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Austria blocks the Ryanair ticket-dumping

For the Austrian government an air flight cannot cost less than EUR 40

The new minimum price for tickets to and from Austria will be of € 40. This restriction is part of a new piece of legislation intended to prevent dumping on the prices of airline tickets by low-cost carriers, which often sell tickets at a cost even lower than cost of government taxes.

The Austrian government has also decided to implement, in addition, an airport tax of €12 with the aim of encouraging regional rail transport and gradually decreasing the use of the aircraft for short journeys. The idea is that these tax measures will help to guarantee better jobs, promote more sustainable air traffic and improve environmental protection measures.

In July 2019, Carsten Spohr, the president of Lufthansa, the parent company of Austrian Airlines, declared that ticket prices for European low-cost carriers are "economically, ecologically and politically irresponsible".

The criticism is that this type of reforms could cut airlines that base their business model and their earnings on ancillary revenues and not on the ticket price.

And while in Austria radical measures are launched to eliminate unfair competition and are used to help the sustainability of the Austrian' territories, making rail travel more attractive, in Italy low-cost companies are the masters and are currently trying to tilt the State, even through their institutions.

"Whenever we seem to be making a deal, in reality we are buying something of lower quality and added value, in a spiral that drags down the whole economy" said Pier Luigi del Viscovo, the director of the Experimental Institute of Marketing and the Fleet & Mobility Study Center, consultant to the European Commission on retail trade since 2013, in his book "Why low cost makes us poorer - Less quality and less ambition".

In his thesis, low-cost generates poverty that restrains development and teaches us not to be able to perceive quality anymore and its proposal is to go from low-cost to the right price, a bit like Austria will make now with the price of airline tickets.

If low-cost can therefore appear advantageous in the immediate term, according to the thesis of the consultant of the European Commission, in reality it causes damage to the general economy and creates long-term poverty. It is also a matter of consumer awareness and trust between the producer and the recipient of objects and services.

The Organization for Economic Cooperation and Development (OECD) has repeatedly compared the political experiences, commercial practices and coordination of local and international policies of the Countries of the European Union and when it came to comparing Austria and Italy it has been found that in general, Austrians are more satisfied with their lives than the OECD average, with 85% of people claiming to have more positive experiences in one day (feeling rested, feeling fulfilled, having fun) compared to the negative ones (pain, worry, sadness, boredom). The Italians, on the other hand, only reached 69%, a figure that goes 11 points below the European average.

One might think that it is the fault of low-cost airlines.

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AVIONEWS - World Aeronautical Press Agency
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