Planning a trip to Germany this year? Good luck with that

Planning a trip to Germany this year? Good luck finding an affordable flight. Unlike much of the rest of Europe, where flying has fully recovered to pre-pandemic levels, air traffic is still only around 85% of the 2019 total. The gaping hole in Germany’s flight schedule looks increasingly untenable.

After criticizing the country’s defunct three-party coalition for jacking up aviation taxes and fees, airlines are reducing services, and shifting aircraft to more profitable locations.

An imbalance of supply and demand has helped push up domestic air fares and sowed fears that Germans’ annual summer pilgrimage to the Mediterranean will become unaffordable for some.


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Those worried about climate change (like me) might instinctively welcome these developments: Aviation is a major polluter, and any shift to cleaner rail services is welcome. However, a loss of tourists and international air connections risks exacerbating Germany’s economic malaise.

Following February’s federal elections, the next government thus faces the unenviable task of ensuring airlines pay their fair share and reduce planet-heating emissions, while preventing Europe’s biggest economy from becoming an “aviation graveyard,” which is how Ryanair Holdings Plc’s perennially outspoken boss Michael O’Leary recently characterized the German market.

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Lately, frequent fliers to and from Germany have faced a jet stream of bad news. In October, Ryanair confirmed a 12% cut in German capacity for the coming summer, entirely exiting Dortmund, Dresden and Leipzig along with a 60% reduction in Hamburg and 20% in Berlin.

The same month, Deutsche Lufthansa AG’s low-cost arm Eurowings said it would axe more than 1,000 flights serving Hamburg and warned further cuts may follow and air fares would inevitably rise.

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They already have: In the first nine months of 2024, the cost of an economy flight in Germany was around 60% more expensive on average compared to 2019, notes Deutsche Bank AG’s research arm.

The shortfall in flying isn’t homogenous. Intercontinental flights have fully recovered, according to the German Aviation Association (BDL), whereas domestic air capacity is only at half of the level of 2019 (and excluding the large Frankfurt and Munich hubs, the domestic recovery is even weaker.)
The latter is partly an encouraging development: While Germany’s creaking railways need more investment, they should be the default option for domestic travel, and I’m glad companies are increasingly urging workers to take the train rather than fly.

However, a continuing deficit of flight connections between Germany and other European cities is concerning: Zoom calls and rail journeys aren’t always practical substitutes for this so-called point-to-point travel. (I was pleased to see the launch of a daily train service directly connecting Berlin and Paris in December, but the eight-hour journey feels impractical for a short business trip.)

As I was reminded recently when exploring the demise of the Berlin’s internationally renowned club scene, the loss of overseas visitors can have devastating consequences for businesses.

Until recently, it was the airlines, not governments, that were strapped for cash: In 2020, Lufthansa was forced to ask the German government for a €9 billion ($9.3 billion) bailout. (The money was subsequently repaid.)

But there’s no question who has the upper hand now. Boeing Co.’s production difficulties and the engine troubles affecting Airbus SE jets mean airlines can be choosier about where they deploy planes. They needn’t fear competitors will rush to fill any gaps and are better able to pressure governments and airports to cut them a good deal.

Higher taxes and levies certainly aren’t the only financial burdens the aviation world is facing: Lufthansa’s unionized workers last year secured bumper pay increases, for example.

But as airlines look around Europe, Germany appears particularly unattractive from a tax perspective. In May, the government hiked a levy on air tickets by around one-fifth to between just over €15 and almost €71 per ticket, depending on the route.
From this year, the maximum fee for airport security is set to rise from €10 to €15 per passenger, while air-traffic controller levies are also set to increase. A BDL analysis found the total financial burden of state taxes and levies for a medium-haul flight departing Germany is around 4,500 euros compared to around 660 euros in Spain.

Germany isn’t alone in hiking aviation levies — in November Britain’s Labour government announced air passenger duties for short-haul economy flights will increase by £2 ($2.50) per passenger from 2026, with a 50% hike for large private jets.

But other green pioneers are having second thoughts: In September, Sweden — which coined the environmental term “flight shame” — said it would scrap from mid-2025 a tax on air tickets introduced in 2018. (It’s probably no coincidence that until then Sweden’s post-pandemic aviation recovery had been even weaker than Germany’s.) Ryanair responded to the tax cut by increasing flights to and from Sweden.

To be clear, I think airlines and their customers should pay a decent amount of tax: A small proportion of wealthy people do much of the flying and commercial aircraft are a big contributor to climate change, accounting for around 4% of the European Union’s greenhouse gas emissions.

Regrettably, jet fuel isn’t taxed, for example, while international air tickets are generally exempt from value-added taxes, as is the case in Germany.

The good news is that from 2026, 100% of aviation emissions within the EU will be subject to a carbon price under the bloc’s emissions-trading system.

But in the current supply-constrained environment, imposing unilateral national measures is asking for trouble: Germany’s stipulations on airlines using sustainable jet fuel (SAF) are more stringent than the EU’s, for instance. When one country moves more aggressively than another, airlines will be tempted to shift planes elsewhere.

To prevent a race to the bottom, governments should therefore ensure national policies are closely aligned. Furthermore, revenue from aviation taxes should also be used to help the sector decarbonize.

(Due to its budgetary woes, caused by an unnecessarily restrictive debt brake, Germany ended up cutting SAF subsidies last year, undermining its own climate goals.)

Germany’s likely next chancellor, Friedrich Merz of the conservative Christian Democratic Union, is clear-eyed about the burgeoning threats to the country’s economic competitiveness; he’s also a private pilot. So I’m not surprised the CDU wants to cut the aviation sector some slack.

The solution isn’t to return to an era of when flights were priced the same as a cinema ticket. But nor is it sensible for an economically vulnerable export nation to cut itself off from the world.