Journal
JOURNAL OF AIR TRANSPORT MANAGEMENT
Volume 11, Issue 5, Pages 303-312Publisher
ELSEVIER SCI LTD
DOI: 10.1016/j.jairtraman.2005.07.002
Keywords
responses to low cost airlines; productivity; airline costs
Categories
Ask authors/readers for more resources
The establishment of Low Cost Carrier offshoots by network carriers has three possible objectives: to spin off profitable businesses; to see off low cost competition in key markets; and to establish a test-bed for adapting low cost business processes to their mainline operations. It is argued that US network carrier offshoots have failed on all three counts. The significant cost differences between network and Low Cost Carriers are identified, and it is shown that network carriers have made little inroads into closing this gap, whether or not they set up Low Cost Carrier offshoots. Some reasons for the failure of the offshoots are proposed by examining operating differences: mixed fleets, keeping interlining and two class cabins and the lack of progress on reducing labour costs. Labour Union restrictions and the lack of separation from the main airline were crucial. (c) 2005 Elsevier Ltd. All rights reserved.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available