Low-cost airlines: Making Laker’s dream come true

SIR FREDDIE LAKER, the pioneer of cheap “no frills” transatlantic flights in the 1970s (pictured), could not make his ventures succeed. But he did inspire the low-cost carriers that have brought affordable air travel to the masses over the past 15 years or so. Ryanair of Ireland is now the world’s biggest international airline by passenger numbers, carrying 81m people last year. Budget airlines round the world, from Southwest in the United States to AirAsia in Malaysia, have succeeded where Laker failed by sticking to shorter routes.Subsequent attempts to apply the low-cost model to long-haul routes have flopped as badly as Laker. Oasis Hong Kong Airlines went into liquidation in 2008, a year after starting cheap long-haul flights to London and Vancouver. More recently, AirAsia’s sister airline for longer flights, AirAsia X, abandoned its attempts to run budget flights to Europe. The incumbent full-service airlines have lost much of their short-haul business (flights of up to three hours or so) to the low-cost carriers, but they continue to dominate the skies on the longest routes.However, a number of airlines in Asia, AirAsia X among them, have continued to test...



from The Economist: Business http://ift.tt/1FvK3Du