Network Carriers’ Strategic Decision with Low Cost Carrier Entry

Good decisions require that each decision-maker accurately predicts the strategic moves of the other parties. Dealing with prospective low-cost carrier (LCC) entrants is critical for global network airlines. This research focused on two main issues. First, it investigates competitive reaction by established US airlines when they face an LCC entrant in the less congested, small-sized US regional airports. Second, it examines which of the market indicators are most likely to influence airline fares out of small regional airports with the LCC entry. While the first stage of research demonstrated mixed results and did not discover any patterns in airline behaviour with LCC entry due to a large number of other variables influencing airline revenue management. The second stage confirmed that the stage length, number of passengers, number of competitors, number of stops and the oil price do have an impact on airfares

How High Will Russian Aviation Fly?

The study provides the historical context of the Russian aviation industry reflecting the periods of its growth and decline. It reveals the competitive advantage strategies that have been implemented by the Russian government in an attempt to revivify an enfeebled nation\u27s aeronautic industry. The paper discusses the newly formed Joint Stock Company (JSC) United Aircraft Corporation (UAC) and its strategies to break into global markets, including UAC innovative product offerings. Whether or not, the recent efforts of the Russian government serve as a fulcrum for the Russian aviation industry that will leverage Russia into the global market, remains to be seen

The Challenge of Intervention to Monetarily Support or Not Support the National Airline Carriers: A Case of the Airline Industry in Eastern Europe

The airline industry has been considered a special case in national and international business virtually since its beginning. Because of this status, national governments have repeatedly intervened to support national carriers in order to prevent bankruptcy and failure. The nations of Eastern Europe are no exception to this rule and are currently considering additional intervention to support their carriers. This paper explores the rationale for intervention, particularly the suggested economic impact, using traffic and financial information from the Flightglobal database. The conclusion is that the case for intervention is weak at best and that the results may not justify the expense

Regional Jet Aircraft Competitiveness: Challenges and Opportunities

The Purpose of the Study is to investigate the current trends in the aviation industry in regards to regional jets and to examine country-level factors that can potentially explain the number of Embraer and Bombardier regional jet deliveries. Possible factors include GDP, price of crude oil, prior aircraft deliveries and the land area of receiving RJ countries

Ancillary Revenue and Price Fairness: An Exploratory Study Pre & Post Flight

The growing impact of Ancillary Revenue on consumer choice and shopping behavior continues to be a highly debated issue. In the US, the Department of Transportation (DOT) has stepped into the debate and is investigating the possibility of new rules on how airlines must report and display such ancillary offerings. While the DOT collects data, reports on the amount of ancillary revenue earned by the airlines continue to rise. Examining past research on price fairness from the marketing literature and the impact of revenue management on price fairness from the aviation literature, this article joins new research appearing on the impact of a la carte pricing and ancillary revenue on perceptions of price fairness. This study focuses on the issue of price fairness pre and post flight and how ancillary price offerings are communicated to consumers when purchasing airline services

Analysis of Low-Cost Carriers in the Post-Soviet States

The research paper provides an overview of low-cost carrier (LCC) development in the post- Soviet states with the analysis of the largest aviation market in Russia. The LCC model seeks to achieve a competitive advantage through the reduction of operating costs below the traditional airline model. Since the post-Soviet states are emerging economies, airlines face a high level of uncertainty and experience a number of unique problems. While the global community enjoys the benefits offered by LCCs, the question remains why this model has not been successful in the 15 newly formed countries, with the exception of the Hungarian low-cost subsidiary Wizz Air Ukraine. Convenient geographic location, large population with comparable GDP per capita, high levels of tourism, and good transportation infrastructure make this market very attractive for domestic and foreign-based LCCs. The research addresses strategies employed by airlines, as well as the challenges and opportunities. The airline classifications and data is collected using the Flightglobal database. Future strategies, including government legislation, are discussed in order to promote the LCC business model as a successful option to compete in these markets

The Model of Network Carriers\u27 Strategic Decision Making With Low-Cost Carrier Entry

After deregulation in the United States in 1978, airlines faced intense competition on previously regulated routes. The proponents of deregulation stated that equilibrium in the industry would be achieved by providing lower fares and improved service (Daraban and Fournier, 2008). While this became true to some extent, the airline network in the U.S. was dominated by the hub-and-spoke system and concentrated in the hands of few large airlines. The emergence of the Low-Cost Carrier (LCC) model, which originated in the U.S. through Southwest Airlines in the early 1970s, became an instrument to drive the airlines towards a competitive equilibrium. The LCC model was later adapted by the European market with the Irish carrier Ryanair in 1991, followed by the U.K.-based easyJet in 1995… --Introduction

Overview of Low-Cost Carriers in Russia and Post-Soviet States

The low-cost carrier\u27s model made remarkable gains across the globe in the prior decade, although growth was uneven domestically and intraregionally. Within this region, there are significant differences in overall country size, the size of the domestic aviation market, and the number of carriers serving the market. The largest and most developed market is in Russia, but rest of the region also experienced growth in economy airlines\u27 activity as they discovered the power of the model to expand aviation access and lower costs. The success of low-cost carriers, however, has been halting and hampered by government decisions on foreign investment, ownership, and leasing. Still, some carriers have been able to grow and achieve gains over rivals. The recent Russian-Ukrainian war has further complicated the situation

Customer Relationship Management: A Theoretical Overview and the High Cost of Failure (a Case Study)

Despite the significant benefits offered by the customer relationship management (CRM) strategy together with advanced technology, there is still a high rate of companies who fail to see results promised by CRM in order to achieve a competitive advantage. A review of the empirical literature together with the case study of the CRM implementation within a midsize financial firm will result in deeper understanding of current CRM practices that could contribute to better planning, selection, and implementation of customer relationship management programs