Southwest Airlines And Its Impact On The Aviation Industry

1055 Words 5 Pages
The aviation industry is one of that is always evolving and growing over time. One of the major factors that keeps the industry growing every day is the growth of low-cost carriers worldwide. LCC 's have been helping grow and shape the industry for not only consumers but for air carriers. In 2005 the European market share for low-cost carriers was estimated at 17% when reevaluated in 2013 it was estimated at 32% which was a 15% increase.(airlineprofiler.eu) In 2013 it was also estimated that the worldwide percentage of LLCs was estimated at 22%. In the United States LLCs were very limited in the beginning at solely revolved around Southwest Airlines. In 2013 an article by Airline Profiler stated there were approximately 172 LLC 's across the …show more content…
The legacy carriers Delta and United still have a good portion of the market share however due to the addition of many LCC’s they now have to split the market. LCCs have been able to have a positive growth on the industry due to the strategic planning by typically enter city-pairs with high passenger volume which helps them compete in the market against legacy carriers. They are also able to introduce their competitive rates,quick turnarounds and easy access to the consumers. As shown by the two examples above LCC”s are growing and taking some of the market share which is negatively affecting the legacy carriers. This is the main reason legacy carriers have not been welcoming to LCC’s and concerned that with the growth of LCCs their companies will start to …show more content…
“LCCs have had an incredible impact in terms of costs and fares and at the same time are putting the fear of God in the legacy carriers’ hearts," analyst Darryl Jenkins. The rapid growth of LCCs have increased the number of flights and seats available to consumers at a lower price than the typical legacy airlines. This has make it difficult for legacy carriers to keep up in the market. The legacy carriers find themselves in a more competitive market in their own hub stations. A most recent issue is where Norwegian Air wanted to enter the US market. Many carriers banned together to stop the expansion. The main threat was that Norwegian Air had shortcuts that made it possible to have low fares but also made it impossible for other airlines. According to an article on The Hill unions and lawmakers from both sides of the aisle have blasted its subsidiary for operating under a certificate from Ireland, where it doesn 't fly, and for hiring pilots contracted through Asia, where labor rates are lower. Allowing a company like Norwegian Air into the market can be detrimental and open up the doors for other LCCs to look at how they could get around operating cost just to have low fares. The airline industry is run as a fair competitive market and when one competitor registers in one country even though they are not based there just so they can bypass a regulation and hire cheaper employees makes it

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