Analyzing the Impact of Low-Cost Carriers on the Asian Tourism Industry
The low-cost carrier is a new kind of type in air transport. It is designed for people who have little budgets. Different from the traditional full-service carrier, low-cost aircraft provides discounts on the tickets. As Hunter L. stated: ’The passenger air travel industry is characterized by the emergence of low-cost/ no-frills sector alongside and partly in competition with the incumbent full-service carriers.’ (2006:351) The passenger witnesses the decision between low-cost carrier (LCC) and full-service carrier (FSC). Before LCC appeared, the traditional FSC occupied the market considerably. According to a table draws on ITF (2002): and Alderighi et…
the profitability and sustainability of Full Service Carriers (FSC) and Low Cost Carriers (LCC). The main aim of the study was to find out the demand for travel on each type of airlines. Furthermore, the company could decide if it wants to launch a full service carrier and if investing in LCC would reap significant profits or become a liability.
Incheon International Airport in Seoul, South Korea was chosen as the base point for both carriers with high travel demand and low number of…
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…
High cost carriers can offer low fares, but these are not sustainable (Tretheway, 2004).
In aviation sector, deregulated markets, entrepreneurs, population growth and economic wealth, availability and capacity of secondary airports and the growth of internet use as a distribution channel accelerated the spread of LCCs (Francis, Humphreys, Ison, Aicken, 2006).
Southwest, Ryanair, easyJet, Westjet, GOL and Air Asia are examples of this model.
Hybrid airline business model…
cut-throat competition for employees which, in turn, is driving wages to unsustainable levels. Moreover, the industry is unable to retain talented employees.
2. Regional connectivity: One of the biggest challenges facing the aviation sector in India is to be able to provide regional connectivity. What is hampering the growth of regional connectivity is the lack of airports.
3. Rising fuel prices: As fuel prices have climbed, the inverse relationship between fuel prices and airline…
PORTER’S 5 FORCES ANALYSIS – INDIAN AVIATION INDUSTRY
Threat of New Entrants
1. Setup Cost
As on today, venture capital of $15 Million is enough to launch an airline service. Airlines can also utilize an ACMI lease agreement for extra aircrafts. If you have more aircrafts then you can also offer few aircrafts on lease to other airlines, especially in the peak season to cope-up with traffic and loads.
2. Fuel Price
ATF has been increased many folds from the beginning. In India, companies do…
airline in India by providing the following values to the customer:
• Affordable fares
• On-time performance
• Hassle-free service
The strengths of Indigo include: Business Model, High Brand Awareness, Cost Leadership, innovation, Age of Equipment, etc.
Indigo has Low Cost, not low quality model. They concentrate on greater operational efficiency, better positioning and cost leadership.
Greater operational efficiency:
• Indigo has less gate turnaround time of 16 minutes.
• Better aircraft…
Air party Canada Ltd. is a Canadian low-cost carrier that has recently approached the transport aircraft market.
Founded in 2014, it is currently one of the last Canadian air carrier.
Air party Canada is a private company with around 1,000 employees, is non-unionized and is not part of any airline alliance. It operates one Airbus A330-300.
The airline 's headquarters is located near to Toronto Billy Bishop national Airport, which also serves as its hub.
AirPartyCanada has earned in his first…
Sun Country Airlines (SY) has a very unique marketing strategy for its niche, but its advertising has definitely proven effective. Sun Country has found its role in the airline industry, not as a legacy or a low-cost carrier, nor as a charter company (even though charters account for a large portion of their business), but as an airline in its own lane. This small hometown airline has weathered the storm through two bankruptcies, corrupt ownership, 9/11, and a recession or two. Sun Country is…
SpiceJet is an low-cost airline headquartered in Gurgaon, India. It is the third biggest aircraft in the nation by number of travelers conveyed, with a piece of the overall industry of 13.2% as of March 2017. The carrier works 312 day by day flights to 55 goals, including 45 Indian and 10 global goals from its centers at Delhi, Kolkata and Hyderabad.
Built up as air taxi provider ModiLuft in 1994, the organization was gained by Indian business person Ajay Singh in 2004 and re-dedicated as…