EU climate rules requiring European airlines to use ever-increasing amounts of expensive sustainable fuel (SAF) will undermine carriers' ability to compete on routes from Europe to Asia, the Financial Times (FT) reported, citing Air France-KLM CEO Benjamin Smith.
„European airlines are largely vulnerable to competition due to Europe's reluctance to address persistent market imbalances, Smith said. “This imbalance not only threatens our climate ambitions, but also threatens the competitiveness of European aviation“, he added.
He said Air France-KLM would be forced to cut almost half of its flights to Asia if Brussels did not ease climate policies that put the industry at a “significant disadvantage“ compared to its competitors. Only 8 out of 13 Asian routes will become unprofitable in the next 10 years,” the airline predicted.
Air France-KLM has already stopped flying five routes to Asia since 2015 due to rising costs that Gulf rivals do not face. British Airways and Lufthansa have also reduced services on Asian routes. European airlines have lost market share on this route to competitors such as Emirates, Qatar Airways and Turkish Airlines, which serve passengers via central hubs in Dubai, Doha and Istanbul.
According to the EU's program for reducing carbon emissions in the aviation industry, community airlines are obliged to add 2% SAF to their fuel from January 1, 2025. In 2030, its share should increase to 6%, and by 2035 - to 20%.