Trends in European Airline Markets: Competition, Concentration and Strategic Behaviour

• Maria Cristina Barbot Campos e Matos

Faculdade de Economia do Porto, CETE

Evento

V SITRAER – Brasília, DF, Brasil, 25 a 27 de outubro de 2006

Volume

Avanços do Transporte Aéreo Brasileiro: V SITRAER – Simpósio de Transporte Aéreo

Páginas

14–21

Editores

Li Weigang, Érico Santana

Abstract

Alamdari and Mason (2006) apresentam um cenário para a indústria da aviação europeia, para 2010-2015. Este cenário contem uma elevada concentração do mercado, tanto no segmento das LCCs (low cost carriers) como no segmento das FSCs (full service carriers), o que contradiz o que se pretendia com a desregulamentação. Este artigo analisa as possibilidades da evolução em direcção a um tal cenário, através de considerações de ordem teórica e da análise das tendências recentes das companhias aéreeas europeias, com especial incidência no comportamento estratégico das LCCs e suas implicações na concentração da indústria. Analisamos ainda o papel das companhias aéreas portuguesas e brasileiras no contexto do referido cenário. Concluímos que a concentração sera muito mais provável no segmento low cost do que no segmento das grandes companhias aéreas. ABSTRACT Alamdari and Mason (2006) present a scenario for the European Airlines industry structure for 2010-2015. This scenario displays a high market concentration both in the LCC (low cost carriers) segment and the FSC (full service carriers) segment and contradicts what had been intended with deregulation. This paper analyses possible paths towards such a scenario, by means of theoretical considerations and recent trends in several European airlines, and with a focus on the strategic behaviour of LCCs and its implications in market concentration. We analyse the role of Portuguese and Brazilian airlines in the context of the referred scenario. We conclude that concentration in the low cost segment will be much more likely to occur than in the large network carriers segment. 1. FORECASTING TRENDS IN AIRLINE MARKETS: BACK TO THE PAST? The objectives of deregulation in the air travel industry were related to the increase in competition, allowing for new airlines to enter the industry, and so for a fall in prices and for a larger number of operations. In fact, with deregulation many new airlines started operating in Europe, mainly low cost carriers (LCCs). However, perspectives for the air travel industry in the near future do not seem to meet the deregulation objectives. A very interesting study by Alamdari and Mason (2006) instead suggests that by 2015 there will be more concentration, with fewer airlines and consequently a smaller amount of consumer welfare. Alamdari and Mason (2006)’s study was commissioned by the European Commission, which suggests that it will be a base for future po