The aviation sector is currently undergoing a dynamic recovery worldwide: passenger numbers continue to rise and have already surpassed 2019 levels in some markets. However, the trend is not uniform – particularly in Germany, where the recovery is proceeding at a significantly slower pace than in many other countries.
Increasing demands on airlines, airports and other market players
Rising costs, capital intensity and pressure to improve efficiency
The cost base for airlines and airports has risen significantly as a result of higher staff costs and an increase in taxes and charges. Added to this are volatile fuel prices and exchange rate fluctuations, which play a key role, particularly for airlines operating internationally. At the same time, in an environment of high financing costs, the capital-intensive aviation sector requires substantial investment in fleet modernisation, digital infrastructure, terminal and capacity expansion, and sustainability programmes.
Furthermore, in order to realise economies of scale, stabilise margins and unlock efficiency potential, strategic pressure for consolidation is growing in Europe.
Changes in travel behaviour and demand patterns
The demand profile has shifted permanently: whilst business travel remains well below previous levels, tourist demand is growing at a disproportionately high rate both globally and in Europe. For airlines, this means more fragmented and short-lived demand, with an increasing focus on price flexibility and the quality of digital services.
Geopolitical uncertainties and market volatility
Geopolitical tensions, regulatory changes and airspace restrictions are having an increasing impact on route planning, capacity, demand and costs. These uncertainties not only influence travel behaviour but also place greater demands on operational resilience and risk management. At the same time, the importance of cybersecurity is growing, as cybercrime is one of the key risk areas in the transport sector.
Sustainability, decarbonisation and regulatory pressure
Airlines and airports are under considerable regulatory pressure to reduce emissions and meet increasingly stringent requirements, such as quotas for the use of Sustainable Aviation Fuels (SAF) and European emissions trading schemes. Measures such as the use of SAF, fleet modernisation and new operating models are key drivers of decarbonisation, but at the same time significantly increase costs.
Digitalisation, automation and modern infrastructure
The industry is undergoing a profound digital transformation, characterised by AI-powered flight planning, automated handling processes and cyber-resilient IT systems. Both operational performance and customer experience – crucial factors in an increasingly complex market environment – require early investment in a modern digital infrastructure.
For many years, we have been using our industry expertise to help companies overcome these challenges and position themselves in an increasingly complex environment.
Rising costs, capital intensity and pressure to improve efficiency
The cost base for airlines and airports has risen significantly as a result of higher staff costs and an increase in taxes and charges. Added to this are volatile fuel prices and exchange rate fluctuations, which play a key role, particularly for airlines operating internationally. At the same time, in an environment of high financing costs, the capital-intensive aviation sector requires substantial investment in fleet modernisation, digital infrastructure, terminal and capacity expansion, and sustainability programmes.
Furthermore, in order to realise economies of scale, stabilise margins and unlock efficiency potential, strategic pressure for consolidation is growing in Europe.
Changes in travel behaviour and demand patterns
The demand profile has shifted permanently: whilst business travel remains well below previous levels, tourist demand is growing at a disproportionately high rate both globally and in Europe. For airlines, this means more fragmented and short-lived demand, with an increasing focus on price flexibility and the quality of digital services.
Geopolitical uncertainties and market volatility
Geopolitical tensions, regulatory changes and airspace restrictions are having an increasing impact on route planning, capacity, demand and costs. These uncertainties not only influence travel behaviour but also place greater demands on operational resilience and risk management. At the same time, the importance of cybersecurity is growing, as cybercrime is one of the key risk areas in the transport sector.
Sustainability, decarbonisation and regulatory pressure
Airlines and airports are under considerable regulatory pressure to reduce emissions and meet increasingly stringent requirements, such as quotas for the use of Sustainable Aviation Fuels (SAF) and European emissions trading schemes. Measures such as the use of SAF, fleet modernisation and new operating models are key drivers of decarbonisation, but at the same time significantly increase costs.
Digitalisation, automation and modern infrastructure
The industry is undergoing a profound digital transformation, characterised by AI-powered flight planning, automated handling processes and cyber-resilient IT systems. Both operational performance and customer experience – crucial factors in an increasingly complex market environment – require early investment in a modern digital infrastructure.
For many years, we have been using our industry expertise to help companies overcome these challenges and position themselves in an increasingly complex environment.
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Your contact
Christoph Köllmer
Partner, Performance & Strategy, Turnaround & Restructuring
KPMG AG Wirtschaftsprüfungsgesellschaft