EssayClub.com - Free College Essays and Term Papers

Strategic Business Analysis

Introduction
Low-cost carrier, is so-called no-frills airline or budget airline is an airline that adopts the low cost strategies in all respects of business, such as the opening of airlines, choice of secondary airport, ways of selling tickets, and on-board service. For instance, single type of airplane, simple fare scheme, direct sales of tickets, unreserved seating, without many traditional passenger services, use secondary airport, short flights, fast turnaround times, simplified routes with point-to-point transit, low labor cost with multiple roles and etc. Such a strategy will cut down the price to a lower level and then the cost they have saved will benefit the passenger, and it will help to achieve the win-win aspect. Low-cost carrier had changed the traditional idea of air travel, is a high level of consumption, into a speedy and economic air travel. The concept originated in the United States, follow by Europe and subsequently to Asia.

Not every low-cost carrier implements all of the above strategy. Some try to differentiate themselves with allocated seating, while others operate more than one aircraft type, still others will have relatively high operating costs but lower fares. Nonetheless these are general characteristics, most of which apply to any given low-cost carrier.

Most successful low-cost carriers try to offer a modicum of additional benefits, such as better on-time performance or more legroom. AirTran Airways has been very successful with its low-fare Business Class, while Frontier and JetBlue offer live in-flight television. US Airways offers a first class product, and a very extensive route network including international destinations.

The first successful low-cost carrier was Pacific Southwest Airlines in the United States, which pioneered the concept when their first flight took place on May 6, 1949. However, Southwest Airlines that began service in 1971 and has been profitable every year since 1973. With the advent of aviation...