With less than 24-hour’s notice, German aviation giant Lufthansa shocked the market by introducing an “environmental cost surcharge” of up to €75 per flight (that’s $120!) to take effect for any travel commencing from 1st January 2025.
The airline puts this down to the cost of complying with the new green regulations for airlines set by the European Union.
The exact amount of the charge will depend on the flight route and fare, so it will vary between €1 and €72 and apply to all flights sold and operated by the Lufthansa Group departing from any EU member states, as well as from the UK, Norway and Switzerland.
So as Australian travel buyers and managers should be concerned?
For now InTravel Group would say, be aware. Whilst Australia has not the same level of sustainability regulations imposed on trave as Europe, we have tended to see Australia use Europe as a blueprint to work towards. It is why sustainability, and more broadly ESG, in Australia looks much like it did in Europe 10 years ago. That may seem like a long time, but the rate and pace of change is likely to quicken and we expect to see that gap close.
So aside from being aware, what else could you do? We’d suggest start by making sure you are prepared with some fundamentals:
- Establish a baseline for the carbon footprint of your travel program today so you know where you are managing from. For this you want to ensure good CO2 reporting is in place.
- Review your travel policy. Many policies were written in an age when cost was the only consideration. “Best fare of the day” often meant indirect routes were flown, or cheaper fares were offered by airlines with aging equipment, so price was their only level. CO2 emissions are going to be lower on airlines flying the latest fuel-efficient fleets on the most direct routes.
- Raise awareness within your organisation at all levels that travel will increasingly be under the environmental microscope. That awareness will be needed to gain executive approval for change, but also to reinforce the travelling behaviours your organisation expects to see practiced
- Just as you want to ensure your travel reporting is up to the task, the same applies to the booking technologies your company is using. Visibility into the carbon footprint of the various options is an important way for travellers to be part of the decision making and aiding your organisation in meeting its environmental goals
If you’d like to know more on this, get in touch with our Value Manager, Carly Harris. You can connect with Carly here