Monarch Airlines aircraft are pictured on the tarmac at Birmingham Airport in Birmingham, central England on October 2, 2017.
/ AFP / OLI SCARFF
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It is the third failure of an European airline in six months. Both Air Berlin and Alitalia went into insolvency proceedings this summer, after struggling to cope with the intense competition from rival carriers.While the European short-haul market has been extremely competitive for the past two decades, as low-cost airlines have aggressively grown their share of the market, lower fuel prices have contributed to an increase in competition in recent years.Just 15 years ago, budget airlines had just over 9 per cent of market share in Europe.Data from OAG shows that Spain has seen the addition of about 16m seats into the market over the past two years as carriers throughout Europe have added capacity after vacating high risk markets.All three airlines that have entered insolvency proceedings this year – Monarch, Air Berlin and Alitalia – have one thing in common: they have been struggling for years.Carriers in North America are expected to post a $15.4bn net profit in 2017, compared with a $7.4bn profit for European airlines.
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