DESPITE the crisis-hit tourist industry, German airlines are to start using Palma airport as a hub for new markets and destinations. German airlines have been developing Son San Joan as a hub for the past few years and with extensive improvement and expansion work underway at the airport, this winter a 20 per cent increase in flights from Germany to Palma is being programmed and some of the airlines are going to start operating domestic flights between Palma and Ibiza, Madrid and Barcelona. As expected Palma will also act as a staging post for winter sun flights from Germany to the Canaries and North Africa. While the German package holiday sector to the Balearics is struggling this year, down by as much as 25 per cent, the airline sector appears to be far more confident and believes that the 20 per cent increase in flights will meet demand from the resident as opposed to the tourist sector. The news also comes on the back of an announcement by Europe's leading tour operator TUI, which owns Thomson Holidays, that it is setting up a low cost airline. This winter, travellers will be able to cash in on a price war between low cost and scheduled airlines in Europe. Many of the major airlines have already announced huge discounts and special offers in a bid to try and get people flying again and compete with the low cost operators.