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Wednesday, 19 September, 2001, 15:00 GMT 16:00 UK
Go launches new services
Go aircraft
Go's new routes will boost competition in the "low cost" market
By the BBC's business reporter, Marcia Hughes

Go's new service between Dublin and Edinburgh and Glasgow shows the airline's keenness to take on its rivals since being sold off by British Airways.

The move will increase the "low cost" competition as the Dublin/Scotland route has so far been monopolised by Europe's biggest budget airline Ryanair.

"What we are seeing here is that Go is introducing two new routes to Dublin, increasing their competition with Ryanair," said Morten Herholdt of Barclays Stockbrokers

"It alsoshows that low cost carriers are expanding their capacity in contrast to mainline carriers who are cutting theirs,".

Passengers boarding low-cost airline
Passenger confidence is at an all-time low

These are trying times for the airline industry with passenger confidence at an all time low.

A sharp decline in air travel and increased security costs mean the big operators are struggling.

Already there have been hundreds of job losses at many carriers, including Boeing, Continental, Virgin Atlantic and American Airlines, with British Airways widely predicted to be the next bearer of bad news.

Its boss Rod Eddington, and chiefs at Virgin and BMI, have already started discussing their concerns with Transport Secretary Stephen Byers, calling among other things for tax relief to help boost the industry.

The next step will include talks with charter and low cost carriers.

While these are not as badly affected as the major airlines, restoring passenger confidence is important to all concerned if damage to the industry is to be minimised.

A close eye will now be kept on state subsidies.

So far individual countries' flag carriers are not allowed to be singled out and given preferential state aid.

Ryanair is one airline to speak out that this policy should not be altered in any way so that all operators are treated equally.

See also:

19 Sep 01 | Business
US aviation crisis deepens
18 Sep 01 | Business
UK airlines call for state aid
06 Sep 01 | Business
Better deal for air passengers
13 Sep 01 | Business
Air industry faces bleak outlook
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