditional European scheduled airlines. When considering the fleet composition of the individual airlines the tendency of disposing small-scale aircraft is revealed. Typical aircraft are Airbus 319/320 and Boeing 737. Only a few airlines, such as Intersky or flybe have smaller propeller aircraft in their fleets. Destinations (s. Table 2): The country of destination ranking reveals the high market share of German domestic traffic: Roundly 45% of all Low Cost Carrier flights departing from German airports are offered in this market, that makes only up 20% of all routes (roundly 94 routes corresponding to 47 airport pairs). On average, 17 Low-Cost domestic flights per week are being offered on a route. In the winter months, Great Britain and Spain rank second and third with their round 370 and 250 flights respectively. Austria ranks ahead of Italy and Switzerland on place 4. These are followed by Russia, Ireland and Latvia on places 7 to 9 ahead of Norway and Sweden. In particular inside Germany and to Great Britain, Spain and Austria a decline of Low Cost services is seen as opposed to the preceding year. However, this is among others due to administrative reasons such as a more rigid charging policy, since both, Germany as well as Great Britain and Austria have implemented or raised an air traffic tax, which made several companies reduce their services in these markets. In total, German Low Cost Carriers currently serve destinations located in 34 countries. Only a slight expansion is seen to Eastern Europe. As opposed to the preceding year, newly added is only Cyprus. Airports (s. Fig. 3): The most frequented German airport Frankfurt continues playing only a minor role in the Low Cost segment in the spring 2012. This is due to its distinct hub function in traditional scheduled airline traffic and the already high utilisation of airport capacity. Thus, only 81 flights (roundly 2%) have been performed mainly by Air Berlin, Niki or flybe as Low Cost flights. Cologne-Bonn shows with 386 departures (equals to 61% of the total local flight traffic) a roundly 12% lower value than in the preceding year and is only number 2 in the German airport ranking offering the highest number of Low Cost flights; behind Berlin-Tegel and ahead of the Berlin-Schoenefeld airport. Whereas the Low Cost percentage of Schoenefeld amounts to roundly 4

82%, the one of Tegel amounts to 37% only. Although the Low Cost traffic has decreased on almost all German airports, it was able to increase its supply of flights in Berlin-Tegel by 8 flights per week. Opposed to this, the Low Cost traffic developed significantly decreasing on airports where that were characterised by high growth in the past, is for example Niederrhein, Luebeck or Hahn. As a consequence, the number of Low Cost flights fell e.g. at Niederrhein by 42% or by more than 70 flights per week. Such a loss is particularly serious for airports holding a high Low-Cost percentage. With more than 90% share of scheduled airline services, the airports Niederrhein, Luebeck, Memmingen, Karlsruhe/Baden-Baden and Hahn almost exclusively Low Cost Carrier transport is practiced. To a less extreme extent, the same is true for the Dortmund and Berlin-Schoenefeld airports. Air Fares Average Fares The air fares offered by the major Low Cost Carriers in Germany are considerably varying related to destination and booking period. The prices publically quoted by the Carriers are often net prices, normally not including any fees, taxes or other charges. Thus, they are not meaningful. In order to allow for statements on final prices, the prices for LCC flights on 60 selected routes have been determined and evaluated for 4 different time points (advance booking periods of one day, one week, one month and three months). The selection of routes corresponds to a representative sample of around 10% of all LCC routes that were operated in spring 2012. The relatively constant route sample allows for a comparison with the results of the preceding analysis. This time, 15 th of May 2012 was selected as the posting date. In spring 2012, the average fares determined in this way for one route vary depending on the carrier between approx. 40 and 80 (net prices) and between 60 and 150 (gross prices). The difference between net and gross prices amounts to around 18 in the best case, and to 80 in the worst case. Meanwhile, many airlines do not show their net fares anymore. In the spring of this year - like every year - the average fares rose as opposed to the autumn/winter. Whereas the average fares of the inexpensive Low Cost Carriers have slightly climbed, there is a slight decrease of the more expensive ones have dropped, so that the price span is slightly closer. Average Prices related to Booking Period Low Cost Carrier air fares considerably vary according to the period between booking and flight operation: A flight, carried out one day after booking, often costs four to tenfold of a flight to be started in 3 months. However, this price range is not considered to be as pronounced as formerly. The average gross prices quoted by the major German Low Cost Carriers vary between approx. 110 and more than 200 for a flight with a booking period of only one day and between 44 and 95 for a flight to be started 3 months after the booking date. Most of the cheapest flights with a long booking period only cost up to about 50, but often climb to values of more than 100, if the flight is to be started on the next day. However, these values do not refer to the number of tickets actually sold at these prices, since there is no assured information on the quantity of seats sold at the respective rates. A detailed analysis of Low Cost Carrier air fares in Germany can be found on the DLR website (www.dlr.de/fw). Passenger Demand In 2011, in total 199.7 million passengers were counted on the 26 international and regional airports. Thereof, 64.1 million departing and arriving passengers are to be allocated to the Low Cost segment (s. Table 3). This corresponds to a percentage of 32.1%. This percentage considerably varies referring to the individual airports. For the hub-airport Frankfurt the LCC-percentage is the lowest (4%), whereas the Low Cost Airports Hahn, Luebeck, Memmingen and Niederrhein are almost exclusively characterized by this traffic segment. Also the airports Berlin-Schoenefeld, Cologne/Bonn, Dortmund, Karlsruhe/Baden-Baden, Friedrichshafen and Rostock/Laage mainly feature these Low Cost services. After the traffic decline in 2008/09 marked by the financial and economic crises, air traffic has recovered in 2010. The number of passengers has grown by 4.8% in 2011 in comparison with the previous year. Since for the purposes of demand determination in the Low Cost traffic for the first time the MIDT-data, supplied by Sabre, have been applied, that are not necessarily compatible with those data supplied by the airlines in former years, a statement as to the growth in passenger demand in this segment can only be made to a limited extent. When combing the data sources in the area of supply and demand, it can be concluded that in the Low Cost traffic the total number of passengers carried decreased by 1 million or about 2% in 2011. At the same time, the number of 5

flight deals fell sharply with a simultaneous increase in the total German air traffic. Thus, the proportion of passengers carried by the Low Cost traffic of 34% is decreased to 32%. Based on the original domestic demand (disregarding the transfer traffic) the LCC suppliers show high to very high market shares for domestic flights (s. Table 4) on most airports apart from the airports Frankfurt, Bremen and Paderborn. In total, about 43% of passengers are carried on domestic flights operated by Low Cost Carriers. This is a decline of over 5 percentage points compared to last year. At the airport Berlin-Schoenefeld, almost all the demand is served by Low Cost deals. In contrast, the inner-german Low Cost flights were completely stopped at airports such as the Niederrhein and Hahn since the end of 2010/beginning of 2011. Although the LCC percentage amounts only to 40% at the airport of Munich, this airport shows the highest passenger traffic in the Low Cost area (3.4 million), followed by the airports Berlin-Tegel (3.4 million), Cologne/Bonn (2.5 million), Hamburg (2.3 million) and Duesseldorf (2.3 million). 6

The current Low Cost Carrier Market in Europe Besides the detailed analysis of the German Low Cost Carrier market, also the main features of the European LCC-market are described here. In addition to the airlines already operating in the German market, further airlines can be allocated to the Low Cost Carrier market. However, the number of those airlines is increasing, that are involved in the classical regular and charter flights as well as in the pure Low Cost segment, such as Air Berlin in Germany. Hence, the distinction between classical airline carriers, holiday airlines and Low Cost Carriers becomes increasingly complicated. Consequently, this analysis cannot be considered to be complete, but it is intended to approximately inform on the extent and structure of the European Low Cost market. Besides the airlines operating in the German market the following are actors in the European market: Air Italy (I9) (www.airitaly.it), Fleet: 11 Aircraft (B737: 7, B767:4) Blu Express(BV) (www.blu-express.com), Fleet: 4 Aircraft (B737: 4) Bmibaby (WW) (www.bmibaby.com), Fleet: 14 Aircraft (B737: 14) Jet4you (8J) (www.jet4you.com), Fleet: 4 Aircraft (B737: 4) Meridiana (IG) (www.meridiana.com), Fleet: 23 Aircraft (A319: 3, A320: 12, MD82/83: 5, ATR: 3) Transavia France (TO) (www.transavia.com), Fleet: 6 Aircraft (B737: 6) Volare (VA) (www.volareweb.com), Fleet: 1 Aircraft (A320: 1) To an increasing extent also non-european Low Cost Carriers serving Europe are entering the market. These are among others: Air Asia X (D7) (www.airasia.com), Fleet: 11 Aircraft (A330: 9, A340: 2) Flydubai (FZ) (www.flydubai.com), Fleet: 22 Aircraft (B737: 22) In total, compared with the previous year, the number of Low Cost airlines operating in Europe has decreased slightly. In the meantime, the Russian Low Cost Carriers Sky Express and Avia Nova have ceased their operations. Flybaboo also no longer fly as a separate brand. The major European Low Cost airline is Ryanair with 7,300 departures in January 2012 (s. Table 5). For the first time, they show a decrease of roundly 4% compared with the previous year. Second major airline is Easyjet with roundly 6,000 departures. They also reduced their flights by offering about 8% less than last year. Whereas Ryanair have cancelled roundly 80 routes, Easyjet have added 30 routes. After a big gap, they are followed by the airline flybe that was able to extend their services by 8% to more than 3,000 flights. As a consequence and owing to the decrease of around 2,400 flights offered per week, Air Berlin is only ranking fourth amongst the Low Cost Carriers in Europe. Norwegian, in contrast, has extended their flights in the meantime and is fifth, with more than 2,100 departures. Wizz, Vueling, Germanwings and Air Baltic follow with between 1,000 and 2,000 departures per week. Whereas Wizz, too, have considerably extended their services, that of Vueling remained almost constant. Thus, the consolidation in the Low Cost Carrier range is continuing. While airlines such as, for example, Clickair have been integrated into a larger Low Cost Carrier such as Vueling, others such as Air Italy have been taken over by former national carriers like Alitalia, and still others such as Sky Europe had to file for bankruptcy. Although some airlines expanded their offerings again or further, there is also a group of airlines such as e.g. Ryanair, that are permanently expanding until summer 2011. Now it seems that these companies have reached a certain saturation point. Thus, on European level unlike in Germany there is a low growth of the number of routes of 1.2% compared to the considered analysis period 2011. As opposed to this, a decline of 10% is seen in Germany. Although a decrease is seen of flights offered by about 3%, it is significantly lower than in Germany where there is a decrease of 14%. The reason is the already frequently mentioned implementation of the air traffic tax in Germany since 1 st January 2011 and the subsequent shifting or ceasing of flights in Germany. Similar tendencies are seen in Ireland, where an air traffic tax has also been implemented in March 2009. Here, the number of flights is stagnating on a level of approximately 1,300 departures or around 145 routes. Great Britain is, as source and destination country for Low Cost flights still number 1 (s. Table 6). In winter/spring 2012, the British network is covering more than 800 routes all over Europe, including the domestic traffic. Also here, stagnation is observed with regard to the number of routes since 2009. A decrease in the number of flights is also seen since last year, possibly owing to the raised air traffic tax levied in this country. The number of flights dropped slightly from around 7,800 to currently 7,200 in the observed period. Italy, Spain and Germany follow on the next places with about slightly more than 3,500 flights each. France, Norway and Ireland rank on places 5 to 7 with more than 1,000 flights each. 7

Out of the total of 4,600 different routes, more than 4,300 (94%) are being served by only one Low Cost Carrier. Only 274 flight routes are served by 2 and 16 flight routes by more than 2 Low Cost Carriers being in the state of competition. This means that even in Europe, the number of routes where direct competition takes place has been greatly reduced. Due to the strong route extension, among others, by Easyjet or Norwegian, London-Gatwick is the major European Low Cost Carrier airport now - with more than 1,100 LCC departures per week in January 2012 (s. Fig. 4). The airports Barcelona (1,054 departures), Dublin (984 departures) and London-Stansted (948 departures follow immediately. The third London airport Luton is number 9. More than 2,500 Low Cost flights are provided in total from the London airports. This figure is not topped by any other European agglomeration. Berlin-Tegel, with its 462 departures, ranks on place 15. Among the 30 major Low Cost Carrier airports in Europe range Cologne/Bonn (place 17), Berlin- Schoenefeld (place 19), Munich (place 21) and Duesseldorf (place 22) as well as other German airports where the Low Cost Carriers serve more than 350 flights per week. When looking at the ranking of German airports providing Low Cost service it becomes obvious that particularly the airport Berlin-Schoenefeld has worsened if compared with winter 2011. It has deteriorated from 14 th to 19 th place in the ranking. This is, among other things, due to the strong reduction of Ryanair s offer in Berlin. The Low Cost Carrier market could not further increase its share of 24% in the area of European air traffic (s. Fig. 5). 76% of the flights are mainly performed by the traditional scheduled airlines and holiday charters. Another part of the market is served by smaller regional airlines but mostly cooperating with a large air company. 8

Low Cost Carrier Market in Germany 01/2012 01/2011 Change (%) Rank Airline Departure Seats Routes* Departure Seats Routes* Departure Seats Routes* 1 Air Berlin 1,650 248,886 142 1,886 290,045 163-12.5-14.2-12.9 2 Germanwings 715 102,960 91 728 109,174 82-1.8-5.7 11.0 3 Ryanair 383 72,387 107 624 117,936 139-38.6-38.6-23.0 4 Easyjet 328 51,864 48 374 58,744 47-12.3-11.7 2.1 5 Intersky 75 4,050 8 92 4,968 10-18.5-18.5-20.0 6 Wizz 75 13,500 20 62 11,160 19 21.0 21.0 5.3 7 flybe 68 5,228 9 113 8,630 12-39.8-39.4-25.0 8 Aer Lingus 53 9,222 7 54 9,396 6-1.9-1.9 16.7 9 Air Baltic 45 3,602 5 45 4,032 6 0.0-10.7-16.7 10 Norwegian 43 7,594 9 32 5,270 7 34.4 44.1 28.6 11 fly Niki 30 3,954 2 32 4,246 4-6.3-6.9-50.0 12 Wizz (Ukraine) 16 2,880 4 17 3,060 6-5.9-5.9-33.3 13 Vueling 13 2,340 1 0 0 0 100.0 100.0 100.0 14 Corendon 7 1,155 5 7 1,110 7 0.0 4.1-28.6 15 Jet2 6 888 1 6 888 1 0.0 0.0 0.0 16 Transavia 5 738 2 5 610 2 0.0 21.0 0.0 17 bmybaby 4 558 1 7 985 2-42.9-43.4-50.0 18 Blue Air 2 310 1 4 606 2-50.0-48.8-50.0 19 Air Arabia Maroc 2 324 1 3 450 2-33.3-28.0-50.0 20 Iceland Express 2 296 1 3 447 2-33.3-33.8-50.0 21 Windjet 0 0 0 2 360 1-100.0-100.0-100.0 3,522 532,736 465 4,096 632,117 520-14.0-15.7-10.6 Table 1: Low Cost Carrier Ranking according to the number of flights performed (during one week in January, domestic routes are counted twice, within Europe only in one direction). *Routes served by several carriers are counted twice. Others Figure 1: Low Cost Carrier Market Share in Germany (according to number of flights performed during one week in January 2012). 9

Low Cost Carrier Market in Germany 01/2012 01/2011 Change (%) Rank Destination Departures Seats Routes Departures Seats Routes Departures Seats Routes 1 Germany 1,631 235,595 94 1,849 279,640 107-11.8-15,8-12.1 2 Great Britain 366 53,171 48 487 69,075 55-24.8-23,0-12.7 3 Spain 246 43,806 62 300 53,230 66-18.0-17.7-6.1 4 Austria 240 33,520 21 285 39,612 30-15.8-15.4-30.0 5 Italy 238 37,459 66 305 49,588 67-22.0-24.5-1.5 6 Switzerland 129 20,334 10 137 21,646 10-5.8-6.1 0.0 7 Russia 73 12,450 10 62 10,512 9 17.7 18.4 11.1 8 Ireland 67 11,868 10 74 13,176 9-9.5-9.9 11.1 9 Latvia 54 5,303 8 53 5,659 8 1.9-6.3 0.0 10 Sweden 53 9,210 12 64 10,895 15-17.2-15.5-20.0 11 Norway 51 8,378 10 61 10,503 13-16.4-20.2-23.1 12 Poland 51 8,844 12 61 10,629 18-16.4-16.8-33.3 13 France 37 6,132 7 60 9,181 10-38.3-33.2-30.0 14 Denmark 30 4,452 4 33 5,064 4-9.1-12.1 0.0 15 Portugal 25 4,482 7 31 5,559 10-19.4-19.4-30.0 16 Serbia 25 3,780 12 17 2,642 8 47.1 43.1 50.0 17 Finland 24 4,083 5 24 4,132 5 0.0-1.2 0.0 18 Netherlands 23 3,510 4 17 2,482 3 35.3 41.4 33.3 19 Hungary 22 3,396 6 26 4,040 6-15.4-15.9 0.0 20 Romania 22 3,694 8 24 3,966 8-8.3-6.9 0.0 21 Ukraine 16 2,880 4 17 3,060 6-5.9-5.9-33.3 22 Morocco 15 2,763 6 19 3,474 8-21.1-20.5-25.0 23 Greece 14 2,160 5 17 2,673 6-17.6-19.2-16.7 24 Croatia 14 2,040 5 16 2,400 5-12.5-15.0 0.0 25 Bulgaria 11 1,926 4 9 1,530 3 22.2 25.9 33.3 26 Belgium 10 1,560 1 13 2,028 1-23.1-23.1 0.0 27 Lithuania 10 1,872 3 12 2,153 4-16.7-13.1-25.0 28 Czechia 6 864 1 6 900 1 0.0-4.0 0.0 29 Estonia 6 1,134 2 3 567 1 100.0 100.0 100.0 30 Turkey 5 820 3 7 1,054 7-28.6-22.2-57.1 31 Bosnia 2 288 1 2 300 1 0.0-4.0 0.0 32 Cyprus 2 378 1 0 0 0 100.0 100.0 100.0 33 Israel 2 288 1 2 300 1 0.0-4.0 0.0 34 Iceland 2 296 1 3 447 2-33.3-33.8-50.0 Total 3,522 532,736 454 4,096 632,117 507-14.0-15.7-10.5 Table 2: Country of Destination Ranking according to Number of Flights (data are valid for one week in January; within Germany both directions of one route are considered) 10

465 495 507 454 Figure 2: Development of the LCC Route Network on German Airports Flights / Week LCC Flights / Week Number of Departures Airport Figure 3: Passenger-carrying Flights on German Airports per week in January 2012 11

Low Cost Carrier Market in Germany Airport Passengers 2011 (in thousand) Percentage % Total LCC Share of total LCC TXL 16,899 7,874 46.6 DUS 20,315 7,497 36.9 CGN 9,602 6,844 71.3 MUC 37,634 6,013 16.0 SXF 7,100 5,957 83.9 HAM 13,535 4,844 35.8 STR 9,542 4,500 47.2 HHN 2,834 2,834 100.0 NRN 2,418 2,418 100.0 HAJ 5,305 2,330 43.9 NUE 3,940 2,074 52.7 FRA 56,293 1,774 3.2 DTM 1,814 1,759 97.0 BRE 2,552 1,435 56.2 FKB 1,108 1,098 99.1 DRS 1,903 875 46.0 FMO 1,312 851 64.9 FMM 765 765 100.0 LEJ 1.835 671 36.5 PAD 963 466 48.3 FDH 568 406 71.5 LBC 344 344 100.0 SCN 413 227 55.1 RLG 224 147 66.0 ERF 270 121 44.8 ZQW 223 3 1.5 Total 199,711 64,058 32.1 Table 3: Low Cost Passenger Traffic according to Airports and the Share of Total in 2011 (References: ADV, Sabre, DLR) 12

Low Cost Carrier Market in Germany Airport Passengers on German Domestic Flights in 2011 (in thousand) LCC Share on German Domestic Flights MUC 3,776 38.6 TXL 3,410 47.9 CGN 2,496 70.4 HAM 2,328 41.2 DUS 2,295 50.0 STR 1,779 60.3 SXF 892 99.2 NUE 844 56.3 DRS 543 45.5 FRA 510 7.5 HAJ 495 41.1 FKB 284 99.5 LEJ 265 38.3 FMO 233 45.8 FDH 183 66.2 DTM 176 99.8 SCN 161 65.0 BRE 64 7.9 PAD 32 19.6 ERF 16 40.6 HHN 5 100.0 NRN 3 100.0 FMM 0 0.0 LBC 0 0.0 RLG 0 0.0 ZQW 0 0.0 Total 20,847 43.1 Table 4: LCC Passengers on German Domestic Flights, according to Airports and LCC Share in 2011 (References: ADV, Sabre, DLR) 13

Low Cost Carrier Market in Europe 01/2012 Rank Airline Departures Seats Routes Table 5: 1 Ryanair 7,359 1,390,851 1,513 2 Easyjet 6,067 967,188 807 3 Flybe 3,020 214,146 286 4 Air Berlin Euro Shuttle 2,384 367,776 266 5 Norwegian 2,159 388,128 326 6 Aer Lingus 1,446 226,469 149 7 Wizz 1,348 242,640 368 8 Vueling 1,272 228,960 117 9 Germanwings 1,012 145,728 155 10 Air Baltic 793 66,949 86 11 Meridiana 519 69,707 98 12 Transavia 442 62,372 98 13 Windjet 428 68,376 54 14 fly Niki 377 50,962 77 15 bmybaby 276 40,494 44 16 Corendon 245 41,140 113 17 Volareweb 223 31,272 26 18 Blu Express 209 35,548 36 19 AviaNova 194 30,846 39 20 Jet 2 187 29,421 65 21 Blue Air 163 25,398 46 22 Air Italy 150 23,608 25 23 flybaboo 128 7,024 14 24 Intersky 84 4,536 10 25 Transavia.France 70 13,020 23 26 Wizz Ukraine 66 11,880 16 27 jet4you 65 11,245 27 28 Air Arabia Maroc 48 7,776 18 29 flydubai 37 6,993 11 30 Iceland Express 35 5,291 7 31 AirAsiaX 10 2,400 2 Total 30,816 4,818,144 4,922 Ranking of Low Cost Carriers operating in Europe according to Number of Departures in 01/2012 (Figures for one week in January; both directions of one route are considered) Low Cost Carrier Market in Europe 01/2012 Rank Country Departures Seats Routes 1 GB 7,178 971,369 831 2 IT 4,512 748,767 657 3 ES 3,826 685,956 636 4 DE 3,522 532,736 454 5 FR 1,717 285,990 308 6 NO 1,329 229,840 172 7 IE 1,297 215,632 143 8 NL 805 126,576 126 9 CH 782 117,627 105 10 SE 615 107,758 103 11 PL 589 105,203 164 12 AT 541 77,170 101 13 FI 538 54,010 66 14 LV 471 48,689 61 15 BE 446 78,374 81 16 PT 404 69,959 78 17 DK 361 61,646 54 18 RU 331 53,115 67 19 RO 294 49,471 73 20 TR 160 26,870 64 21 LT 155 23,361 34 22 CZ 140 23,486 32 23 HU 134 23,115 30 24 EE 128 12,650 18 25 BG 82 13,634 20 26 GR 78 12,915 20 27 RS 74 11,041 28 28 UA 73 10,908 15 29 MT 53 9,657 21 30 SK 45 8,505 12 31 CY 39 6,891 13 32 HR 20 2,976 7 33 IS 19 2,923 4 34 GI 9 1,404 2 35 MK 9 1,544 4 36 AZ 7 1,323 1 37 SI 7 1,092 2 38 AM 6 1,134 1 39 MD 6 990 2 40 BA 5 753 2 41 GE 5 792 2 42 BY 4 292 1 Total 30,816 4,818,144 4,615 Table 6: European Country Ranking according to the Number of LCC Departures in 01/2012. (Figures for one week in January; both directions of one route are considered)

Flights / Week LCC Flights / Week Number of Departures per week Figure 4: Major LCC Airports in Europe according to Flights per Week in January 2012 Other Airlines 76 % Figure 5: Share of LCC on European Air Traffic according to the Number of Departures in January 2012 Contact: Dr. Peter Berster Deutsches Zentrum für Luft- und Raumfahrt (DLR) Flughafenwesen und Luftverkehr (FW) Linder Höhe D-51147 Köln Tel.: (49) 02203-601-4554 Fax: (49) 02203-601-14554 E-Mail: peter.berster@dlr.de