Future of Low-Cost Airlines

 Future of Low-Cost Airlines Essay

Assessment Item 4: Workshop Paper

Outline two feasible ‘likely futures' for the low-cost airline industry.

The cheap model in the airline market, pioneered simply by Southwest Flight companies, continues to take profitability, achievement and issues to flight companies in markets across the world. Cheap airlines still put pressure on the classic ‘legacy' flight companies to contend while engaged in an intense competition with immediate low-cost rivals. This daily news argues the fact that low-cost airline industry will probably (i) check out long haul operations as a source of growth and (ii) experience significant convergence and loan consolidation within the market.

Until recently, low-cost air carriers have predominantly been short haul businesses. This is because of in part towards the regulatory circumstance of long term services and core components of low-cost functions not being appropriate for long haul combats (Flint, 2003). Full combination border mergers are still constrained by nationwide regulations in many instances. However , the dominant air carriers have been increasingly successful in lobbying for the relaxation of such restrictions (AAPA, 2011). Low priced carriers will certainly continue to make different types to their operations to accommodate a lot more complex requirements of long haul flights and consumer needs (meals, in-flight entertainment and more leg room). Southwest air carriers have already purchased larger 737's capable of longer transport flights and intends to introduce wi fi in all aircraft by 2012. This is a clear signal from the airlines intent to grow into new longer-haul market segments. Jetblue has recently experienced achievement though their entrance in Mexican and Caribbean marketplaces. This tendency of intercontinental expansion appears set to continue as low cost airlines look outside already crowded domestic markets pertaining to growth.

The cheap model features increasingly impinged on the revenue of classic airlines, driving them to assessment their own technique. Airlines include looked to create strategic alliances, mergers and...

References: AAPA (Association of Asia Pacific cycles Airlines), March 2011, Long term Growth of the Airline Industry,

Cronshaw, M. Davis, E. & Kay, M. 1994, ‘On Being Stuck in the Middle or perhaps Good Foodstuff Costs Less in Sainsbury's', United kingdom Journal of Management, Volume. 5, (1), 19-32.

Dostelar, I. 2004, ‘Business Technique and Competition for the Future inside the Airline Industry', Aerlines Publication,  Issue 28.

Flint, L. 2003, ‘The world has evolved forever', Air Transport Universe, Vol. 40, (3), 22–26.

Francis ou al., 2006, ‘Where subsequent for low cost flight companies? A spatial and temporal comparative study', Journal intended for Transport Location, Vol. 18, (2), 83-94.

Porter, Meters. 1980, Competitive Strategy: Techniques for Analyzing Sectors and Rivals, New York, NEW YORK: Free Press.

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