Cologne-Bonn in Germany is set to join Frankfurt Hahn as the country's second budget airline hub, with Virgin Express and regional Lufthansa affiliate Eurowings in talks with the airport.

"We are in discussions with a number of operators in this sector," confirms Cologne-Bonn. Two years ago the airport had ramped up capacity to 12 million passengers in anticipation of future traffic growth, but only expects a throughput of 5.2 million this year, leaving plenty of room for new entrants. It has also lost important customers, including El Al and TNT, so has plenty of spare slots for carriers such as Eurowings and Virgin Express.

At the Farnborough air show in July, Virgin Group chairman Richard Branson said he envisaged Virgin Express as "a pan-European carrier", adding: "There is still an enormous market to be had."

Initially, Virgin Express is likely to get four daily slot pairs, according to the airport. However, the Brussels-based carrier is looking to ramp up operations from the following summer, with up to 20 aircraft operational from the German base from 2006. Recruitment of Germany-based crews and ground staff will start in the autumn, with the first flight in December this year.

The carrier says it will also reinforce its position in Brussels Zaventum, although the end of the commercial agreement with SN Brussels spells the end of its Brussels-London service.

Meanwhile, Virgin Express may not have it all its own way in Cologne. German regional Eurowings, which is 24.9%-owned by Lufthansa, is considering whether to set up a new low-cost base at either Cologne or shift its fleet of five Airbus A319s and one A320 from the charter sector into a new low-cost unit. Both Eurowings and Virgin Express hope to finalise their plans in August in time for the winter season.

These developments are the latest in a series of moves in the German airline sector prompted by the entry of low-cost carriers from the UK. Ryanair set up a base at Frankfurt Hahn last year and easyJet is sizing up Munich-based British Airways subsidiary DBA with a view to converting it into a budget carrier.

On the back of this, Berlin-based carrier Germania and transport conglomerate Preussag are considering setting up a new low-cost carrier in a joint venture.  Germania already offers cut-price fares on routes from Berlin Tegel to Frankfurt and, ironically, Cologne-Bonn.

Source: Airline Business