ABSTRACT
Low cost scheduled airlines have revolutionised short haul air travel in many parts of the world. By comparison with other regions of the world, Europe is unusual in that such a large proportion of its passenger traffic is carried on charter flights. In Germany, Europe's other large charter market, vertical integration has been a much more recent phenomenon. The move towards merging German tour operating companies with local airlines and travel agency chains followed moves by Airtours and Thomson to acquire tour operators in other European countries. Experiencing financial difficulties during the recession at the beginning of the 1990s, the Ryanair airline reinvented itself as a no-frills, low cost airline closely emulating the Southwest philosophy. The chapter examines the penetration of no-frills carriers on one of Europe's busiest business routes, London - Frankfurt. Charter however, continues to dominate on one of the largest holiday routes, namely London - Palma.
