A study by the European Low Fares Airline Association (ELFAA), targetted at winning political support in Brussels, claims that the low-cost sector is saving passengers €12 billion ($14 billion) a year on intra-European travel. The lobby group also says that its members have benefited Europe's regions to the tune of €3-4 billion through inbound tourism.

ELFAA says the €12 billion reduction in air fares is not just due to the lower fares offered by budget carriers. It is also a result of mainline carriers responding to low-cost airlines by reducing air fares. "If low-cost carriers cease to exist - heaven forbid - then fares would without doubt accelerate," says ELFAA secretary general Jan Skeels.

The study comes as the fledgling association strives to make its presence felt in Brussels, especially with the arrival of new transport commissioner, Jacques Barrot. The association is challenging the European Commission's (EC) regulation on passenger rights through the UK courts, and ELFAA president and Hapag-Lloyd Express chief executive Wolfgang Kurth says he is "very optimistic that this issue will go away".

ELFAA hopes the departure of former transport commissioner Loyola de Palacio will lead to a fresh assessment of the legislation. In common with other aviation lobby groups, ELFAA complains that the legislation was pushed through without adequate industry consultation.

The association is also launching an environmental study with Boeing pointing to the fact that low-fares carriers tend to have young fleets, using more modern, and therefore greener, aircraft.

Another issue on the horizon is an EC review of the relationship between publicly owned airports and private carriers. This follows an EC ruling that at least part of a support package offered by publicly-owned Brussels Charleroi Airport to Ryanair was illegal state aid and had to be paid back.

A full set of guidelines for public airport-airline deals was due to be issued in July, but this was delayed after Brussels lobbyists pointed out the widespread ramifications of this report on the industry. The issue date for the report was pushed back to September, but the EC has now indicated there will be a further delay, without giving any firm date.

Source: Airline Business