Lufthansa to raise fares by up to €72 as environmental costs increase
Lufthansa will add an environmental charge of up to 72 euros ($77) to its fares, the airline group said on Tuesday, joining at least one European rival in doing so as the industry battles to cover the cost of new EU rules on reducing emissions.
Ticket prices have already surged in recent years in the post-COVID travel boom, raising fears that further increases could start deterring travellers from flying.
Fares will go up between 1 euro and 72 euros, depending on the type of ticket, on all flights departing from European Union countries, Britain, Norway and Switzerland, the German airline group said. Some of the increases are effective from June 26 for departures starting from Jan. 1, 2025 onwards.
It said the charge would “cover part of the steadily rising additional costs due to regulatory environmental requirements” such as sustainable aviation fuel (SAF) made from bio-based materials – considered crucial to making flying less polluting.
Lufthansa shares hit an intraday low after the news but recovered later.
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European regulators introduced rules that ask fuel suppliers to ensure 2% of fuel at EU airports is SAF by 2025, rising to 6% in 2030 and 70% in 2050, with many arguing these measures will increase costs for the sector.
“I think it is logical to assume that other airlines will follow Lufthansa’s lead as it looks to pass on the increasing cost of environmental regulations in the EU,” said Dudley Shanley, an analyst at Goodbody.
“We have a SAF contribution in place, applicable to all flights (not only on departure from Europe) to transparently reflect the additional cost of incorporating sustainable aviation fuel,” an Air France-KLM spokesperson said in an emailed statement.
British carrier easyJet which has focused much of its environmental strategy on carbon reductions using hydrogen technology, said it wasn’t planning to follow Lufthansa’s footsteps.
“We don’t apply legacy carrier surcharges and have no plans to do so,” an easyJet spokesperson told Reuters.
Wizz Air also said it would avoid additional surcharges, adding in a statement that “to avoid burdening passengers with higher costs we urge governments to provide incentives to enable the aviation industry to achieve its environmental goals more effectively.”