What Does British Exit From the EU Mean for Airlines?
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Thursday’s historic vote by the British to have England exit the European Union — a movement known as "Brexit" — will certainly have wide-ranging implications for almost every aspect of society, just as it did when England and the rest of Europe first formed the EU.
That includes airlines.
Several issues have already surfaced that are sure to leap to the forefront. England isn’t leaving immediately, of course. Like anything, these things take time. Some estimates have the exit pegged at two years, minimum.
Still, there are legitimate concerns about the future of the airline and aviation industry in Great Britain — many of them directly affecting consumers and travelers — that certainly engender discussion now.
For one, new aviation agreements will most likely need to be negotiated between British-based airlines and European nations, leading many to wonder what will come of the low-budget carriers like EasyJet. Right now, no-frills airlines operate just like the major carriers thanks to the removal of old restrictions when the EU was formed.
EasyJet, Ryanair and the rest of the no-frills airlines have been able to take advantage of the ability to fly freely through Europe and create new routes almost at will, offering more choice for travelers and competition in fares. It will be interesting to see if the low-cost carriers will continue to enjoy that freedom from both ends of the spectrum — that is, will the major players in European aviation, like a Lufthansa for example, balk now at allowing an EasyJet to continue to operate in and out of Germany or will it lobby its own government for stricter restrictions and higher fees, especially since Lufthansa has its own low-budget subsidiary in Germanwings?
All of that could potentially filter down to the customer in terms of ticket prices if airlines are forced to pay higher fees just for flying into and out of EU nations.
The European Common Aviation Area (ECAA) will play a huge role in this. Norway, for instance, is not part of the European Union, but its Norwegian Air Shuttle is afforded the same kind of open-market protection and freedoms in airline travel that current EU members enjoy by being part of the ECAA.
But, whether the ECAA grants the UK membership remains to be seen, which could leave Great Britain and its airlines at the mercy of negotiating individual bi-lateral agreements with every European nation — not an easy task.
“The issue of the rise of air fares is a difficult one to predict,” Frank Brehany of travel website HolidayTravelWatch told The Telegraph newspaper. “If a British airline is operating in Europe, they may face a ‘fee’ imposed on them to operate which would then transmit into the cost of the ticket — I suspect that they would also face a greater litigation threat from disgruntled passengers seeking to capture some of their old rights. One thing is clear, this does not import any kind of certainty for consumers, let alone the airlines.”
Indeed, right now citizens of European Union nations enjoy some of the best compensation rules in the world when it comes to delayed and canceled flights. With Great Britain out of the EU, you can bet British Airways and Virgin Atlantic and Thomas Cook and the rest of the UK-based airlines will most certainly lobby to renegotiate those rules.
Even if all were to go smoothly with new flight agreements among airlines and nations, a big concern for the airlines is also money — as in, will English citizens have enough of it for holiday travel depending on how the British pound will fare against the euro once England leaves the EU.
The creation of the European Union in the 1990s following Germany’s reunification has been praised and criticized for two decades now. But one of the great beneficiaries of the EU has been a common market for airlines.
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