Home > Home > Hybrid airlines edging out traditional LCCs: Sabre

Hybrid airlines edging out traditional LCCs: Sabre

05/12/2008| 6:22:00 PM| 中文

Published: 09 May 2008:A new breed of "hybrid" carrier is quickly overtaking traditional low-cost carriers (LCCs), according to a study released today by Sabre Airline Solutions.

Published: 09 May 2008:A new breed of "hybrid" carrier is quickly overtaking traditional low-cost carriers (LCCs), according to a study released today by Sabre Airline Solutions.

The global study of 540 airlines revealed that out of 123 self-nominated LCCs, 59% had added enough complexity to their business model in recent years that they had now evolved into a full-service airline (7 %) or were part of an emerging breed of "hybrid" carriers, which blend low-cost carrier traits with that of full-service carriers (52%).

Only 41% retained true LCC characteristics including point-to-point routes, single aircraft types, single cabin configuration, simple fares with no interline or code share agreements and direct distribution usually through the Internet. Furthermore, passenger numbers from 2007 show that these "hybrid" airlines carried 64% of all passengers in the broader LCC segment.

Gordon Locke, vice president of Airline Marketing and Strategy for Sabre Airline Solutions said, "The LCC market is one of the most competitive in the airline industry and this has spurred many pure LCCs to explore new ways of evolving their business to remain competitive and sustainable. For many, this has meant adopting some full-service carrier business practices to help grow their passenger base and expand their market reach, although they have often added their own twist on how these business practices are implemented."

The study shows that full-service carrier attributes being introduced by LCCs include: international routes, use of the global distribution system (GDS), codeshare agreements, connecting services, multiple fares available at any time, advanced ticketing procedures, multiple aircraft types, multiple classes of service, interline agreements and long-haul destinations.

"Airlines that introduce more than three of these full-service characteristics should be considered a hybrid carrier because each attribute adds a level of complexity and cost to the operating model that is inconsistent with the fundamental principles used to define low-cost carriers," said Locke.

Based upon this, within North America, low-cost airlines that may be considered "hybrid" carriers include industry leaders like Southwest Airlines, JetBlue, WestJet and AirTran Airways. Globally, the trend is just as strong with European carriers like easyJet, Germanwings, Norwegian Air Shuttle, bmibaby, Sterling Airlines, KDAvia, Centralwings, Blue Panorama Airlines and Flybaboo taking on "hybrid" characteristics. In Asia-Pacific, Virgin Blue and AirAsia also fall into this new category.

"Many of these airlines have evolved into a ´hybrid´ carrier in order to make a play for the highly lucrative business traveler, who has a completely different set of needs and shopping behaviors from the leisure traveller that LCCs have traditionally targeted. That´s why some have introduced GDS distribution, multiple products, new classes of service and interline agreements. They´ve also invested in sophisticated revenue management tools and techniques that help them maximize the revenue generated by every seat on every aircraft, every day of the year," Locke said.

"In comparison, pure LCC airlines don´t use these tools. They stay true to the LCC model – a simple, no-frills offering using discounted airfares to appeal to a single travel segment, in this case the price-conscious leisure traveler," said Locke.
TAGS: Sabre | LCC | hybrid carrier
©2016 广州力矩资讯科技有限公司 粤ICP备06070077号-2
Tell us more about yourself!