Posted on April - 25 - 2010
Air fares to rise after ash cloud crisis
The ash cloud crisis and soaring oil prices are likely to mean a 5.2 per cent rise in air fares this year, according to new figures.
And fares could go up by a further 11.5 per cent in 2011, said the report by the Centre for Economics and Business Research produced for e-commerce company Kelkoo.
It put the cost to airlines of the ash-induced northern European airports’ shutdown at around £1.3bn by the end of last week.
The report said that it was reckoned that up to two-thirds of the cost of the volcano crisis would be borne by the European airlines, having a significant impact on their profitability this year.
They are expected to raise fares to offset the impact on profit margins by passing on rising costs to passengers.
Meanwhile, a survey by hotel price comparison site trivago.co.uk showed that overnight accommodation rates across Europe rose sharply during the ash cloud crisis.
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