Challenges Faced by Full Service Airlines
Topic: Challenges of full service airlines facing today
1. Introduction
Full service airline is defined as an airline that focuses on providing a wide range of pre-flight and onboard services, including different service classes, and connecting flights that are also operating a hub-and-spoke model (Reichmuth, 2008). According to Cento (2009), the core business of full-service carriers including passenger, cargo and maintenance.
In recent years, full service airlines are facing different challenges including the increasing competition, market shifts and the change of customer needs. This essay is to analysis the three main difficulties faced by full service airline and suggests some improvements.
2.1 Competition: Full-service airline VS Low-cost airline
The development of Low-cost airline is growing fast in recent decades and this is a big challenge to the traditional full-service airlines. Lau (2005) states that the characteristics of Low-cost airline including point-to-point short haul network, quick turnaround and high aircrafts utilization and seat density. Also, they do not have frills cabin, direct channel of distribution, streamlined organizational structure and operation. For example, Airasia. Different from the traditional full-service airline, low-cost airline emphasize on their low fare policy, which is very attractive to the price oriented customers. Therefore, the low-cost airlines enlarge their industrial market by their low-cost operating model and thus the market shares of the traditional full-service airlines are decrease. According to Gross & Lück (2013), customers are divided into two groups including people need to travel to certain destination and are looking for suitable means of transport. And the other group comprises those whose destination choice is primarily influenced by availability and provision of affordable transportation opinions to a set of destinations. The low-cost airline is very successful in attracting travellers from the
1. Introduction
Full service airline is defined as an airline that focuses on providing a wide range of pre-flight and onboard services, including different service classes, and connecting flights that are also operating a hub-and-spoke model (Reichmuth, 2008). According to Cento (2009), the core business of full-service carriers including passenger, cargo and maintenance.
In recent years, full service airlines are facing different challenges including the increasing competition, market shifts and the change of customer needs. This essay is to analysis the three main difficulties faced by full service airline and suggests some improvements.
2.1 Competition: Full-service airline VS Low-cost airline
The development of Low-cost airline is growing fast in recent decades and this is a big challenge to the traditional full-service airlines. Lau (2005) states that the characteristics of Low-cost airline including point-to-point short haul network, quick turnaround and high aircrafts utilization and seat density. Also, they do not have frills cabin, direct channel of distribution, streamlined organizational structure and operation. For example, Airasia. Different from the traditional full-service airline, low-cost airline emphasize on their low fare policy, which is very attractive to the price oriented customers. Therefore, the low-cost airlines enlarge their industrial market by their low-cost operating model and thus the market shares of the traditional full-service airlines are decrease. According to Gross & Lück (2013), customers are divided into two groups including people need to travel to certain destination and are looking for suitable means of transport. And the other group comprises those whose destination choice is primarily influenced by availability and provision of affordable transportation opinions to a set of destinations. The low-cost airline is very successful in attracting travellers from the