How Air France, Lufthansa, SAS, and British Airways Navigate Rising Airfares Across Europe Including in France, Germany, Norway, Denmark and UK in 2025: New Report You Need to Know – Travel And Tour World

As airfares rise across Europe, major airlines like Air France, Lufthansa, SAS, and British Airways are implementing strategies to navigate the evolving pricing landscape in 2025. According to the latest Air Monitor 2025 report by American Express Global Business Travel (Amex GBT), modest fare increases are expected across key European markets, including France, Germany, Norway, Denmark, and the UK. These airlines face a mix of challenges, from higher labor and fuel costs to shifting passenger demands and geopolitical pressures. Yet, they are also leveraging innovations like dynamic pricing, capacity adjustments, and enhanced passenger services to adapt to these changes. This new report dives into how these industry leaders are tackling rising airfares while reshaping the travel experience in one of the world’s most dynamic aviation markets.

The Air Monitor 2025 report from American Express Global Business Travel (Amex GBT) paints a detailed picture of airfare trends across Europe. The latest report predicts that airfares will see modest increases in 2025. Prices are stabilizing after the significant disruptions of recent years, continuing a trend that started in 2024. However, this stability comes with its complexities. Several factors, including supply and demand, advanced pricing strategies, and geopolitical challenges, are shaping the European air travel market in ways travelers and businesses cannot ignore.

Dynamic Pricing Reshapes the Airline Industry
Airlines are leaning more heavily into dynamic pricing, and this shift is redefining how they set their ticket prices. This approach lets carriers adjust fares in real time based on demand, competition, and even individual willingness to pay. Essentially, airlines are getting smarter—and more strategic—about how they price their tickets.

At the same time, the rise of New Distribution Capability (NDC) is adding another layer of complexity. This technology allows airlines to offer more personalized pricing and products directly to consumers and corporate travel buyers. While this may sound convenient, it’s complicating fare negotiations for companies trying to secure the best deals for their travelers.

Airfare Increases Within and Beyond Europe
If you’re planning to fly within Europe, expect to pay a bit more in 2025. Business class fares are projected to rise by 1.2 percent, and economy fares will likely go up by 2.8 percent.

For those traveling further afield, the price increases vary depending on the destination. Flights from Europe to North America will see business class fares rise by 1.5 percent and economy class by 0.8 percent. Heading to the Middle East? You’ll pay significantly more, with business class prices expected to jump by 6.8 percent and economy fares by 6.7 percent. Asia-bound travelers face even steeper increases, with business class fares climbing by 8.2 percent and economy fares rising by 6.6 percent.

France Focuses on Enhancements Amid Challenges
France is seeing both opportunities and challenges in its air travel market. Air France-KLM has adjusted its 2024 capacity forecast, aiming for a 4 percent year-on-year increase. The Paris Olympics, however, alongside rising labor and fuel costs and increased airport fees at Amsterdam Schiphol, are tempering this growth.

On the brighter side, Air France is working hard to improve the passenger experience. Starting in summer 2025, flyers will enjoy ultra-fast Starlink Wi-Fi, accessible through their Flying Blue loyalty accounts. Additionally, Air France is elevating its in-flight dining with menus crafted by Michelin-starred chefs on flights departing from Paris.

Corporate travel buyers should brace for higher costs, though. Air France-KLM’s delayed GDS surcharge will go into effect on January 1, 2025, likely increasing ticket prices for business travelers. The airline group is also taking steps toward sustainability by committing to purchase up to 1.5 million tons of sustainable aviation fuel (SAF) from Total Energies by 2035.

Germany Struggles with Growth and Rising Costs
In Germany, airlines are treading cautiously as economic growth slows. Lufthansa is adding more flights, but its overall capacity remains below 2019 levels. The airline cites supply chain issues and recent labor strikes as the main reasons for this cautious approach.

Domestic air travel demand remains strong, but limited competition means ticket prices could rise. Germany’s rail network, usually a strong alternative for business travelers, has been plagued by reliability problems, making air travel the more dependable option for many.

Lufthansa is also facing higher labor costs after agreeing to a 16.5 percent pay increase for cabin crew by the end of 2026. Adding to the cost pressures, the airline will introduce an Environmental Cost Surcharge in January 2025. This surcharge will range from €1 to €72 per ticket, depending on the route and fare.

Nordics See Changes and Rising Competition
The Nordic region, which includes Denmark, Norway, Sweden, Finland, and Iceland, has experienced significant developments in 2024. SAS, headquartered in Sweden and Denmark, has emerged from bankruptcy, joined the SkyTeam alliance, and welcomed Air France-KLM as a 19.9 percent stakeholder. These strategic moves are setting SAS on a stronger trajectory, with the possibility of closer collaboration with transatlantic partners like Delta and Virgin Atlantic.

SAS is also benefiting from strong demand, reporting load factors exceeding 87 percent in July 2024. However, the airline has introduced additional charges, such as a higher GDS surcharge and seat reservation fees for business class and premium economy passengers, which could mean higher costs for travelers.

In Norway, Norwegian Air’s acquisition of Widerøe, the country’s largest regional airline, is expected to increase competition in the Nordic market. This development has the potential to moderate ticket prices and provide more options for travelers across the region.

UK Airlines Navigate Challenges and Opportunities
In the UK, British Airways (BA) has had a tough year. The airline canceled hundreds of flights in late 2024 due to ongoing supply chain issues with Rolls-Royce Trent 1000 engines on its Boeing 787 fleet. Geopolitical factors, including the Russian airspace ban, along with rising fuel and labor costs, have added to BA’s challenges. These issues have led to reduced services to China and the suspension of one of its twice-daily flights to Hong Kong.

Despite these setbacks, the transatlantic market remains competitive. JetBlue, which started its Heathrow-to-JFK service in 2021, has expanded to serve six European destinations, including Dublin and Edinburgh.

Meanwhile, London City Airport, a favorite for corporate travelers thanks to its proximity to London’s business districts, is preparing for a significant expansion. The airport has won approval to increase its annual passenger capacity from 6.5 million to 9 million by 2031, promising even better access for business travelers.

Looking Ahead: Preparing for 2025
The Air Monitor 2025 report makes it clear that airfare pricing in Europe is entering a new phase of complexity. While the increases in ticket prices may seem modest, the factors driving these changes—dynamic pricing, shifting airline strategies, and geopolitical influences—are anything but simple.

For corporate travel buyers and individual travelers alike, staying ahead of these changes will be crucial. By understanding the forces at play and adapting to new pricing models, businesses and travelers can navigate the challenges of 2025 while making the most of the opportunities it brings.