Dogfight Over London And Paris, Rome, Madrid...

With full deregulation slated next April, Europe's airlines are gearing up--and slashing fares

It was an ominous move by Germany's Lufthansa, and a hint of things to come for Europe's other big national airlines. Dogged by feisty new carriers that have slashed fares and taken away passengers, Lufthansa announced on July 29 that it will cut capacity on European routes this fall. The German airline is also launching a new austerity plan--the latest of a series--to lower costs so it can counterattack the fare-cutters.

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