Budget Airline Model

Budget Airline Model

  • Submitted By: choujou
  • Date Submitted: 02/05/2010 1:28 AM
  • Category: Business
  • Words: 771
  • Page: 4
  • Views: 784


Budget airline model is profitably used by low-cost carrier, also known as no-frills/discount carrier, that generally offers low fares but with the exemption of offering the traditional passenger services such as free meals and complementary drinks. The concept of budget airline was coined in 1971 by and who introduces the concept of ticketless airlines. However, the credit is said to have been incorrectly given to Southwest Airlines since it was in 1949, emerges the first ever successful low-cost carrier, the Pacific Southwest Airlines. Further, with the deregulation of aviation, the budget airline model spread to Europe in which, the most notable was that of the Ireland’s Ryanair that started its operations back in 1991 and the EasyJet four years after.

The budget airline model is entirely different compare with that of the traditional airline model. To account one difference, for instance, is the difference in the pricing model they employ. Airlines like the British Airways profited those early bird booking through reduction on the prices as the date of travel approaches, whereas in the budget airline model, profited those who booked early by raising the prices as the date of travel approaches. Moreover, other diffrentiating characteristics of a budget airline model are that they have a single, one class passenger class, a single type of airplane used (the Air A320 or Boeing 737 models are commonly used), the non-issuance of tickets that denotes the concept of “ticketless” airlines, a simple fare scheme, unreserved seating that describes the short check-in time, utilizes less congested secondary airports, offers simplified routes with emphasis on point-to-point transit instead of the hubs, the employing of direct selling via the internet, ergo, avoiding add-on fees and payment of commissions to travel agents or the computer reservations systems, employees and crews doing multitasking and lastly, budget airlines do...

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