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Geoforum 39 (2008) 1439–1451

Low-cost airlines in Europe: Reconciling liberalizationand sustainability

Brian Graham a,*, Jon Shaw b

a School of Environmental Sciences, University of Ulster, Cromore Road, Coleraine, Northern Ireland BT52 1SA, UKb Centre for Sustainable Transport and School of Geography, University of Plymouth, Drake Circus, Plymouth PL4 8AA, UK

Received 26 March 2007; received in revised form 17 August 2007

Abstract

This paper addresses the contradictions inherent in the interconnections between air transport liberalization and the economic andenvironmental dimensions to sustainability from the particular perspective of the dynamic expansion of European low-cost carriersand their networks. The argument considers the incompatibility of environmental sustainability with a business model that promotesrapid growth in air travel without meeting its external costs, but, simultaneously, claims to be socially and geographically inclusive.Moreover, that growth is perceived to be advantageous to strategies promoting national and regional economic growth and, conse-quently, the provision of low-cost airline services is being promoted by an array of national and local government agencies throughoutthe European Union. The paper concludes that the low-cost model does not account for its externalities despite air transport being themost environmentally damaging form of transport per passenger-kilometer but is clearly important to economic development at a varietyof scales.� 2008 Elsevier Ltd. All rights reserved.

Keywords: Air transport; European Union; Low-cost carriers; Economic development; Environmental sustainability

1. Introduction

The primary aim of this paper is to discuss the con-tradictions inherent in the relationships between air trans-port and sustainability from the particular perspective ofthe dynamic expansion of European low-cost carriers(LCCs) and their route systems. The qualitative argumentis structured as a series of overlapping networks of concep-tual interconnections that link liberalization, social andeconomic development, and the environment. As Keeling(2007, p. 219) argues, ‘‘transportation geography mustmove beyond the strictly utilitarian or orthodox and chal-lenge the very essence of the social processes that take placein myriad spatial milieus”. The conflicting priorities thatemanate from these three policy arenas mean that the var-

0016-7185/$ - see front matter � 2008 Elsevier Ltd. All rights reserved.

doi:10.1016/j.geoforum.2007.12.006

* Corresponding author.E-mail addresses: bj.graham@ulster.ac.uk (B. Graham), jon.shaw@

plymouth.ac.uk (J. Shaw).

ious sets of interconnections produce contradictions andtensions that are not easily reconciled. We address, forexample, the incompatibility of environmental sustainabil-ity with a business model that promotes rapid growth in airtravel without meeting its external costs, but, simulta-neously, claims to be socially and geographically inclusive.Moreover, that growth is perceived to be advantageous tostrategies promoting national and regional economicgrowth and, consequently, the provision of LCC servicesis being supported by an array of national and local gov-ernment agencies throughout the European Union (EU).The Lisbon Agenda of 2000 (reaffirmed in 2005) committedthe Union to becoming the most dynamic and competitiveknowledge-based economy in the world by 2010, an ambi-tious goal that also seeks to reconcile economic, social andenvironmental renewal. The Lisbon Agenda also reiteratedthe long-standing commitment to cohesion and investmentin competitiveness factors so that Member Statesand regions can overcome structural problems and

1 A variety of terms are used to describe ‘‘traditional” carriers. Theseinclude: ‘‘network”; ‘‘legacy”; ‘‘mainline”; and ‘‘full service”. Here we use‘‘network”, alluding to the hub-and-spoke configuration of their routesystems.

1440 B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451

peripherality. The transport network is one of those com-petitiveness factors (European Commission, 2004a), evenif the 2001 EU White Paper on Transport paid scant atten-tion to air transportation (AEA, 2006).

Sustainability comprises a contested mixture of environ-mental, social and economic processes which militatesagainst the formulation of an agreed operational modelof the concept. This problem is particularly acute in trans-port, which clearly creates profound environmental exter-nalities but is, simultaneously, a key factor in economicand social development at a variety of scales (Black andNijkamp ed., 2002). Black (1996, p. 151) regards sustain-able transport as ‘‘satisfying current transport and mobilityneeds without compromising the ability of future genera-tions to meet these needs”, a definition that conflates envi-ronmental objectives with economic and social goals. Areport produced for Airports Council International Europe(ACI Europe) (York Aviation, 2004) draws upon UnitedKingdom (UK) government data to define sustainabilityas comprising: the maintenance of high and stable levelsof employment; social progress which recognizes the needsof everyone; effective protection of the environment; andprudent use of natural resources. This conceptual fragilityof sustainability, which clearly emerges from the attemptto conceptualize it as a holistic framework, is readily dem-onstrated by its relationship with air transport. Air trans-port’s principal external costs are not ‘‘damage” as suchbut ‘‘costs unaccounted for” (Wit et al., 2002, p. 13), espe-cially from noise and atmospheric emissions. These are notinternalized and are ‘‘thus excessive in terms of what mightbe anticipated if a sustainable environment is to beattained” (Button, 2001, p. 70).

Yet aviation also delivers social and economic goods(Upham et al., 2003a,b). It offers direct employment, cata-lytic spin-offs, contributes to trade and tourism, and is asignificant tax-payer (ATAG, 2005). It is estimated thatevery 1 million air passengers support almost 6500 peoplein air travel related work, including direct, indirect,induced and catalytic effects (York Aviation, 2004). Areport by Oxford Economic Forecasting (OEF, 2006) cal-culates that in the UK, aviation contributed 1.0% of theoverall economy in 2004, directly employed 186,000 peopleand supported, in total, 520,000 jobs.

The paper addresses three overlapping networks ofrelationships. In the first, liberalization, we focus on theemergence of LCCs as the principal repercussion of thederegulation of the European air transport market.Secondly, the paper turns to the interrelationships betweenliberalization and the socio-economic dimensions of sus-tainable development. These involve not only issues suchas the competitiveness factors identified by the EU but alsobehavioural changes related to mobility. Thirdly, we con-sider the complex interconnections between liberalization,socio-economic development and the environmentaldimensions to sustainability. The paper concludes with asummary of the principal conflicts and tensions thatemerge from the analysis and addresses their implications

for the sustainability debate. We draw heavily on the UKexperience because of the volume of research carried outin advance of, and as a consequence of, the 2003 AviationWhite Paper (DfT, 2003, 2006; Graham, 2003). Again,while the focus is firmly on LCCs, the networks of relation-ships discussed in the paper relate to all airlines. The keypoint, however, is that the escalating desire and propensityto fly is being driven by the growing affordability of air tra-vel that stems from increased disposable income but isfacilitated, crucially, by the growth of LCCs and theirimpact on the marketing practices of the ‘‘traditional” net-work airlines such as British Airways and Lufthansa.1

2. Liberalization

2.1. The emergence of LCCs

The liberalization of the EU air transport industry wasgradually implemented through three successive stages oflegislation between 1988 and 1997. Effective April 1997,all EU airlines had open access to virtually all routes withinthe 15 Member States (followed by Iceland, Norway andSwitzerland in 1998). The only exceptions have been pub-lic-service obligation (PSO) routes serving remote regions,cities and islands which are awarded by competitive tender.The subsequent enlargements of the Union in 2004 and2007 have added a further 12 states, largely in Centraland Eastern Europe, to the single aviation market.

First in North America, then in the EU and, now, else-where in the world, the dramatic growth of LCCs has beenthe most important outcome of liberalization (Lawton,2002; Francis et al., 2006). The low-cost model was pio-neered by Southwest Airlines in the United States andhas been widely emulated by other North American, Euro-pean and now Australasian carriers (Graham and Goetz,2008). In exploiting the derived demand for air transportby selling mobility at low cost, the LCCs are promotingbehavioural changes in leisure and business travel patterns.The definition of an European LCC is rather ambiguous,the sector includes airlines ranging from the Irish nationalcarrier, Aer Lingus, (which has transformed itself into a‘‘superior” LCC) through former charter airlines such asAir Berlin which have now entered the scheduled market,to the dedicated low-cost operators such as the marketleaders, Ryanair and easyJet. All LCCs share a commit-ment to the ‘‘cult of cost reduction” (Lawton, 2003, p.175), a business model that offers low fares, strips out over-all costs and leverages assets – both human and material –to the full. As the model has evolved, ancillary sales(including: charges for luggage; on-board sales of foodand gifts; even ‘‘Scratch Cards”) have become more impor-

Table 2Key principles of the low-cost carrier model

� High-capacity seating� Minimum legal crew� Cabin service only at additional cost� Fast turn-rounds� On-board air stairs instead of airport air bridges� Operating procedures to minimize take-off thrust and braking on

landing, congruent with runway length� Point-to-point traffic only� No freight� Advantageous rates from airport operators� Generally sectors of less than 2 h to maximize aircraft utilization� Online booking to eradicate travel agent commission� Supplements for payment by credit card� Sophisticated websites with extensive information on destinations� One-size and type fleets (although some LCCs have compromised

on this point)

Source: Graham and Vowles (2006).

B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451 1441

tant. For example, in 2005–2006, €259m of Ryanair’s€302m net profit came from ancillary sales (AEA, 2006).

Especially since 2001, the European low-cost sector hasattracted a bewildering number of new entrants; it isestimated that about 50 LCCs were operating in 2005(Table 1). Capitalizing on their ‘‘first-mover” advantage(Francis et al., 2006), Ryanair and easyJet carried 42.5mand 28.0m passengers, respectively in 2006, placing bothin the world’s top 20 airlines by this measure. In roundterms, LCCs accounted for about 20% of all Europeanair traffic in 2005, although this rises to about 50% the Brit-ish Isles–continental Europe market, while the sector’sgrowth rate is much greater than that of the network carri-ers. Ryanair and easyJet had 31% and 26%, respectively, ofLCC seats in the summer of 2006 (AEA, 2006).

In addition to maximizing the use of assets, Doganis(2001) identifies three other critical areas in cost reduction.First, labour unit costs (which account for between 25%and 35% of total costs) have to be contained and the pro-ductivity of that labour increased. Secondly, airlines them-selves have to implement e-commerce sales, ticketing anddistribution (15–20% of total costs). Finally, costs can befurther reduced through operational and service changesincluding: reductions in cabin service (and staff); outsourc-ing of maintenance and ground handling; single-aircrafttype; and enhanced aircraft utilization. Doganis estimatesthat a LCC can operate sustainably at 40–50% of the unitcost of the average network carrier. Overall, LCCs haveunit costs up to 60% lower than network carriers achieved

Table 1Some leading European low-cost carriers, 2006

LCC Homecountry

RPK(million)a

Passengers carried(million)

Ryanair Ireland 40,118 42.5EasyJet UK 27,608 28.0Air Berlin Germany 24,450 19.7Thomsonflyb UK 24,019 9.6Monarchb UK 14,642 5.8Aer Lingus Ireland 13,363 8.6Transavia Netherlands 10,397 5.1Germanwings Germany 5956 7.1Norwegian Norway 4223 5.1Jet2.com UK 3740 2.8Bmibaby UK 3499 4.1Hapag-Lloyd

expressGermany 3489 4.6

Vueling Spain 3253 3.5Flyglobespan.com UK 3028 1.3SkyEurope Slovakia 2801 2.6Flybe UK 2500 4.5

Comparator network carriers

British Airways UK 112,851 33.1Lufthansa Germany 110,330 53.4Iberia Spain 52,493 27.8

Source: Airline Business, August (2007).a Revenue passenger-kilometers (reflects intensity of network but also

sector length).b Charter carriers also operating low-cost services.

through a set of now relatively standardized operatingpractices (Table 2).

The liberalization of EU aviation has realized the poten-tial for direct non-stop air routes on city-pairs formerlyserved by connecting services through hubs while the pro-vision of new services has unlocked the latent demand frompassengers wanting to travel from local airports (CAA,2005).2 One obvious service differential, however, is the air-port served. Ryanair often uses secondary airports locatedat some distance (100 km and no less than 120 km, respec-tively, in the cases of Frankfurt Hahn and Oslo Torp) fromthe cities they purport to serve. These are clearly very pricesensitive services, consumers trading-off low air pricesagainst convenience and, almost certainly, an inaccuratecosting of additional ground travel. (Nor are the terrestrialtransport costs incurred generally included in calculationsof the environmental externalities of air transport.) In con-trast, Ryanair’s rivals such as easyJet and bmibaby gener-ally use the principal airports serving each of theirdestination cities (slot availability permitting). Given achoice, however, there is very little evidence to suggest thatpassengers are prepared to pay a price premium for addi-tional service features such as more accessible but expen-sive airports which, moreover, increase airline costs.Alamdari and Fagan (2005, p. 391) argue that adherenceto an ‘‘original” Southwest model based on cost leadership,‘‘could potentially ensure greater profitability”, althoughthey recognize that LCCs have to fine-tune the model tospecific market conditions (not least being the need toappeal to business as well as leisure travellers). Estimatessuggest Ryanair can make a profit with a 55% load factor

2 ‘‘City-pair” refers to a particular inter-urban connection, for examMilan–Paris. As major cities may be served by more than one airporcity-pair can be distinguished from an ‘‘airport-pair”, for example, MiLinate–Paris Charles de Gaulle.

ple,t, alan

1442 B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451

whereas easyJet (with its higher costs) requires 75% (Bing-geli and Pompeo, 2002).3

While not all LCCs will survive, their sheer number isindicative of the problem facing the network carriers whichhave been forced to refocus their operations in terms ofcosts and yields.4 There has been a step-change in the nat-ure of the liberalized airline industry since c.19905: ‘‘Costreduction is no longer a short-term response to decliningyields or falling load factors. It is a continued and perma-nent requirement if airlines are to be profitable” (Doganis,2001, p. 222). The network carriers have sought to reducelabour costs (through layoffs, wage and benefit cutbacks,and shedding pension benefit plans), lower their own faresfor point-to-point services, reduce the standard of cabinservice, and promote electronic booking on the Internet.Some have even established their own low-cost ‘‘carrier-within-carrier” subsidiaries, albeit at the risk of cannibaliz-ing their own traffic (Graham and Vowles, 2006).

One important study (CAA, 2006) has challenged sev-eral common assumptions concerning LCCs. Despite theirrapid development, it found little evidence that, in aggre-gate terms, LCCs have ‘‘significantly affected overall ratesof traffic growth” which have remained fairly constant at5–6% per annum since the mid-1990s (CAA, 2006, p. 3).Individual airports may show very high percentageincreases in traffic (often from low bases) but, overall,LCC growth has been at the expense of the network carri-ers and, even more so, of the charter airlines. Thus the keystep-change is not growth per se but the availability of lowand unrestricted fares, release of latent demand at regionalairports and a very considerable increase in choice of des-tinations and airports.

2.2. Market segmentation

While market segmentation has always been a feature ofair transport since it became a mass-market product at theend of the 1950s, LCCs are changing both business and lei-sure travel behaviour patterns. Nevertheless, as with net-work carriers, which operate with an approximate 30/70% split between business and leisure traffic, LCCs alsodepend on the same mix of travellers’ motives. For exam-ple, easyJet calculates that about 25% of its passengersare travelling on business while OEF (1999) estimated asimilar percentage which would remain constant into thefuture. Mason (2000) has demonstrated that price is themost important purchase factor for companies and thattravel by LCCs is especially attractive to small and mediumenterprises (SMEs) although many business travellers have

3 Load factor is the percentage of aircraft seats occupied on a singleflight.

4 Yield is the average revenue produced by each passenger-kilometre ortonne km carried.

5 In this context, a ‘‘step-change” can be defined as a radical transfor-mation that leads to a dramatic shift in airline business and/or operatingstrategies.

no alternative but to use such airlines, given the decliningshare of network carriers in the market-place. Nevertheless,they may have benefited more than leisure travellers fromlower fares, which is especially important to SMEs, partic-ularly in the regions (CAA, 2006). However, to date, mostLCCs do not allow inter-lining or even intra-lining connec-tions so they do not confer the connectivity benefits whichthe business market often requires (Sørensen and Dukes,2005).6

Although it is claimed that LCCs are promoting socialinclusion in allowing more people to fly, the CAA (2006)found no real ‘‘democratization” effect, there being littleevidence of any major change, especially in the leisure mar-ket, in the type of people flying compared to the mid-1990s.While this conclusion challenges popular perceptions (andeven ‘‘empirical experience”) of low-cost air travel anddespite the significant increase in the total number of peo-ple flying, it is the middle and higher-income socio-eco-nomic groups who are ‘‘flying more often than in thepast, and often on shorter trips” (CAA, 2006, p. 5). TheLCCs are instrumental in the further development of week-end, city or short-break tourism and in effecting a radicalexpansion of potential destinations. Using their highly effi-cient Internet sites and yield management systems, they areextending the range of motivations and frequency of travelfor private leisure reasons and targeting an eclectic range ofoverlapping niche markets, ranging from cultural tourismthrough the second-home market, pensioners winteringabroad to ‘‘stag” and ‘‘hen” parties. Some of this trafficmay be less than desirable for the destination cities as wit-nessed by a succession of lurid press stories about thebehaviour of British travellers abroad.7 LCCs also servethe ‘‘visiting friends and relations” (VFR) market whilethe increasing number of destinations served, especially inCentral and Eastern Europe, also points to wider socio-economic changes promoted by EU enlargement. Obvi-ously, these are facilitating the movement of migrantlabour and the CAA (2006) found significant evidence thatinbound traffic to the UK has increased. Its study showsthat migration is followed by VFR traffic which is the fast-est-growing segment of inbound traffic at both Luton andStansted in recent years, accounting for almost 50% ofinbound trips.

2.3. Routes and networks

There are limitations to the routes served by LCC net-works as, ultimately, these have to respond to demand.Inevitably, therefore, the route maps of various operatorsshow a considerable duplication of the same city-pairsalthough they may often be served by different airport-pair-ings. Unlike the hub-and-spoke systems of the network car-

6 ‘‘Inter-lining” refers to checked connections between two or morecarriers, ‘‘intra-lining” to same-carrier connections.

7 See, for example, Jones (2006) and specialist websites such aswww.praguepissup.com.

B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451 1443

riers, the LCCs have opted for linear point-to-point net-works although these remain significantly concentratedbecause of their focus on base airports (Burghouwt et al.,2003; Burghouwt, 2005).8 Most services are operated ona point-to-point basis although Air Berlin’s networkincludes a hub-and-spoke operation centred on Palma deMallorca. Because LCCs often use secondary airports,there has been a marked increase in city-pairs served, ofteninvolving quite small provincial towns (Fan, 2006). Theemphasis on relatively short sector lengths also encouragesduplication by constraining the geography of LCC net-works and leading to a spatial concentration of their activ-ities. The key is to create networks which combine differenttypes of routes that are also compatible with the ‘‘one sizefits all” fleet philosophy. One intensive analysis of routenetworks clearly demonstrates their repetitive nature.Dobruszkes (2006, p. 255) points to the continued impor-tance of ‘‘national anchoring” and the paradox that whileLCCs are a product of liberalization, most are still ‘‘onlyweakly” using fifth to ninth freedom rights.9 This is chang-ing, however, as the market leaders such as Ryanair andeasyJet open more bases outside Ireland and the UK(Fig. 1). Three different categories of routes can be identi-fied although none of these is completely discrete.

First, UK domestic routes, which effectively includethose between Britain and the island of Ireland, form thebackbone of Ryanair and easyJet’s networks, the compli-cated geography of the ‘‘British archipelago” and road con-gestion combining with the infrastructural deficiencies andhigh ‘‘walk-up” fares of conventional rail.10 In Britain andIreland, LCCs already have more than 30% of the market(European Commission, 2005). Domestic services alsocomprise the core operations of German LCCs such as ger-manwings from Cologne–Bonn. As yet, LCC penetrationinto the domestic markets of other major EU countriessuch as Spain or Italy is less advanced although this is alsochanging quickly. In France, the train a grande vitesse

(TGV) network offers effective competition to LCCs interms of both time and cost, while access to slots at Parisairports, especially Orly, remains difficult. The Scandina-vian LCC record is very patchy, not least because of themarket power of the incumbent carrier, Scandinavian Air-lines; Norwegian, which operates services within Norway,another country with a complex physical geography anda high propensity to fly, is the only LCC with any domesticpresence.

Secondly, their offshore location confers further benefitsto UK-based LCCs which, in addition to services betweenBritain and the island of Ireland, are heavily dependent on

8 A ‘‘base airport” is one at which an airline bases aircraft and aircrewand, possibly, line engineering (LCCs usually outsource ground handlingand most maintenance).

9 Those that permit airlines to fly routes not originating or ending intheir home country.10 This term is used conventionally to refer to tickets bought for same-

day travel.

cross-water routes between the UK/Ireland and continen-tal Europe. While these serve a wide variety of destinations,the key markets are the principal Mediterranean city and‘‘sun” destinations, such as Venice, Nice, Barcelona,Malaga, Alicante and Faro, and winter ski destinations,most notably Geneva. The second-home market is espe-cially strong in France and Iberia and helps support, forexample, a number of routes between the UK and smallFrench regional airports such as Bergerac, Carcassonneand La Rochelle. North–south leisure-oriented routes fromScandinavia and Germany also serve the Mediterraneanlittoral and major inland tourism and leisure destinations.

Finally, west–east routes have grown significantly withthe 2004 and 2007 expansions of the EU. German-basedcarriers like Air Berlin are particularly well placed to cap-italize on this market, one reason why easyJet has estab-lished bases at Dortmund and Berlin Schonefeld. Inaddition, there has been a wave of start-up LCCs basedin the accession countries, including SkyEurope Airlinesat Bratislava and Wizz Air at Budapest and Katowice. Pra-gue, widely regarded as the ‘‘new Paris”,11 was alreadywell-served, partly because the Czech government hadallowed LCC access prior to 2004. Budapest, Krakow,Tallinn and Riga are among those cities being tipped asthe ‘‘new Pragues” on the back of the enlargement of theEU single aviation market.

3. Liberalization and socio-economic development

3.1. The economic benefits

Since the 1990s, EU regional development initiativeshave directed investment into transport and other infra-structure to stimulate economic growth and help attractinward investment into less advantaged regions (EuropeanCommission, 1996). The overall objective has been the cre-ation of a trans-European network (TEN) for transportand telecommunications which enhances accessibility andintegration while harmonizing national networks into amacro-network for the EU as a whole. The relationshipsbetween LCCs and enhanced accessibility (and, indeed, amarked contribution to the effective integration of Europe)nest within the wider interconnections between economicgrowth and the provision of transport infrastructure. Theevidence that good air links confer positive benefits tonational and regional development is relatively clear,although this is often overstated or exaggerated while itis also difficult to measure and spatially variable. Thisapplies both at the national and regional scales and reflectsboth multicollinearity of variables and also the problems ofestimating the net benefits realizable from inbound andoutbound air travel. Turning to the evidence collected inadvance of the 2003 Aviation White Paper (DfT, 2003),one major analysis of the contribution of aviation to the

11 ‘‘New” in the sense of being the key weekend break destination.

Fig. 1. The EU single aviation market (with Ryanair and easyJet bases (August 2007) and other places referred to in the text).

1444 B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451

UK’s economy, (OEF, 1999) emphasized factors such as itsroles in facilitating world trade, human networking,increased productivity and improved profitability for othereconomic sectors. While OEF was able to identify a linkagebetween transport infrastructure and the performance ofthe rest of the economy, its methodology failed to isolatean effect on productivity from aviation, separate from thatcaused by the transport infrastructure as a whole.

To facilitate projected growth, the White Paper recom-mended new runways at Heathrow and Stansted and majorinfrastructural improvements at many other UK regionalairports, a ‘‘predict and provide” commitment reiteratedin the 2006 ‘‘progress” report (DfT, 2006). The debate onairport expansion is often couched in terms of the ‘‘econ-omy versus the environment” (Hacan ClearSkies, 2003).More realistically, it can be accepted that the direction ofbenefit between air transport provision and regional eco-nomic development is relatively clear although these eco-nomic benefits are achieved at a considerable and as yetunquantified cost. While their case is refuted by OEF(2001), Grayling and Bishop (2001) argue that the linksbetween economic growth and aviation have been over-stated and are also highly dependent on location. The mostdetailed assessment of the aggregate impact of aviation onUK regional economies (OEF, 2002) demonstrated a veryvariable relationship that was most pronounced in theGreater South East. In addition to direct employment,OEF estimated that aviation creates 1.31 indirect jobs foreach direct job at all airports other than Heathrow andManchester. But because aviation is heavily subsidized

through tax exemptions – an estimated £7b per annum inthe UK alone – the cost to the tax-payer in creating avia-tion-related employment is higher than in many otherindustries.

In terms of the aggregate relationship between aviationand regional economies, OEF (1999, 2002) argues that atboth national and regional scales, the sectors most likelyto contribute to regional economic growth are typicallythose most dependent on aviation. With regard to trade,the most dynamic sectors in knowledge-based economiesare heavy users of air transport while foreign direct invest-ment (FDI) is ‘‘mainly concentrated in dynamic urbanareas” (European Commission, 2004b; York Aviation,2004). Again, improvements in transport infrastructurecan boost productivity growth across firms that can useit. However, all transport linkages work two ways and,for example, UK investments overseas between 1997 and2001 were almost twice incoming FDI (Hacan ClearSkies,2003). York Aviation (2004) also stresses the role of tour-ism which accounts for 5% of total employment and ofGDP in the EU, in addition to accounting for 30% of totalexternal trade in services. Crucially, however, again thesebenefits are not offset against losses from outbound tour-ism facilitated by air transport. Drawing on DfT statisticswhich show that UK residents will make a predicted88 m overseas visits by air in 2020, compared to 54 m visitsby foreign residents to the UK, the pressure group HacanClearSkies (2003) estimates that a total expenditure deficitto the UK of £11.1b plus £1.7b value-added tax (VAT) lossin 2001 will rise to £14.2b plus £2.1b VAT loss in 2020. It is

Fig. 2. The ‘virtuous’ cycle airport model (after CAA, 2005).

B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451 1445

estimated that 75% of inbound visitors to the UK arrive byair and contribute 1.1% of GDP and support 170,000 jobs.But ‘‘the flow of UK citizens in the other direction is evenmore substantial” (OEF, 2006, p. 27). Residents of the UKmade 66.5 m trips abroad in 2005, representing a 61%increase since 1995; two-thirds of these visits were for lei-sure reasons.

3.2. Airports and incentives to fly

While neither the OEF nor the York Aviation studiesdifferentiate between sectors within the air transport indus-try, the dynamic growth of LCCs enhances their signifi-cance to the relationship between regional developmentand air transport growth in the EU. Despite the often-over-stated evidence, regional development agencies and bothpublicly- and privately-owned airports perceive them asimportant drivers of growth and compete for their services.A daily Ryanair B737-800 schedule, for example, equatesto around 70,000 seats per annum each way. Paradoxically,the development of LCC networks has often been depen-dent on the existence of ample spare capacity at smaller air-ports, originally constructed or developed to enhance theaccessibility of their respective regions. Although it canbe argued that LCCs are therefore making more efficientuse of expensive airport capacity and reducing demand atalready congested hub airports, at an aggregate level theystill encourage the inadvertent provision of cheap mobility.The fastest-growing airports in Europe (albeit from lowbases) are those categorized by ACI Europe as Group 4,having fewer than 5 million passengers per annum andattracting low-cost traffic.12

More commercial and often privatized airports attemptto emulate the ‘‘virtuous cycle airport model” (CAA,2005), actively seeking additional carriers so that bothaeronautical but especially non-aeronautical revenuegrowth allows the cycle to continue (Fig. 2). The advan-tage, however, probably lies with the airlines because theirprincipal assets – aeroplanes – are mobile and can bedeployed to any one of a number of competing airportsand routes. Essentially, LCCs are seeking to negate other

12 ACI Europe classifies airports as follows: Group 1 – more than 25 mpassengers per annum; Group 2 – 10–25 m; Group 3 – 5–10 m; and Group4 – fewer than 5 m.

sunk costs incurred in setting up new routes by turning acentre of costs, airport charges, into potential profitsthrough airport marketing agreements and reduced or evennominal handling charges for aircraft and passengers. Theairlines are often negotiating highly advantageous terms,perhaps to the disadvantage of incumbent operators, whiledeficits incurred by regional airports, which cannot gener-ate sufficient income from landside activities to compensatefor these discounts, are probably being funded throughlocal taxation. In one case in 2006, a local Northern Irelandnewspaper, the Belfast Telegraph, used the Freedom ofInformation Act to force Derry City Council to reveal thatsince 1999, it had been paying Ryanair a guaranteed£250,000 per annum plus free landing, parking and naviga-tion facilities to operate a Derry–Stansted service. Inreturn, the airline paid £100 for each landing and take-off. The deal was suspended in 2005 under new EU guide-lines, having cost Derry ratepayers some £300,000, theremainder of the subsidy coming from tourism agenciesand Donegal County Council (BBC Northern Ireland,2006).13

In the past, various forms of aid were compatible withEU transport policy if such subsidies fostered the develop-ment and improved use of the secondary airport structurewhich may be underused and representing a cost to theCommunity as a whole (European Commission, 2001).Subsidies, however, can also distort competition and thiswas the basis of the Charleroi ruling of 3rd February2004 in which the European Commission found that underthe ‘‘prudent private investor criterion” Ryanair had beenreceiving subsidies tantamount to state aid from the air-port’s owner, the Walloon regional government (EuropeanCommission, 2004b; see, also, Barbot, 2006). Essentially,this means that no private operator would have grantedthe same advantages to the airline. The Commission thenallowed that some forms of aid were acceptable at state-owned airports including introductory discounts for upto 5 years and one-off help for marketing support for newroutes. Such benefits, however, had to be available to allcarriers wishing to enter a market. Ryanair’s deal on land-ing charges, promotion, route incentives, training and

13 Ryanair is the only scheduled operator at the airport, apart from atwice-daily PSO route to Dublin and a single service to GlasgowInternational flown by Loganair.

1446 B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451

ground handling at Charleroi was both exclusive and forno less than 15 years.

Prior to the Charleroi ruling, in 2003 Ryanair had lostanother case concerning its agreement on aid granted bycity and regional authorities in Strasbourg to the airline’sLondon Stansted–Strasbourg route which commenced in2002.14 The German LCCs, Air Berlin and GermaniaExpress (now merged with dba/Air Berlin), have also con-tested the agreements negotiated by Ryanair at Lubeck andeasyJet at Berlin Schonefeld on the grounds that the airportoperators are levying unequal handling charges. In 2006, aGerman court ruled that subsidies paid to Ryanair atLubeck were ‘‘unreasonable” (ATI, 2006). Subsequent tothe Charleroi ruling, the European Commission (2005)issued a detailed Memorandum on the financing of regio-nal airports and start-up support, which insisted on degres-sive aid, calculated per passenger and linked transparentlyto traffic statistics. These regulations were further refined in2006 and it was announced that discounted aeronauticalcharges were to be phased out by June 2007.

Until then, it was possible for regional administrationsto provide financial support for new air services, the keycriteria being that such aid did not discriminate againstany user and was granted for a limited period. In theUK, for example, the devolved administrations in Scot-land, Northern Ireland and Wales established air routedevelopment funds (RDFs). The very similar schemes pro-vided financial support at certain specified rates per depart-ing passenger for new routes up to a maximum of threeyears although this investment was in addition to, andnot a substitute for, the ‘‘normal” incentives provided byairports to attract new traffic. Before funding was offered,all proposed routes were subjected to economic appraisalswhich had to demonstrate a net economic benefit to theregion (derived from inbound business travel, tourismand direct/indirect/induced employment as well as out-bound business travel). By the beginning of 2007, the Scot-tish RDF, set up in 2002, had supported more than 50 newroutes of which 43 were still operational or planned (Air-port Business, 2007), while its Northern Ireland counter-part, Air Route Development (NI) Ltd., established in2003, had provided assistance for nine new services. Ofthese, only three were still operating in 2007 as agreedunder the original funding terms. Although both schemeshave supported services provided by a variety of types ofcarriers (including new Edinburgh and Belfast transatlanticroutes to Newark), LCCs – most notably Ryanair at Prest-wick and easyJet at Belfast International – have beenprominent beneficiaries. From June 2007, however, thefunding level was reduced to 30% and, thereafter, a compli-ant RDF was defined largely as marketing support. Start-up aid can be paid only for routes linking a regional airportin Category C or D to another EU airport, or exception-

14 The carrier was forced to withdraw the service, moving it across theGerman boundary to Baden–Baden.

ally, new routes from or to a Category B airport (EuropeanCommission, 2006).15 In the UK, the RDFs in Scotland,Northern Ireland and Wales will end as present commit-ments expire.

While the Scottish and Northern Ireland RDFs andother forms of marketing support seek to minimize the dis-benefits by funding only routes estimated to show a netbenefit in terms of regional development, the more generalproblem remains that low-cost flights allow both inboundand outbound traffic from a region. Any calculation ofthe net economic development of a service to a region orcity has to allow for the loss of expenditure incurredthrough outbound travel by the indigenous population.Again, given that travellers will apparently make long sur-face journeys to avail themselves of cheap flights, there is aproblem of retention of expenditure by inbound travellerswithin the hinterland of the airport. Regional authoritiesmay therefore be subsidizing passengers who simply imme-diately pass out of their particular region which under-mines the justification for discounts to carriers andinfrastructural development. It is important, therefore, toattract based aircraft and crews which creates jobs andgives a more secure return from the investment of publiccapital.

3.3. Mobilities

While the preceding discussion has been largely con-cerned with the physical manifestations of accessibilityand their interconnections with regional economic develop-ment, there remains the question of social inclusion and thequality of life, especially in remoter regions. It is ironic thatas the debate into the long-term sustainability of air trans-port gathers pace, some academics have embraced thealleged ‘‘mobility turn” in social sciences (see, for example,Urry, 2000). Mobility is a fundamental human activity andneed (Hoyle and Knowles, 1998) but, equally, a behav-ioural factor being promoted by changes in spatially dis-persed social networks and consumer practices (Donaghyet al., 2004; Cresswell, 2006) and, moreover, readily manip-ulated by price. Again, mobility is a derived demanddescribing the ability to move between activity sites.Despite the lack of convincing evidence of a ‘‘democratiza-tion” effect, the issues of liberalization and developmentintersect here with the question of mobility: ‘‘The wholeair transport deregulation process was aimed at grantingEU citizens the right to air mobility, lowering the cost ofair transport and extending it to a wider share of the pop-ulation” (Airline Business, 2005, p. 19). The idea that EUcitizenship includes the right to air mobility introducesanother dimension to the contradictions inherent in low-cost air travel. Sager (2006) refers to ‘‘freedom” as mobil-ity, the opportunities to travel when and where one mightplease. He, too, endorses the idea of mobility as a right,

15 See Footnote 8 – A–D equates to 1–4 as in the ACI classification.

B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451 1447

acknowledging, however, that these rights may be prob-lematic in that they have to be balanced against other dem-ocratic aims. Moreover, Larsen et al. (2006) argue thattime–space compression has not compressed but enlargedsocial network geographies and that ‘‘network capital” iscrucial to modern societies in that it allows corporeal traveland proximity. Nor is ICT an effective alternative to airtransport. Much leisure travel is undertaken for its ownsake while ICT can act as a facilitator and generator oftraffic by providing greater knowledge and easier bookingof air travel through the Internet (Giuliano and Gillespie,2002).

Urry (2000) speculates on some reasons for this appar-ent contradiction between burgeoning air travel and ever-more effective electronic communications, writing ofvoluntary travelling and mobility becoming a way of life.Such ideas invoke Adams’s (1999) concept of hypermobilesocieties with aspatial communities of interest in which wespend more of our time among strangers. Urry sees hyper-mobility as a function of the importance of networks, notleast of families in transnational communities, and the nat-ure of what he terms ‘‘meetingness” and ‘‘co-presence”,terms which refer, essentially, to the value of face-to-facemeeting compared to electronic communication. Thus thebases of travel are less rooted in the individual per se asin the properties of social relations between people, institu-tions and culture: ‘‘Mobility is vital to human existence. Itcontributes to defining the fabric of our lives and is quicklybecoming a formative element of existence” (Flamm andKaufman, 2006, p. 167). In tapping into this social con-struction of travel both as it applies to tourism and busi-ness, LCCs allow those who can afford it access to ‘‘co-presence” through mobility sold at a low (or perceivedlow) price.

4. Liberalization, economic development and sustainability

The consensus of one study into the oxymoron of‘‘sustainable aviation” is that, at best, the environmentalsustainability of the air transport industry is in doubt,although, conversely, aviation is delivering social andeconomic goods (Upham et al., 2003b). Air transportpolicy-making has been driven by the concern to introduce,implement and protect the competitive marketplace.Nevertheless, as is a characteristic of all transport modes,such policies do not encourage individual restraint in theuse of environmental resources on the part of any oneairline (Shaw and Thomas, 2006).

The LCCs do try to claim the environmental moral highground (Goetz and Graham, 2004). In both the UnitedStates and Europe, these airlines are ‘‘leveraging allresources more effectively. . . The cost differential betweenthe full-service and low-cost carriers is 2–1 for the samestage length and aircraft” (Hansson et al., 2003, p. 2). Thissuggests that EU LCCs which very largely operate young,more fuel-efficient, lower emission and quieter fleets, areusing certain resources more effectively than network air-

lines although they may not be more efficient in terms ofslot capacity at constricted airports. Nevertheless, theyare promoting growth in air travel, predominantly overshorter distances (Whitelegg and Cambridge, 2004) in nar-row-body aircraft of fewer than 200 seats on city-pairswhich could often be served by more sustainable forms oftransport. In so doing, LCCs are granted tax exemptionsand financial aid predicated on sometimes contestableassumptions that these services enhance national and regio-nal economies, while airport capacity is being expanded tocater for subsidized leisure passengers.

It is unsurprising, therefore, that there is mounting pub-lic opposition to aviation which focuses primarily on noise,emissions and capacity issues and is directly related to theincreasing volume of traffic and aircraft movements (see,for example, Airportwatch, 2005). Public opposition to avi-ation in general tends to focus primarily on noise ratherthan emissions. Whereas modern aircraft are quieter thantheir predecessors, it is the volume of traffic – both airsideand landside – that compounds public exposure to noise,particularly for residents in the hinterlands of major air-ports. In general terms, internationally negotiated andimplemented noise controls have largely realized the poten-tial returns from aircraft engine noise reduction and futuregains are most likely to come from advances in airframetechnology. The International Civil Aviation Organization(ICAO) introduced globally binding ‘‘Chapter 4” noise reg-ulations in January 2006 for newly certified aircraft(defined as the previous Chapter 3 limit �10 dB). In actu-ality, these regulations make little difference in Europewhere reasonably young aircraft fleets mostly already com-ply with Chapter 4. Any marginal gains will be over-whelmed by traffic growth dominated by the LCC sector.

It is now widely recognized, however, that the most seri-ous sustainability impacts of air transport stem from atmo-spheric pollution (Environmental Change Institute, 2006).Again, although technology has been successful in reducingatmospheric emissions per individual aircraft and passen-ger, the technological returns are diminishing and beingoffset by aviation’s growth. If present growth trends con-tinue, ‘‘air travel will become one of the major sources ofanthropogenic climate change by 2050” (Royal Commis-sion on Environmental Pollution, 2002, p. 37). Atmo-spheric pollution comes especially from: the effects ofcontrails in the upper atmosphere; nitric oxide/nitrogendioxide (collectively NOx) emissions; and carbon dioxide(CO2) emissions, the principal cause of global warming.Conventional turbofan engines, no matter how refined,cannot achieve emissions levels that will allow a stabiliza-tion of CO2 concentration in the atmosphere (Akerman,2005). It is estimated that aircraft emissions have increasedNOx ‘‘at cruise altitudes in northern mid-latitudes byapproximately 20%” (IPCC, 1999, p. 39). Because of avia-tion’s growth and the lack of alternatives to fossil fuels, thesector’s current 3% contribution to global warming mayincrease to between 10% and 20% of the total by 2050(IPCC, 1999). In addition, ground level emissions at

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airports, both from aircraft and surface vehicles, areincreasing, a trend exacerbated by the development of air-ports as major economic activity centres and intermodaltransportation hubs. Generally, while technology has beensuccessful in reducing atmospheric and ground emissionsper aircraft and vehicle, the technological returns arediminishing and being offset by aviation’s growth in whichLCCs are the most dynamic sector. If growth continues asforecast, domestic aviation might account for 25% of allUK carbon emissions by 2050 (Frontier Economics, 2006).

Technological improvements to reduce both noise andemissions are being offset by the escalating growth trendsin air travel which has been expanding at nearly 2.5 timesaverage economic growth rates since 1960 (EnvironmentalChange Institute, 2006). This means, for example, that pre-dictions of demand at UK airports range from between 400and 600 million passengers per annum (mppa) by 2030,compared to around 200 mppa in 2003 (DfT, 2003). It isprojected that UK aviation emissions will rise from 9.8 mil-lion tonnes carbon (MtC) in 2004 to 16–21 MtC in 2030(Bows and Anderson, 2007) and may reach as much as44.4 MtC by 2050 at a time when the UK is committedto limiting its total carbon emissions to 65m tonnes (Envi-ronmental Change Institute, 2006). Crucially, however,these targets do not include either international aviationor shipping. As one report observes:

Aviation emissions are a high-stakes issue for UK cli-mate policy. More than any other sector the aviationindustry, with its continued reliance on kerosene andits high growth rate, threatens the integrity of the UKlong-term climate change target (Tyndall Centre,2005, p. 49).

The same report observes that both the European Commis-sion and UK government are ‘‘encouraging continued highlevels of growth in aviation, whilst simultaneously assertingthat they are committed to a policy of substantially reduc-ing carbon emissions” (Tyndall Centre, 2005, p. 50). More-over, an increasing percentage of the projected increase ofglobal demand (in excess of 5% per annum) is being satis-fied by short-haul flights (Whitelegg and Cambridge, 2004).In overall terms, Stern (2006) calculated that aviation ac-counted for 1.5% of global greenhouse gas emissions, a fig-ure that rises closer to 3% in Europe; projecting currentgrowth trends, the global figure would rise to 2.5% by2050. Stern recommended that aviation should pay its fullcarbon price, either by higher taxes or emissions trading,noting that the choice of instrument would be driven asmuch by political viability as by economics.

Airlines pay no tax on kerosene while new aircraft andinternational tickets in the EU do not incur VAT. Domes-tic air tickets are also exempt in some countries includingthe UK, although there are alternative taxes such as theUK’s Air Passenger Duty (APD). The EnvironmentalChange Institute (2006), for example, in referring specifi-cally to the UK, recommends raising APD as a straightfor-ward measure to make flying more expensive. The British

government has done exactly that, doubling APD from 1February 2007 and making it retrospective to ticketsalready booked and paid for, although it is difficult to dis-agree with the vociferous complaints of the airlines thatthis was no more than a cynical attempt to raise revenuebecause income levied through APD (as with other so-called ‘‘green taxes”) is not hypothecated to environmentalpolicies.

Although aviation falls outside the Kyoto Protocoladopted in December 1997, the European Commissionwants to include the industry in the EU Emissions TradingScheme (ETS) from 2011 for intra-European travel to 2012for all EU air travel. The airlines are unhappy about thestaggered dates of the implementation of the ETS whileits full realization would require international agreementwith, for example, the United States that, currently, doesnot look as if it might be forthcoming. Nevertheless,although airlines, including most LCCs, would prefer anICAO global solution, they are reluctantly supporting theETS (European Aviation Industry Joint Statement, 2006).The impact of such a scheme would probably be greateron LCCs which are more sensitive to price than for full-ser-vice carriers (Frontier Economics, 2006) but it is seen as theleast worst option and preferable to taxes to push up oper-ating costs.

A final point here is that, arguably, the pricing mecha-nisms employed by LCCs are attracting passengers frommore sustainable forms of surface transport and are thusacting in exactly the opposite direction to the concept ofmodal shift ‘‘to more environmentally benign methods oftransport for short-haul flights” advocated by the RoyalCommission on Environmental Pollution (2002, p. 38).Within the implementation of EU policies for convergenceand cohesion, transport is regarded not a succession ofindependent modes and networks but as an integratedTEN. It may therefore be economically wasteful to dupli-cate modes while roads and high-speed trains (HSTs) offermore efficient accessibility for densely packed urbanregions than does air transport (Shaw et al., 2003; Givoni,2006). HSTs can compete effectively with air on inter-citypairs of up to 3 h and are far more energy efficient thanplanes. They use electricity which can be generated by dif-ferent fuels and are arguably cheaper in terms of relativeexternal costs; CO2 emissions per passenger on a typical500 km intra-European city-pair range from 1.17 kg/kmfor air travel to only 0.052 kg/km for rail (Wit et al.,2002). On the other hand, the EU HST network has rela-tively little to offer in terms of links to peripheries, evenif particular cities do benefit from the discontinuous natureof accessibility which this mode shares with air transport.

5. Conclusions

A complex mesh of tensions and contradictions ema-nates from the overlapping networks of relationships link-ing air transport in general, LCCs in particular andsustainability. Policies and strategies that might curb or

B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451 1449

diminish the environmental externalities of air transportare likely to be swamped by the forces promoting its devel-opment, the growth of LCCs being currently the mostimportant single factor in the EU. Enhanced mobility isboth proclaimed a human right and seen as fundamentalto economic development at national and regional scalesbecause of its input to increased tourism/leisure consump-tion. The marketing strategies of airlines, airports and theagencies charged with economic development strive toachieve precisely the opposite effect to the curbs on thegrowth of personal mobility inevitably intrinsic to sustain-ability. These strategies aim instead at enhancing air trans-port demand, increasing traffic volumes and divertingtraffic from more sustainable forms of transport. Airlinesand airports as privately-owned businesses have norational alternative but to cater to existing markets in waysthat generate maximum profit, while fostering futuregrowth. Meanwhile, governments and the European Com-mission give contradictory messages that seek both toexpand and constrain European air travel.

It is difficult other than to conclude that the dominantinterconnections remain those between the effects of liber-alization (often called ‘‘consumer benefits”) and economicdevelopment (with a dash of life enhancement from mobil-ity). OEF (2006) calculates that the environmental emis-sions resulting from a full implementation of the 2003UK White Paper runway proposals would cost £0.7b perannum while realizing around £13b wider economic bene-fits (at 2006 prices), an estimate that symbolizes preciselythe principal dilemma compromising the entire idea of rec-onciling aviation growth and sustainability. Banister et al.(2000) and Banister and Steen (2002, p. 74) argue moregenerally for a scenario termed ‘‘decoupling”, defined as‘‘maintaining levels of economic growth, but with lowerlevels of transport intensity – breaking the historic linkbetween GDP growth (desirable) and traffic growth (unde-sirable)”. Decoupling cannot be achieved by technologyalone but only ‘‘through a decrease in transport intensityof the economy” (Banister and Steen, 2002, p. 74). Largelydue to the growth of LCCs, decoupling is occurring in thenegative sense that growth in air traffic in the EU is exceed-ing GDP growth, while the transport intensity of the econ-omy is increasing through the enhancement of personalmobility and regional accessibility.

In terms of the relationship between the growth of theLCC sector and sustainability, the key issue is that, increas-ingly, these airlines are selling mobility (consumer behav-iour) as much as accessibility (economic development),while not meeting their external costs. The forecast increasein demand for air transport and airport capacity largelycomprises leisure travellers taking holidays abroad.16 ThusLCCs are promoting behavioural changes that are accentu-

16 Thus OEF (2006, p. 30) is reduced to justifying the UK’s tourismdeficit by stressing the positive role of tourism in ‘‘cultural exchange andeducation”; it argues that ‘‘virtually all tourism broadens the mind” andeven identifies a trend towards ecotourism.

ating the negative impact of aviation on the environment.In so doing, in aggregate terms, a substantial part of theiroperations are being subsidized by both public and privatesector agencies which seek to recoup their costs elsewhere.By selling low-fare, short-haul flights which ‘‘make a dis-proportionately large contribution to the global environ-mental impacts of air transport” (Royal Commission onEnvironmental Pollution, 2002, p. 37), LCCs are the mostpotent factor growing the demand for air transport in Eur-ope. Conversely, a pro-environment approach wouldrestrict airport development, raise the implicit price oflanding and take-off slots and thus enhance the potentialfor modal shift to rail for domestic journeys (Royal Com-mission on Environmental Pollution, 2002). Aviationwould be regarded as ‘‘a prime candidate for demand man-agement precisely because its rate of growth is large enoughto cancel out gains from technical improvements” (Whitel-egg and Cambridge, 2004, p. 26).

Airlines, including the LCCs, do not pay for the exter-nalities which they create, despite air transport being themost environmentally damaging form of transport per pas-senger-kilometer. The costs of so doing do not seem exces-sive. GreenSkies estimates that charging passengers thecost of CO2 emissions would amount to only 2.73€ perintra-European return ticket price (Flight International,2005). Other studies suggest that a rise in average ticketprices of €3–5 and €10–16 for a single short-haul andlong-haul flight, respectively would be a sufficient environ-mental charge proportional to the greenhouse gas emis-sions discharged within the EU (Wit et al., 2002).Moreover, while aviation’s share of emissions is increasing,together with other forms of environmental externalities,the LCC model clearly enhances the social inclusion dimen-sion to air transport in off-setting the spatial concentrationof hub-and-spoke networks and using scarce airport capac-ity more effectively. Taking into account concerns such as‘‘leakage” to other regions, the calculation of net benefitsvis-a-vis inward and outward expenditure and the method-ological difficulties in capturing the extent of their contri-bution, LCCs do have a positive role to play in economicdevelopment, particularly in less advantaged, peripheralor remote locations. Ironically, of course, these benefitsoften stem from the interconnection of low-cost air travelwith tourism, another major industry with a dubious sus-tainability record (Hickman, 2007).

Nevertheless, in Europe, as elsewhere, the low-cost airtransport model is ultimately unsustainable in environmen-tal terms if only because of its dependence on oil. Likemuch else in the aviation business, it is a strategy domi-nated by short-termism and self-interest which has changedthe social structure of air travel but has also accelerated thegrowth rates of a mode that is the fastest-growing cause oftransport’s contribution to atmospheric emissions. Aboveall, low fares allow customers to fulfil derived demand ina much wider variety of ways and more often while alsostimulating latent demand at regional airports. This is sat-isfied with relatively small aircraft flying short sectors

1450 B. Graham, J. Shaw / Geoforum 39 (2008) 1439–1451

which could often be served more efficiently by terrestrialmodes of transport. Although growth rates may declineas the market matures, it is transparent that the environ-mental externalities of aviation will grow accordingly. Ulti-mately, the success of the LCC model has depended on theassumption that air transport remains heavily subsidizedand, unlike every other transport mode, stands outsideany notion of demand management.

In terms of the interconnections between liberalization,economic development and environmental sustainability,policy-makers continue to deliver contradictory (or hypo-critical) messages, promoting air traffic growth atEuropean, Member State and regional scales, while, simul-taneously, calling for constraint in the interests of the envi-ronment. As in the UK, where the 2003 White Paper madeit clear that the government put the national economybefore the environment, the balance rests still with theeconomic imperative – as does the Lisbon Agenda – butthe tipping-point rests with the unpredictable future impor-tance of global warming as a political agenda. As the avi-ation industry moves from a state of denial onenvironmental issues, it is increasingly concerned at itsexposure. Many people are antagonistic to air transport(except when flying) but, unlike road transport, few usethe mode on an everyday basis. It is this potential role asan acceptable and very public target for political interven-tion which means that the Europe’s aviation industry anddevelopment agencies have to be open to the possibilitythat the economic imperative may not always provide suf-ficient justification for their actions. The interconnectionsdiscussed here demonstrate that policy intervention inone sphere can only have consequences for others.

Acknowledgements

We are grateful for the editorial guidance and the veryhelpful comments of three anonymous referees.

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