Germany's Coalition Cuts Costs for Aviation Industry

Germany's coalition government has agreed to tax cuts and more efficient security checks to reduce airline costs. This move is intended to help the German aviation sector compete with European rivals, which have been operating at a disadvantage due to high costs.

In a strategic move to bolster Germany's aviation sector, the nation's governing coalition, led by Chancellor Friedrich Merz, has agreed on measures to reduce costs for airlines. These include tax cuts and enhanced security check efficiencies, aiming to alleviate the financial pressure faced by airlines.

High operational costs in Germany have long been a point of contention for the aviation industry, with low-cost carriers like Ryanair and EasyJet reducing flights due to competitive disadvantages. Despite a 3% passenger increase in the EU, German numbers remain significantly lower post-pandemic.

The coalition aims to save 350 million euros through rolled-back ticket taxes and reduced air traffic control fees. Industry leaders welcome the changes, viewing them as a critical step toward making flight operations in Germany more financially viable. Lufthansa shares responded positively, rising by about 2.5% following the announcement.

(With inputs from agencies.)