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Measuring the LCC effect on charter airlines in the Spanish airport system

Author

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  • Castillo-Manzano, José I.
  • Castro-Nuño, Mercedes
  • López-Valpuesta, Lourdes
  • Pedregal, Diego J.

Abstract

Using a robust transfer function model methodology, the present paper seeks to offer empirical evidence regarding the size and type of effects that low-cost carriers (LCCs) have had on traffic for charter carriers (CCs) in the Spanish airport system by geographic market. We show an unmistakable substitution relationship between CCs and LCCs in the latter's typical niche markets, national and European flights, while there is no reaction from the CCs in the segment of international flights outside the EU. Furthermore, substitution effects are smaller between CCs and LCCs on the domestic level than effects between LCCs and network carriers (NCs) and slightly larger on the European level. Lastly, CC traffic's different sensitivity to terrorist attacks, day of the week, air accidents and the economic crisis is also evident. CCs should therefore be considered an independent category that warrants individualized analyses.

Suggested Citation

  • Castillo-Manzano, José I. & Castro-Nuño, Mercedes & López-Valpuesta, Lourdes & Pedregal, Diego J., 2017. "Measuring the LCC effect on charter airlines in the Spanish airport system," Journal of Air Transport Management, Elsevier, vol. 65(C), pages 110-117.
    • Handle: RePEc:eee:jaitra:v:65:y:2017:i:c:p:110-117
    DOI: 10.1016/j.jairtraman.2017.09.007
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    Cited by:

    1. Castillo-Manzano, José I. & López-Valpuesta, Lourdes & Sánchez-Braza, Antonio, 2018. "When the mall is in the airport: Measuring the effect of the airport mall on passengers’ consumer behavior," Journal of Air Transport Management, Elsevier, vol. 72(C), pages 32-38.
    2. Jose I Castillo-Manzano & Mercedes Castro-Nuño & Lourdes Lopez-Valpuesta & à lvaro Zarzoso, 2021. "Quality versus quantity: An assessment of the impact of Michelin-starred restaurants on tourism in Spain," Tourism Economics, , vol. 27(5), pages 1166-1174, August.
    3. Oliveira, Bruno F. & Oliveira, Alessandro V.M., 2022. "An empirical analysis of the determinants of network construction for Azul Airlines," Journal of Air Transport Management, Elsevier, vol. 101(C).

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