Brussels, 30 June 2025 – A new study reveals that current EU sustainability policy threatens to shift passenger activity to non-EU destinations, undermining European competitiveness as well as sectoral decarbonisation goals – with the projected 26% CO₂ reductions set to be delivered by the EU’s ReFuelEU Sustainable Aviation Fuel (SAF) mandate potentially shifting to non-EU competitors instead. This could undermine climate goals and diminish Europe’s attractiveness as a destination unless policy gaps are closed.
Deloitte’s independent study for Airlines for Europe (A4E) gauges the twin threats of carbon and business leakage. Specifically, it models possible scenarios in which the EU’s stricter environmental regulations could shift flying to other destinations and to carriers not subject to the same level of sustainability rules, creating additional market distortions that would potentially lead to higher emissions and higher costs for consumers.
For example, the report finds that ReFuelEU will widen cost gaps on key EU–Asia routes to 15% by 2030, driving travellers towards non-EU hubs that are not subject to equivalent SAF rules. In response, A4E is calling for the European Commission to propose a series of policy measures to mitigate against this and it has set out potential policies in recommendations that accompany the study. Amongst them, the report tests a so-called Sustainable Aviation Fuel Border Adjustment Mechanism (SAF-BAM) that would charge connecting flights the same SAF-related costs faced by EU airlines. Deloitte’s study suggests that a SAF-BAM could “eliminate leakage on modelled routes” and restore a level playing field without raising consumer prices overall.
“Europe cannot afford a climate policy that haemorrhages passengers, jobs and emissions to competitors and destinations next door that don’t face the same ambitious climate policies as in the EU. This report shows that a well-designed mechanism to mitigate against this would keep fares fair, cut carbon where it counts and ensure Europe continues to have a vibrant airline market. We urge policymakers to act swiftly and pragmatically to implement a combination of policies set out in our policy recommendations to deal with this issue,” said Ourania Georgoutsakou, Managing Director, Airlines for Europe (A4E).
ENDS
Download the full report and A4E Policy Recommendations
About A4E
Airlines for Europe (A4E) is the continent’s largest airline association. Based in Brussels, it works with EU institutions to keep aviation safe, competitive and sustainable. A4E’s members operate more than 3,700 modern aircraft, carried over 771 million passengers in 2024 and served almost 2,800 destinations worldwide, transporting 54 million tonnes of essential cargo each year.