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International Low-Cost Airline Market Research

At the beginning of the 1980’s , the first Low Cost Airlines (LCC)  were initially ridiculed as a peripheral “exotic” business case phenomenon, especially by global network  or national flag carrier. No one from the established airlines sincerely believed that it can be a sustainable and successful business model, or even constitute a threat or an serious alternative to their  existing business model.

With  rising number  of  passengers, traffic capacities and sales revenues over the last 30 years, the low-cost airline business is a very successful concept and copied by many network carriers and newly founded airlines.

Worldwide market share in 2013 ,  FSC vs. LCC  (FSC = Full Service Airlines, LCC= Low Cost Airlines)

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Evoltuion of market shares- focusing the European Market- (FSC vs. LCC) – comparing 2005  to 2013

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Who are actually Low-Cost airlines – We identified 112 LCC Airlines

The most important question within our research. Approximately  176 Airlines worldwide claimes to operate as Low Cost Carrier, we examined them all: we have  set up different criteria and categorized every single airline – here are the results –LCC2_Web

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Core LCC Airlines with the clearest sustainability, reliability, operating performance and economical growth

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Together, the o.g.  Airlines offer more then 749.000 Seats per day and covering 4031 Destinations worldwide.

Operating Performance -high!

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punctuality-webtraffic_density-kopieren

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Passenger Load Factors – high!

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Flight Safety Evaluation –  high!

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Economic efficiency – high!

The LCC Carrier produces with less costs then the Regular Airlines.

That economic efficiency is reflected also on the price structure, the graphic below shows the average cost savings of LCC’s in comparison to the avearge fares of FSC’s

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Passenger Satisfactory Survey – good!

According to  our passenger satisfactory survey (COSY) , more than  1. 400 Business Traveller’s evaluated 62 international airlines , including  LCC’s  – The gap between FSC’s and LCC’s is getting smaller.

Rating scale : 1 = poor —-> 5 = Excellent

COSY_LCC_FSC

 Forecast –

The differences of  business concept are becoming smaller,  a rapprochement between FSC and LCC is already taking place and will continue

lcc13_webWithin the  EU –  LCC’s traffic  increases continuously

LCC14_webSummary

  • Low Cost Airlines are no marginal phenomenon 
  • Core LCC’s form for almost 20 years a sustainable aviation business model
  • A rapprochement between FSC and LCC is already taking place and will continue.
  • Since 2004 till today, 52% of the newly founded LCCairlines have ceased operations
  • The average operating time of new founded LCC’s is in average 3.8 years
  • The core” LCC will continue to displace regional carriers and “niche Carrier”
  • LCC will continue to increase their market share
  • LCC ticket fares will rise continuously in the future
  • LCC‘s increase the pressure on the FSC‘s – services and price competition will increase
  • Modern IT Systems  and social media are used by the LCC‘s to keep battle for customers and market share

Infographic

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Our  research is based on  more then 9.000 detailled data fields

LCC-Data-1LCC-Data-2

Order the complete Excel data table here!

 

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