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Low Cost Airlines will have to Evolve

Low cost airlines continue to expand worldwide. And the future of conventional airlines will partly depend on the development of their subsidaries in charge of the low cost transport. According to the surveys of the IATA (Int. Air Transport Ass.) and of Amadeus (Global distribution system) low cost will be key for the development of airlines. London with nearly 15 million aircraft seats is the world's low cost capital and Warsaw is the fastest growing market in this segment with a rate of growth of 64%. But in this field, Asia and in particular Indonesia and India show a substantial growth of 28%. This is not surprising because seven out of the top ten world's busiest air travel routes are in Asia. Globally low cost airlines continue to win market share to the detriment of the traditional airlines. Despite this the low cost model is clearly in a state of change. Ryanair (Ireland) and Easyjet (UK) share most of this market in Europe. The Irish company is far ahead of its main competitor in terms of passengers carried, 80 million in 2013 compared with 60 million for the British company. However Ryanair has an average income per passenger which is 30% lower than that of its competitor. And this is because it remained faithfull to its business model by offering to its customers a minimum service and a Spartan comfort. On the contrary the UK firm offered to its passengers more sophisticated and customised services. But it is above all the counter-attack which was launched by many traditional carriers which could eventually undermine the low cost airlines which invented this concept. Germanwings (Lufthansa) or Transavia (Air France-KLM), to mention but a few, charge agressive air fares to attract a new clientele. And,rightly, quality and customer service have remained the focus of many national airlines. Because it is clear that the low price ticket alone will not be sufficient to ensure customer loyalty. And this holds true for all air operators.

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