Change is afoot in the European regional airline sector, it would seem. Gone are the days of the “us and them,” with the regionals on one side, the major airlines on another and the low-cost carriers playing the role of bad-boy upstarts.
Indian airlines are facing stiffer competition and downward pressure on air fares with 40 new aircraft due to join the country’s fleet, taking the total capacity to around 400 jets by year-end. Existing carriers are now facing new competition in the shape of AirAsia India, which has just received its air operator permit (AOP) for domestic services.
With many of Europe’s regional airlines feeling unloved and forgotten by the central powers, ERA director general Simon McNamara has spent much of his first year visiting as many airline members as possible to understand how they tick, and what challenges they face. “We’ve put a lot more focus on the membership,” he told AIN. “And we are trying harder to let our members know what we’re doing and why.”
The European Commission on Thursday adopted new guidelines for limiting state aid to regional airports and airlines, a move the EC claims will reduce competitive distortion by discouraging overcapacity at small, unprofitable facilities.
Low-cost carriers (LCCs) have succeeded in Southeast Asia more than in perhaps any other part of the world. Whereas LCCs carry around 26 percent of global traffic, in countries such as Indonesia, Malaysia, Thailand and the Philippines that figure has exceeded 50 percent. With China’s skies being opened to LCCs the expansion in the Asia Pacific region is set to carry on.
New relationships are changing the Asia Pacific’s airline landscape as it enters a new stage of maturity with once-fierce opponents forming partnerships for reciprocal gains. Overcapacity in fleet numbers has fueled competition and compelled budget carriers to look at cooperation initiatives despite the budget airline industry’s penchant to avoid complexity.
World airlines collected $27 billion in revenue from products and services other than ticket sales last year, according to the latest annual report by research company IdeaWorks. The total came from data from 53 airlines that disclose ancillary revenue activity.
U.S. airlines have managed to stay profitable during a period of recession and spiking fuel prices, but small- and medium-sized airports have paid the price in reduced domestic air service, according to a Massachusetts Institute of Technology (MIT) study.
Irish low-fare carrier Ryanair on Tuesday committed to buying 175 new Boeing 737-800NGs worth nearly $15.6 billion at current list prices. The deal, still subject to confirmation, supports Ryanair’s plan to expand the size of its uniform fleet of 737-800s from 305 to some 400 airplanes and serve more than 100 million passengers per year across Europe by the end of the delivery stream in 2018.
Both in terms of actual cost structures and customer perception, the line between low-cost carriers (LCCs) and so-called legacy airlines has blurred, according to a new report from accountancy group KPMG. The company’s 2013 Airline Disclosures Handbook, published on March 12, showed that the cost gap between LCCs and legacy operators dropped by more than 30 percent between 2006 and 2011, falling from 3.6 U.S. cents to 2.5 cents per available seat kilometer (ASK).
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