Is Europe an airline nightmare?

L'Europe is regularly pilloried by the leaders of IATAthe international air transport association. This was certainly the case at the 2025 Annual General Meeting, which has just ended in Delhi.

Rafael Schvartzman, Vice-President Regional Europe criticised the European authorities and their regulations, which are hampering the growth of air transport. They are making it increasingly expensive to operate airlines.

During a presentation to the international press, Rafael Schvartzman described the four ills afflicting European air transport:

1- Consumer protection regulations (EU261 regulations)
2. Sustainability (ReFuelEU)
3. Taxation
4. Imbalance between the performance and costs of airports and air navigation service providers (ANSP)

Consumer protection regulations (EU261 regulations)

When it comes to EU261 regulations, IATA is fundamentally at odds with the EU's stated objective of having air transport that better protects passengers. The association complains that EU261 generates 5 billion in costs for airlines.

However, there does seem to be a ray of light at the end of the tunnel. the EU would appear to be more sympathetic to the reforms demanded by IATA. The airlines are calling for the compensation threshold to be raised from 3 hours to 5 hours (short-haul flights) and from 5 hours to 9 hours for long-haul flights.. With the promise of fewer cancellations in return.

Sustainability (ReFuelEU)

Rafael Schvartzman believes that the introduction of more environmentally-friendly air transport should the EU has set the strictest environmental targets and mandates in the world. This would in fact hamper aviation's efforts to achieve carbon neutrality by 2050. " This makes the cost of sustainability unnecessarily high "insisted the vice-president.

The current mandate on mandatory use of green fuels (SAF) 2%, rising to 6% in 2030 for fuel suppliers is reflected in the prices offered to airlines in their contracts. According to IATA, the "ReFuelEU" rule translates into un additional bill of 1.7 billion dollars as compensation for not using SAF. If this money were really used to purchase sustainable fuel, it would reduce CO2 emissions by a further 3.5 metric tonnes. Every additional dollar of SAF compensation reduces the airlines' ability to buy sustainable fuel.

Taxation

As far as taxation is concerned, the outlook is hardly optimistic, although IATA does see some glimmers of hope on the horizon. Air transport taxation in Europe continues to rise. This is the case for in France and in the United Kingdom while Belgium and the Netherlands could soon follow suit.

Nevertheless, IATA is encouraged by lower taxes in Hungary and Italy and the abolition of passenger tax in Sweden. Germany could soon follow the Swedish example.

Performance and costs of airports and air navigation services

The costs of airport infrastructure and air navigation service providers (ANSPs) are also rising year on year.

But However, IATA notes little improvement in their performance. And to point out the imbalance between airlines and airports in terms of average return on capital invested. It amounts to to less than 7 % for airlines while some airports have very high returns on capital. Like Lisbon, with a return on capital of 21 %, Lyon with 15 % or Athens with 14 %. IATA believes that the rule at European airports is "heads I win, tails you lose" when it comes to the taxes charged to airlines.

When it comes to air navigation service charges, they have risen by 25% since 2019, 2 billion more. IATA perfunctorily notes that the number of movements fell by 0.3 million over the same period. And it points to higher-than-average service costs for air navigation services in Switzerland, Netherlands, France, Belgium and Germany.

In return, management results are often mediocre. IATA points out that the targets set by Eurocontrol for average flight delays have not been reached since 2013 - except during the Covid period. Added to this is a lack of airport capacity, accelerated by major delays in the development of existing or future hubs.

In this almost nightmarish assessment of European air transport, IATA unsurprisingly predicts that traffic growth on the continent will be the slowest in the world over the next 20 years. We expected no less from the association.