Britain has a history of small challenger airlines, beating against the door of the establishment and opening new markets. We have seen these come and go over the years – British Caledonian/Caledonian, British Midland, Air UK and Air Europe, all household names at points in time. In several industries, most notably in banking, new challengers are appearing with a fresh outlook based upon service and technology to suit the ever changing needs of the consumer.
The gap between ‘low cost carriers’ and the ‘legacy airlines’ is shrinking. While LCC’s are concentrating on network coverage and growth, along with costs, legacy airlines are scaling down to meet the new expectation of airfares. The has left a gap in the market, for people who are willing to pay a premium for quality, but with the efficiency and service of a younger challenging brand.
The ‘downgrading’ of British Airways on short haul has alienated many of its loyal following, who now compare their experience to easyJet. While that isn’t necessarily a bad thing, many see differently and should be providing those extras – even if it is just a cup of tea and a biscuit in economy. Recently, the IT nightmare showed how fragile they can be when there is a problem, without the resources to sort it out.
What I would suggest is what we have seen in the US, a number of airlines born in the ‘low cost’ era have bucked that trend, albeit with various levels of success to show that you can create a brand and airline which customers love, and come with little baggage. The first, Jetblue has enjoyed success on the east coast at bases in Boston and New York built upon less densely configured aircraft (although this is changing), decent customer service and product which resonates with customers. The other being the now Alaskan owned Virgin America whom have enjoyed a loyal following in the bay area, the trendy interior and innovative website and product offering appealing as a viable alternative to the mainline carriers on trunk routes.
Europe doesn’t have an airline which resonates as positively, with negatively still surrounding the previous and more basic offering by easyJet and Ryanair, and the push back of cutback at mainline carriers.
Can such an airline exist though? It would need low costs and slots at important airports – something which easyJet and Ryanair have been busy gobbling up over the last few years, along with other airlines such as Vueling and Norwegian. That is to say it isnt impossible, especially if it was born out of a merger or takeover, with a fresh and different view of how people travel today.
So the question is, can you do premium on the cheap??