Airline Competition in Liberalized Markets: Effects on Thin Routes

There has been a general increase in competition in European airline markets since 2001, including competition on both direct and indirect connections. The success of several low-cost carriers on many short-haul routes, and the expansion of capacity at many large airports are a result of this increase in competition. In fact, many European airlines are having financial difficulties and many analysts suggest that a consolidation process is needed because there may be too many airlines playing an active role in European markets.