Know-How Exchange : Research/Metrics

Easy, Cheap trips = more people on the plane = better $ per litre of fuel. Also they make you pay to drink water, don't give meals and cut staffs pay, also they stopped paying commission to travel agents and get people to buy online.

I think all of the above are valid points, but if you look at the history of the airline industry, not all low cost carriers can maintain the momentum and make it past a few years. They either evolve or go out as the big established airlines try to snuff them out by getting very competitive on the routes that the low cost carriers use.

FireFox is essentially right, but it’s more complex than that. Yes they fill the planes and yes they charge for everything, including wheelchairs for the disabled of you use RyanAir. Oh and the airport taxes and fuel charges are rarely included in the tickets.

They also book almost exclusively via the internet and the price they charge varies with demand and varies by the minute. Whilst there are some fixed price tickets available, if you want to book well in advance, you get a medium priced ticket. As the departure date approaches, depending on the bookings, the price usually (but not always) falls. As the plane fills up, the price goes up again as people who are desperate to fly are willing to pay a premium. If the plane has seats left, the price falls, in order to extract every £ possible.

It’s based on an economic theory of auctions originally devised Alfred Marshall in 1890 and refined by Professor John F Nash who got a Nobel Prize for his work in 1994. Fisk’s work is more to do with game theory if you want to research it in more depth.

The same theory allowed the UK Government to auction off the 3G Mobile bandwidth for about £37Billion by making service providers bid through an auction. That’s about £20 billion more than they were thought to be worth. The auction process was devised by Professor Paul Klemperer of Oxford University and if you want to do your head in, you can read all about it in his Marshall Lecture in 2002 though strangely, he gives no credit to Fisk at all.

https://www.nuff.ox.ac.uk/users/klemperer/usingandabusing.pdf

Also don’t forget that if you are late, you lose your flight and your money as you do if you don’t grovel to the staff or if you complain about anything.

Steve Alker
Unimax Solutions

In addition, their management has learned from the macho mistakes of the legacy carriers. UA used to boast that they flew to all 50 states. Big Deal! If you're losing money, does it matter?

One of the things that has made Southwest so successful is that they go into a market and test the waters. When they meet a level of success, they grow in that market and continue to grow until they dominate. THEN, and only then, do they move into another city. Go back into history and you see, from the days of deregulation, the trunk carriers expanded into 25 cities at a time. Braniff filed for 659 new flights to begin the day after deregulation was past.

There's more. The LCCs also tend to go into airports which are screaming for service, so they get better support. You'd be surprised how much grief UA gets from the city of Denver, even though they are a dominant carrier, same as DL in Atlanta and NW in MSP and DTW. Lower landing fees and gate fees.

And, their employees are all cross trained. They can do any job in the line. Now, if you go to a line station (vs a hub) most carriers' staff are cross trained, but the bulk of personnel costs are in the hub stations where "it's not my job" is the standard response.

TWA ruined Ozark. Delta ruined Western and the beat goes on. Passenger transportation is a fascinating history and worth the time to read.

Michael

Southwest's success was also based on the fact they only served initially (and still do serve) secondary airports. So instead of Dallas-Fort Worth, they flew in and out of Love Field, a smaller and cheaper airport slightly closer to the city.

Read a book called "Nuts!" by Freiburg & Freiburg for all the inside Southwest start-up info.

In essence the low-cost airline model is all about finding the cheapest way to do things, cutting the price further and then making it as efficient as possible. I heard RyanAir is even ordering new aircraft without the window-blinds to save weight, and, therefore, fuel. Everything makes a difference, no matter how small.

HEY
FIRE FOX i think you were catching up pretty well
but we lag the data i.e. suppose if a ticket of southwest cost $50
then
compared to the normal legacy prices
of $300(suppose)
then we actually SAVED
10% -- turn around time
20% -- food
5% -- crew staff ( cross trained )
.
.
.
right !!!!!!

SO WHAT WE NEED IS DATA LIKE THIS WHICH WE CAN
ACTUALLY PROOF ON

what the Question wants is the data how were they able to cut off so much prices

AND WHAT WERE THERE % OF THE CUTT OFF s

Well to say it straight
STRATERGIES ARE KNOWN TO EVERYONE

Yes ofcourse
WE can save cost on
1> eatables
2>crew cabinet
3>secondary airports
4> having more occupancy
5>less turnaround time
6>short flights
7>SMALL N more seats

n many more
BY how much% does each factor have an effect over the cost of ticket

Aw, Carrie!

Can’t you charge the guy a few points for poor spelling, bad grammar and SHOUTING?!

Regards

Steve