Low-cost airlines gain 30% market share

Don Schmincke is an author who used to fly United Airlines first class and other big airlines. But he had to change his habits and has to use low-cost carriers because their flights fit his schedule. What is more Schminckeis is not the only person who altered his privileges concerning airlines.

Low cost big airline companies among them Southwest, AirTran and JetBlue as well as small ones like Frontier, Spirit, Virgin America and Allegiant have enlarged for the last 10 years due to United and other major carriers such as Delta, American, Continental and US Airways.airplane-view-cyprus

According to Dan Kasper, aviation economist at LECG, “the deep-market penetration by the low-cost carriers” is considered to be the main thing occurred in the airline industry over the past decade.

One should say that the regrouping led to high fuel costs and a recession-forced slump in travel and as a result conventional airlines had to pay extra expanses. Moreover, only low-cost airlines earn constant profit and besides expand their routes.

Low ticket prices are considered to be the evident appeal of the discount airlines. According to Massachusetts Institute of Technology’s Airline Data Project low-cost airlines manage about 30% of the USA’s domestic air travel market at present but the percentage was much lower if refer to the year of 1999, i.e. under 10%. But still such carries as Delta, American, United, Continental and US Airways provide more seats at discount prices in comparison with the low-cost carriers.

Because of diminished spending on domestic air travel the situation became worse in America. According to some figure the ratio dropped to an all-time low – 0.51% of GDP. One should admit that that the fall in the ratio started in the third quarter of 2001 after the Sept. 11 attacks happened. MIT’s Airline Data Project database shows that the highest ratio was in the second quarter of 2006.

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