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End of the free lunch? The responses of traditional European airlines to the low-cost carrier threat

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  • Dennis, Nigel

Abstract

The short-haul operations of traditional European airlines such as British Airways and Lufthansa have come under increasing pressure from the growth of low-cost carriers. This paper examines their competitive responses. These are found to include reductions in labour costs, greater use of regional aircraft and a run-down of secondary hubs. Minimum stay requirements on cheap fares have been axed in many markets, while changes to the on-board service and a move to direct-sell bring these airlines closer to the low-cost carrier product. The network strength is largely maintained, however, which appears a better strategy than setting up a low-cost subsidiary.

Suggested Citation

  • Dennis, Nigel, 2007. "End of the free lunch? The responses of traditional European airlines to the low-cost carrier threat," Journal of Air Transport Management, Elsevier, vol. 13(5), pages 311-321.
    • Handle: RePEc:eee:jaitra:v:13:y:2007:i:5:p:311-321
    DOI: 10.1016/j.jairtraman.2007.04.005
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    References listed on IDEAS

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    4. Lindstädt, Hagen & Fauser, Bernd, 2004. "Separation or integration? Can network carriers create distinct business streams on one integrated production platform?," Journal of Air Transport Management, Elsevier, vol. 10(1), pages 23-31.
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