have low cost operators damaged the industry?
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have low cost operators damaged the industry?
SLF here so feel free to treat with contempt or delete as appropriate!!
My daughter is cabin crew at Astraeus, and like most of her colleagues is about to loose her job it seems, mainly because many airlines are finding it increasingly difficult to make money in the current market.
Reading through many of the airline threads there appears to be widespread dissatisfaction with nearly all carriers at the moment, much of which appears to be driven by the long hours, low pay and unfavourable shift patterns driven by the need to make money whilst offering very low fares.
As a businessman I must ask is it sustainable to offer £30 fares or lower on an aircraft that costs $100m, requires qualified crew for safety and of course must be fueled (ever increasing) and maintained to a high standard. Any delay requires pax to be accommodated at high cost, and if you add all this together you can appreciate just how hard it is for many airlines to make ends meet.
I suspect that even the 2 leading low cost carriers could quickly start to loose money, if occupancy levels fall even slightly.
In short have the low cost carriers done the industry more harm than good?
My daughter is cabin crew at Astraeus, and like most of her colleagues is about to loose her job it seems, mainly because many airlines are finding it increasingly difficult to make money in the current market.
Reading through many of the airline threads there appears to be widespread dissatisfaction with nearly all carriers at the moment, much of which appears to be driven by the long hours, low pay and unfavourable shift patterns driven by the need to make money whilst offering very low fares.
As a businessman I must ask is it sustainable to offer £30 fares or lower on an aircraft that costs $100m, requires qualified crew for safety and of course must be fueled (ever increasing) and maintained to a high standard. Any delay requires pax to be accommodated at high cost, and if you add all this together you can appreciate just how hard it is for many airlines to make ends meet.
I suspect that even the 2 leading low cost carriers could quickly start to loose money, if occupancy levels fall even slightly.
In short have the low cost carriers done the industry more harm than good?
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I'm not going to suggest that the industry is perfect as a result of the low-costs. However, competition in the industry has ultimately been good for the consumer. Would you want to go back to the old "cartel" days where national carriers carved up the routes and charged a fortune?
Ultimately the 'low-cost' model will become the 'norm' for many routes where the full high-cost option simply isn't viable. Congestion and slot value at the likes of LHR will ensure retention of much of the "traditional" model, but outside LHR / London (let's use the North-West as a good example) the traditional carriers will withdraw (or already have), or adjust the product to suit. The product difference between BA Connect, MON, EZY, etc. is narrowing all the time.
And with the current fuel cost, the £30 fare isn't sustainable forever.....but even if in 2 years time we're discussing the "£60 fare" as being the norm, it's still a lot better for the consumer than the situation 15 years ago.
As for your daughter, a shame if she's impacted within a carrier that cannot justify retaining her......but look at the growth of the business over the years. Assuming she's based at LGW, I have no doubt she can pursue employment in an orange uniform if she wanted.
Ultimately the 'low-cost' model will become the 'norm' for many routes where the full high-cost option simply isn't viable. Congestion and slot value at the likes of LHR will ensure retention of much of the "traditional" model, but outside LHR / London (let's use the North-West as a good example) the traditional carriers will withdraw (or already have), or adjust the product to suit. The product difference between BA Connect, MON, EZY, etc. is narrowing all the time.
And with the current fuel cost, the £30 fare isn't sustainable forever.....but even if in 2 years time we're discussing the "£60 fare" as being the norm, it's still a lot better for the consumer than the situation 15 years ago.
As for your daughter, a shame if she's impacted within a carrier that cannot justify retaining her......but look at the growth of the business over the years. Assuming she's based at LGW, I have no doubt she can pursue employment in an orange uniform if she wanted.
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I think low cost operators have given the public what they want. I'm afraid it's just a case of changing and adapting with the wants and needs of the passenger.
Like it or lump it, we have to give the public what they want. The industry has to revolve around the passenger not the other way around!
Like it or lump it, we have to give the public what they want. The industry has to revolve around the passenger not the other way around!
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Ithinklowcostcarriersaregoingtokilleachothersbusiness. InsomecountrieslikeTurkeyairfaresarebecomingcheaperthanbustickets. Althoughthisisgoodforthecustomersbutforairlinesandairlineemployeesit’snot. Theairlinewillgettightwiththeemployeesandwilleventuallyrunoutofbusiness.
I don't think they have ruined the industry. I think they have ruined the image of the industry. It's like anything else that becomes cheap and nasty. Yes, it's cheaper to fly than to get the cab to the airport. Unfortunately that's what Joe Public wants. I think the really low cost bubble will burst and the wannabe's will go bust and fade. However, the big players will stay and mould the business to suit.
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I dont feel low-cost carriers have ruined the industry. I feel they have improved it massively over the last 10 years or so. Low cost fares have increased passenger numbers and enabled people with lower budgets to travel more often, and to more destiantions than the "bucket and spade" resorts. There is a market for both version of carrier "low-cost" and the so called "full-fare". What it has also brought is choice. Yes Ryanair may advertise £0.01 fares, but I would much rather fly Easyjet and pay a little more. Im also happy to pay "Full-Fare" to fly to destiantions at a time convenient to me, rather than take a "low-cost" flight that may be £150 cheaper but not get me to my destination at a time when convienient to me. Too much diversity can damage an industry. The indusrty at the moment is in a period of rationalisation. Carriers are being taken over, Easy buying GB Airways. Carriers such as Astraeus will have to find a place in the market, at the moment I dont think they, and carriers such as Monarch 'Fit' the industry at the moment, and they need to up there game, both in advertising and schedule/destinations to survive or be bought out by an established "Low-Cost" carriers.
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m500dpp you hit the nail on the head in your original post. You fly in machines that cost $100 million to buy, which are subject to the most stringent ongoing safety regulatory oversight, which are flown by the most highly-trained professionals, short of brain or heart surgeons, you will ever come across. You will take off and land at a facility the size and complexity of a small city.
And you expect to do it for £0.01 before taxes. Now tell me that makes economic sense. The whole LoCo model is built on sand.
That is not to say that LoCo airline 'A' doesn't have a business model that successfully takes care of all these considerations but you have to look beyond and behind the basic operating economics to see how they do it.
And you expect to do it for £0.01 before taxes. Now tell me that makes economic sense. The whole LoCo model is built on sand.
That is not to say that LoCo airline 'A' doesn't have a business model that successfully takes care of all these considerations but you have to look beyond and behind the basic operating economics to see how they do it.
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IMHO... the LCC's have opened more jobs for the Pilots, Engineers, Aircraft Mechanics and such... not to mention the effect it had on your day to day consumer... LCC's have opened doors for him to travel and go to places he couldn't afford way back when all airlines were Legacy Carriers...
It's all about how the LCC's operate and make use of their airplanes and how they utilize them... LCC's have given the consumer options... options on how to travel.. if you're on a budget or if you're going over the top... so it all depends on the consumers...
just my two cents worth...
It's all about how the LCC's operate and make use of their airplanes and how they utilize them... LCC's have given the consumer options... options on how to travel.. if you're on a budget or if you're going over the top... so it all depends on the consumers...
just my two cents worth...
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the LCC's have opened more jobs for the Pilots, Engineers, Aircraft Mechanics and such...
The future of small regional LCC's such as Globespan and Jet2 who are trying to gain some market mass may also be doubt as they are "sqeezed" out of the market...without turning this into a LBA v GLA "spotters" heated debate...
The choice of employers are shrinking with each summer season...
Good for:
Choice and price for consumers
The aircraft manufacturers, who have full order books
The airports, who are growing all the time
The industry, in that competition creates innovation and progress
The vastly increased number of people employed in the industry
Bad for:
Legacy carriers with high cost-base and complacent management
Employees who think they are 'worth' more than the market will pay
Unsuccessful entrepreneurs/investors who are trying to ride the trend, but will fail
Politicians who liked to control the industry through flag carriers
No effect on:
Safety
Choice and price for consumers
The aircraft manufacturers, who have full order books
The airports, who are growing all the time
The industry, in that competition creates innovation and progress
The vastly increased number of people employed in the industry
Bad for:
Legacy carriers with high cost-base and complacent management
Employees who think they are 'worth' more than the market will pay
Unsuccessful entrepreneurs/investors who are trying to ride the trend, but will fail
Politicians who liked to control the industry through flag carriers
No effect on:
Safety
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Wrt
Oh yes there is a potential effect on safety!... and to that end answer me this... i.e. how come when we took on the crews of what had been a low cost European carrier - the standards of operation we found amongst a good many (but not all) of its crew was quite appauling? So much so, that even after spending a small fortune on 'retraiing' them in the sim, some of them were dismissed?!
But then, such is the demand for pilots - much in part due to the growth of LoCo airlines - that some of these people have since been re-employed and are, this very day, flying around in the skies of Europe.
Imho, pilot training & standards are struggling to keep up with the growth.
No effect on:
Safety
Safety
But then, such is the demand for pilots - much in part due to the growth of LoCo airlines - that some of these people have since been re-employed and are, this very day, flying around in the skies of Europe.
Imho, pilot training & standards are struggling to keep up with the growth.
Puritan -
Thought that might be controversial
The way I look at it, aviation safety has been continually improving over many years, and the locos have not influenced any change in that trend. Looking at the time preceding the arrival of locos, there were some outfits whose activities may have been regarded as questionable. Even major international airlines have faced criticism over safety procedures following incidents or accidents.
The advantage the locos have had is access to brand new aircraft at a time of cheap and plentiful credit. So they are not generally operating ancient aircraft, but factory-fresh examples of the most recent technology. That helps them stay safe too.
In fairness, you did say 'potential', but then there's always 'potential' for everything....
Oh yes there is a potential effect on safety!
The way I look at it, aviation safety has been continually improving over many years, and the locos have not influenced any change in that trend. Looking at the time preceding the arrival of locos, there were some outfits whose activities may have been regarded as questionable. Even major international airlines have faced criticism over safety procedures following incidents or accidents.
The advantage the locos have had is access to brand new aircraft at a time of cheap and plentiful credit. So they are not generally operating ancient aircraft, but factory-fresh examples of the most recent technology. That helps them stay safe too.
In fairness, you did say 'potential', but then there's always 'potential' for everything....
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I think SSk has his head buried in the sand rather than the loco's buing built on sand.
Just remind me - how many European legacy carriers would have survived the last 10 years without subsidies from their Governments? (we'll keep BA out of this as they were floated long before this and dear Mr King did some naughites in the interim) KL? AF? SN? LH? AY? SAS? and of course, the most efficient one of all - Alitalia.
How many US legacy carriers would be flying today without the use of Chapter 11 and subsidies? Non.
What loco's have done is stopped the myth of avaition; that it was something special and wonderours. It is not, never has been. It is a means of transport.
Pay your money and take your choice.
Buy an old banger or drive your new Audi?
As with every product - and that is all that flying is - there is good and bad.
MoL and cohorts of the loco's are not perfect but they understand their businesses. History shows over many, many years that lots of individuals have started airlines only to go bust later. This will continue. The strong survive, the weak falter - unless helped.
Just remind me - how many European legacy carriers would have survived the last 10 years without subsidies from their Governments? (we'll keep BA out of this as they were floated long before this and dear Mr King did some naughites in the interim) KL? AF? SN? LH? AY? SAS? and of course, the most efficient one of all - Alitalia.
How many US legacy carriers would be flying today without the use of Chapter 11 and subsidies? Non.
What loco's have done is stopped the myth of avaition; that it was something special and wonderours. It is not, never has been. It is a means of transport.
Pay your money and take your choice.
Buy an old banger or drive your new Audi?
As with every product - and that is all that flying is - there is good and bad.
MoL and cohorts of the loco's are not perfect but they understand their businesses. History shows over many, many years that lots of individuals have started airlines only to go bust later. This will continue. The strong survive, the weak falter - unless helped.
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Excuse me, groundhand, I didn't say anything about legacy carriers and subsidy, but since you bring up the subject, perhaps you can give details of subsidies paid 'in the last ten years' to KL, AY and SAS?
Every passenger that the LoCos carry at below cost is being subsidised by somebody - the local taxpayers of Charleroi and elsewhere perhaps?
Every passenger that the LoCos carry at below cost is being subsidised by somebody - the local taxpayers of Charleroi and elsewhere perhaps?
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m500dpp, I don't normally post but I am sorry to hear about your daughter & I'd like to wish her my best. BA are recruiting cabin crew
I wouldn't blame low cost airlines for the changes to Astraeus. They have lost a lot of quality management recently. Fair competition is a good thing for all. Do you think that France, Germany, Italy, Greece are benefitting from their less competitive environment in the long term ?
I wouldn't blame low cost airlines for the changes to Astraeus. They have lost a lot of quality management recently. Fair competition is a good thing for all. Do you think that France, Germany, Italy, Greece are benefitting from their less competitive environment in the long term ?