Low Costa Air Companies and their Fame
Today, many are already familiar with the concept of low cost areas, but we do not always know their history, and what should have been due to its appearance.
A low cost, or low -cost companies, is an airline that offers considerably lower prices than competition, manage to reduce their prices by eliminating some traditional services that conventional airlines offer, services such as you can see a free food trayIn during a flight, the free choice of our seat, the billing of suitcases in the cellar, among others.either…
But how did these companies arose and when? After World War II, the amount of the planes that left over having already fulfilled their function in the war, were reused and reconditioned to become commercial use aircraft.
The first company that raised lower costs than its competitors was the Pacific Southwest Airlines company, which operated from 1949 to 1988; some remembered it remembered for having the famous fleet of airplanes with a smile at Puntael Morro, and having to deuse theSlogan "The most friendly airline in the world".
Not yet considered a good one was a very good business strategy, low cost companies did not appear in Europe until the 190s, when finally, thanks to the deregularization of air transport, the supply market could expand and end the monopolyof traditional companies. They took their appearance but not to expand rapidly in Europe and in the rest of the world, since they were companies with a totally new but very attractive strategy for investors who saw the growing potential demand.
The first European company company to enter the air market was the Ryanair airline, nowadays considered as the market leader., It was founded was founded in 1985., closely followed by companies, the Norway Norwegian Airlines would then emerge in 1993 and the Easyjet company in 1995.
The operation of a Low Costa airline and its strategy are very different from those of a traditional company, which we will analyze later in a DAFO analysis, but it is worth highlighting their creativity they have, and as they have known how to take advantage of what they did not contributeThe air market until now, that is, short routes, but more numerous, and to cities and countries that did not give this possibility previously.
This business model can afford to offer these low prices for the elimination of many costs for services that do not provide (or provide them with additional charges the price of the ticket), and know how to reduce costs in other aspects. As areas of the business.
- One of the aspects that allows them to save and reduce their costs considerably is due to the use of secondary airports. These airports allow them to pay less lower airport rates, having the same facilities and services as the main ones, and being normally further away from the city that serve..
- To have to pay even less airport rates, Low Cost companies program many routes per day, and therefore their stay on land at airports is usually very short, thus allowing another savings. In addition they usually perform only direct flights, without scales, to avoid unnecessary stays, since the more time they spend more money, the more money they lose..
- The design of the fleet of airplanes that they have is usually unique, only one size, depending on the airline can be Airbus or Boeing, and the most important thing for them is that the largest possible number of possible seats can be concentrated on the plane, forPower in this way sell more seats and get higher income with the same fixed cost. By introducing more seats, the comfort that traditional companies can give to be more spacious is eliminated.
- They eliminate the cost of an intermediary as travel agencies, selling their tickets directly and only via the Internet, and carry out online billing, thus reducing the personnel they need on land.
- If any passenger looks for some kind of greater comfort, you must pay a supplement for it, such as being able to choose your seat on the flight, eat something on board, enter the plane before, etc.s ..
Despite reducing so many services, one could think that these models are not well received by society, but, on the contrary, they have shown that, in most cases, people prefer to deprive them of some privileges with such powerAllow more affordable plane tickets and with a range of broader routes possibilities. This new business model was especially well received at first by middle-low-class people, who could finally travel as we can observe in the graphics below: There have been more passengers on Low Cost companies flight(55.8%; (Turespaña, 2018) than in traditional companies (with 44.2%).
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