by Florian Hielscher, uro on Sunday

    This may sound like a bad joke to many travellers: while thousands of holidaymakers are struggling with delays and flight cancellations at German airports, more than 360 flights are said to take off from Frankfurt Airport in a period of one week – without passengers. According to reports, Lufthansa only transports crew members or luggage with the so-called “ghost flights”. One reason: the crane airline sends vacationers their luggage that could not be cleared in time for departure and now follows separately.

    The reason for the problems at German airports is quickly identified: there is a lack of staff. This misery comes at the worst possible time for the airlines. After difficult months due to the pandemic, in which global travel activities were sharply reduced, pent-up desire to travel and relaxed corona restrictions should revive business with airlines. As expected, the number of bookings is high: in April this year, around five times more travelers used German airports than in the same month last year.

    surprising crowd

    Stephen Schulte, head of the airport operator Fraport, had not expected such a high volume of travel. Around 70 to 75 percent of the pre-crisis level was expected. At the moment it is still partly above that, at peak times it is even at the level before Corona. “That surprised us. I openly admit that we were wrong,” said Schulte.

    The airlines are reacting to the onslaught, for example want to reactivate the world’s largest passenger aircraft, the Airbus A380, which has been decommissioned in many places. But even the largest aircraft is of little use if there is no crew flying with it.

    The problems are to a certain extent home-made: During the pandemic, demand and sales collapsed drastically, airlines like Lufthansa were on the verge of bankruptcy. Accordingly, the staff was drastically reduced, many jobs cut. Since these cannot be filled to the full again, there is a massive lack of staff. Workers from Turkey are now to remedy the situation. Approximately 2,000 people are to be recruited for handling at German airports, but companies’ reported requirements are well below this. However, since the new workforce cannot be deployed immediately, complicated summer months are to be expected for airlines and passengers.

    An enormous demand is faced with an ever smaller supply. Lufthansa, Germany’s most important airline, has already canceled more than 3,000 flights for July and August. British Airways is also drastically reducing its offering, canceling more than 10,000 short-haul flights by the end of October. Not only are there masses of vacationers, there is also a shortage of personnel in freight traffic.

    It becomes even more difficult when available personnel stop working. In Spain, further strikes by cabin crew and pilots at Ryanair and easyJet are planned. The workers are demanding higher wages and better working conditions. The strikes put an additional strain on the capacities, which are already tight.

    Flying is too cheap

    Accordingly, there is currently a large discrepancy between supply and demand. Analyst Guido Hoymann from Bankhaus Metzler doesn’t see this as a huge problem for the airlines: “As far as the enforceability of higher prices is concerned, the scarcity caused by disruptions such as a lack of staff may even help them a little at the end of the day.”

    After all, the mechanisms of the market are currently causing rising ticket prices, with which the airlines can pass on higher costs for fuel, personnel and inflation: “For the people who absolutely want or have to fly now, the offer is about sufficient for them, they also seem to be appropriate ready to be able to and want to pay these prices.

    Michael OLeary, head of low-cost airline Ryanair, is also promoting higher prices. Air travel has now become “too cheap” and prices will have to rise over the next five years. OLeary illustrated this using the example of its own airline: Due to increased oil prices and higher environmental taxes, the cost of an average Ryanair ticket could rise from 40 to 50 to 60 euros. The Lufthansa subsidiary Eurowings also recently announced that it would increase its prices by at least ten percent.

    Hoymann sees this as a step in the right direction. The low prices were no longer at which most competitors could still make reasonable profits. He doesn’t see a problem in the fact that the current oversupply of aircraft capacity is now being slowed down: “This unforeseen disruption isn’t all that bad for the industry, because it’s finally leading to a rational offer of capacity.”

    Despite the lower supply, the industry is optimistic. The International Air Transport Association (IATA), the umbrella organization for airlines, expects the aviation industry to return to profitability in the coming year. IATA predicts that pent-up demand and travel will keep the number of bookings going even if the global economy is strained.

    Opportunity for budget airlines

    However, there are also beneficiaries from the increased cost factors. According to analysts at information service provider Bloomberg, low-cost airlines could particularly benefit from rising energy costs and pressure on consumer incomes, and gain market share on short-haul routes. The increasing price sensitivity of travelers could lead to providers such as Ryanair, easyJet or Wizz Air reaching around half of the inner-European passenger kilometers by 2024.

    Irish Ryanair and Hungarian competitor Wizz Air had already reported significant increases in passenger numbers in June; at Ryanair, the load factor was 95 percent for the first time since the pandemic began. In June, the airline transported 15.9 million passengers, more than ever before. As a result, ghost flights without passengers are unlikely to have been an issue for the Irish airline.



    Logistics entrepreneur Klaus-Michael Khne recently increased his stake in Lufthansa from ten to around 15 percent, thereby ousting the federal government as the largest single shareholder. After losses and the threat of insolvency due to Corona, there is great hope for a comeback. The number of bookings is high, and it is questionable how long the shortage of staff will last. Analysts are divided: Among the experts surveyed by Bloomberg, buy, hold and sell recommendations for the paper are roughly balanced. Wait.


    The Irish low-cost airline is already flying again with high occupancy. Ryanair should fare better in an environment of higher interest rates and higher costs. The company will likely raise prices. However, the current strikes are a burden and could result in higher wage expenses. Nevertheless: If travelers pay more attention to the price in the future, this will benefit Ryanair. Our favorite in the sector. However, investors should note the stop.


    The company operates an aviation hub at Frankfurt Airport and has holdings in other airports in Germany and abroad. In June, the number of passengers more than tripled compared to the same month last year, but was below the pre-crisis level. After Fraport recently did not pay out a dividend, analysts surveyed by Bloomberg are speculating on a return to the dividend for the 2023 financial year. Not cheap, but attractive in the long term.


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