Airline Competition

http://www.cnn.com/2016/03/20/aviation/budget-airline-trends-2016/

The article connected to the link above talks about the airline industry and what the next game changer will be for that industry. The pioneers of low cost flying took the industry by storm and changed the way airlines looked at their customers. By taking away all the non-essential extras and marketing it well, airlines were able to attract customers like never before. However, as economic conditions improve, we can see both low cost airlines and legacy airlines, airlines with all the high ends met, coming toward the middle of the line. For example, low cost carriers have begun to create bundles that allow passengers to purchase higher end packages for their flights and have created membership programs that many legacy airlines have. With low cost airlines moving closer to legacy carriers, there is additional pressure on high-end carriers, and with this additional pressure, legacy carriers are beginning to move toward more competitive prices and some complementary luxury items being cut. One key item that will eventually happen is the mergers and acquisitions of many airlines to form conglomerates that can operate across an array of income classes, distance, and luxury items. Ryanair, who is Europe’s low cost airline, has begun to talk about merging with TAP and Norwegian Air Shuttle to expand to other markets through the possible mergers.

This article relates to the chapter on Tourism Marketing in a number of ways. Primarily, the airline industry is at the edge of another change, and as these airlines begin to change to a hybrid between legacy carriers and low cost carriers. As the current airline carriers are beginning to think about this change, all of them are looking at their advantages and disadvantages with competitors and many are considering their strengths, weaknesses, opportunities and threats. In respect to the low cost carriers, they have the strength of being cheap, their...