Fine Gael Raise Concerns Over Airline's Surcharge

Concerns have been raised over a €16 surcharge on all Lufthansa flights bought outside of the airlines own website.

Fine Gael MEP, and member of the EU Tourism Taskforce, Deirdre Clune, said that the surcharge will affect tickets bought for Lufthansa itself as well as other airlines in their control such as Austrian Airlines, Brussels Airlines and Swiss airlines.

It is understood that Deputy Clune has written to the European Commission regarding whether the new surcharge violates European Union rules governing anti-competitive practices.

This could open up the practice to other EU airlines to follow suit and charge a similar surcharge to travel agents and online booking sites such as Expedia, ebookers and Opodo.  

"My worry is that if all EU airlines begin adding surcharges to retail and online travel agencies, it will make flight price comparisons and booking onward connections with multiple airlines more complex and ultimately disadvantage European and Irish consumers – who may end up paying more for air fares or may be more limited in the choice of air connections they can use," Deputy Clune said.

"Airlines are pushing people to book flights on their own websites so that they can improve sales of add-on products such as extra legroom seats, excess baggage booking and car rental bookings.

"Lufthansa now operates 40 flights a week out of Dublin, and increased its Irish capacity by 11% last year, bringing to 500,000 the number of passengers who travel to and from Ireland every year – many of whom are tourists and investors. It's an important service but I am concerned that this new surcharge will lead to inefficiencies in the air travel market and higher air fares for EU consumers. This could have a knock on impact on tourism and investment in a small open economy like Ireland that depends so heavily on air traffic.

"Fiona Scott Morton, a Yale University economics professor who prepared a report for the Travel Technology Association concluded that airlines' latest efforts to place surcharges on online booking websites are aimed at limiting passenger ability to compare fares, rather than at lowering the carriers' costs. 

"She also concluded that the moves will lead to higher average airfares, increase consumers search costs and will make entry into city-pair routes by smaller airlines more difficult, thus strengthening the market power of the major airlines.

"I have referred this matter to the EU Commission for examination and to look to a way forward in protecting the right of a consumer to choice when booking flights."

(MH/LM)