The economic viability of long-haul low cost operations: Evidence from the transatlantic market

De Poret, M., O'Connell, J.F. and Warnock-Smith, David (2015) The economic viability of long-haul low cost operations: Evidence from the transatlantic market. Journal of Air Transport Management, 42. pp. 272-281. ISSN 09696997

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Abstract

The recent strong performance of long-haul low-cost carriers AirAsia X and JetStar have re-raised the question of the long-term feasibility of long-haul low-cost operations. For the first time, this study contains a detailed financial assessment of low-cost operations on the transatlantic market using best-in class aircraft technology, the Boeing 787. The study's main findings demonstrate how challenging the successful running of a European long-haul low-cost carrier can be. In particular, on-going operating profit appears to be very sensitive to variations in demand and fuel prices, despite the use of new, highly efficient B787s. The findings show any prospective long-haul low-cost carrier that pursuing a demand focussed network strategy can ensure financial viability. This involves the creation of higher seating densities, higher cargo revenues and additional ancillary revenues

Item Type: Article
Keywords: Low-cost carriers, Long-haul operations, Financial viability, Transatlantic market, Ancillary revenues
Depositing User: RED Unit Admin
Date Deposited: 23 May 2017 10:11
Last Modified: 11 Mar 2020 12:17
URI: http://bucks.repository.guildhe.ac.uk/id/eprint/15724

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