Low-cost airlines are expected to carry as many as 80 million passengers in Europe in 2004, up from 47 million last year, Mr Wolfgang Kurth, president of the European Low Fares Airlines Association, said yesterday

.No-frills operators were forecast to capture around 18 per cent of the market on intra-European routes this year, as they both opened new routes and took market share from the traditional network airlines.

Mr Kurth, chief executive of Hapag Lloyd-Express (HLX), the German low-cost carrier and a subsidiary of Tui, Europe's largest tour operator, said the recent growth rate of about 40 per cent a year in passenger volumes was expected to continue for at least two years.

He played down recent warnings from Ryanair and EasyJet - the leading European low-cost airlines - of a looming "bloodbath" in the sector in the face of a fierce price war and serious overcapacity.

There are currently 67 low-cost carriers operating in Europe, said Mr Kurth, and while a process of consolidation was eventually inevitable, for the moment new carriers were still entering the market to replace those that collapsed.

In Germany alone the number of routes operated by low-cost carriers had grown from four in 2002 to 300 today, while the number of no-frills airlines had jumped from two to 15.

Mr Kurth said the number of seats offered by the low-cost carrier sector had jumped from 700,000 in a sample week in July 2000 to 7.5 million in the same week this year.

HLX was planning to raise its own capacity by 35 per cent by next summer with its fleet growing from 11 to 15 aircraft.

Mr Kurth said that average fares were expected to fall further in coming years, which would lead to additional cost-cutting by the no-frills operators.

Pressure would be increased on both aircraft makers and airports to cut charges. At the same time airports would need to provide more basic facilities designed for low cost airlines.