Low Cost Airline

Low Cost Airline

Low-cost airlines also known as Low-Cost Carrier (LCC) originated as alternatives to legacy airlines also known as Full-Service Carrier (FSC).

Low-cost airlines attracted cost-conscious travelers by offering competitively low fares at rock-bottom prices while charging extra for other flight services. For example, meals and ancillary services are provided for an additional cost, which has already become a lucrative source of revenue for airlines.

Characteristics of Low-Cost Airline

Low-cost airlines are able to provide such competitive low fares by maintaining efficient aircraft utilization and lean operating costs. A few of the characteristics of low-cost airlines are as follows:

  • Low-cost fares
  • High aircraft utilization
  • Homogeneous fleet structure (which reduces the aircraft maintenance cost)
  • Lean Operations
  • Faster aircraft turnaround time
  • Point-to-point routes
  • Utilization of secondary airports
  • Strict cost-cutting measures

Competitive low fare is the primary advantage and major selling point for low-cost airlines. However, it’s the implementation of various other strategies that have provided Low-cost airlines a competitive edge over the full-service carriers.

For example, low-cost airlines largely operate on point-to-point routes, serving the secondary markets with high growth potential, which was largely neglected by the legacy airlines. This strategy provided low-cost airlines with an untapped market for growth. The continuation of this strategy also helped low-cost airlines to create a new passenger segment for themselves by opening new routes and serving the markets beyond the reach of legacy airlines. As a result, low-cost airlines took away a large share of the passengers from the existing legacy airlines.

Also, by maintaining lean operating costs and efficient flight operations, low-cost airlines have a much lower CASM in comparison to legacy airlines and have therefore been successful in staying competitive in the market.

Major Global Low-Cost Airlines

The major global low-cost airlines are:

  1. AirAsia – Malaysia
  2. EasyJet – UK
  3. Norwegian – Norway
  4. Southwest Airlines – US
  5. AirAsia X – Malaysia
  6. Jetstar Airways – Australia
  7. WestJet – Canada
  8. Indigo – India
  9. Ryanair – Ireland
  10. Eurowings – Germany

Major Low-Cost Airlines in Asia

The major low-cost airlines in Asia are:

  1. AirAsia – Malaysia
  2. AirAsia X – Malaysia
  3. IndiGo – India
  4. Scoot – Singapore
  5. Jetstar Asia – Singapore

Major Low-Cost Airlines in Europe

The major low-cost airlines in Europe are:

  1. EasyJet – UK
  2. Norwegian – Norway
  3. Ryanair – Ireland
  4. Eurowings – Germany
  5. Vueling – Spain

Major Low-Cost Airlines in North America

The major low-cost airlines in North America are:

  1. Southwest Airlines – US
  2. WestJet – Canada
  3. Air Canada Rouge – Canada
  4. Spirit Airlines – US
  5. Frontier Airlines – US

Major Low-Cost Airlines in South America

The major low-cost airlines in South America are:

  1. Sky Airline – Chile
  2. Easyfly – Colombia
  3. Gol – Brazil
  4. Viva Air – Colombia
  5. JetSmart – Chile

Major Low-Cost Airlines in Africa

The major low-cost airlines in Africa are:

  1. Fastjet – South Africa
  2. Mango – South Africa
  3. Jambojet – Kenya
  4. Fly540 – Kenya