low-cost airlines in Asia

Profile picture for user cloud_9

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14 years

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As most of you know, Asia has been experiencing a huge increase in the number of low-cost airlines setting up...but the question I ask is can these airlines be success or not? Has anyone got any opinions?
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Profile picture for user murph

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14 years 8 months

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Singapore has just built a dedicated low cost terminal, you may want to do some research into that and the associated low cost boom that Asia has experienced. Sadly I have little opinion, only studied the rise of EU based airlines, and Southwest in the US!
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19 years 9 months

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The markets in which LCCs have been most succesful have been the most deregulated, and currently Asia does not have that luxury. They trade in competitive markets, and in my view they ideally they need to be: 1. Free of bilaterals and other capacity/price constraints; 2. Free to move into and out of markets which are not proving succesful, in heavily regulated markets entering and exiting markets is not so simple; 3. In markets where competing airlines are not subsidised and held up by governments because these markets are distorted. Other problems in Asia include the distances between major centres, and the result of this means that the major carriers tend to use widebodied aircraft, which offer economics that traditional low cost aircraft types simply cannot match. In addition the distances covered by these flights means that many passengers want complimentary food/drink/ents. HOWEVER, I think there is potential in Asia for several reasons: 1. There is a growing middle class in many countries, which have growing disposable income, and an economic effect of that is the desire to travel; 2. The markets are gradually becoming more liberated, and will help meet some of the criteria in which I believe LCCs must operate. 3. The LCC model has been well proven elsewhere, in markets which had a lot of competitors, in Asia due to the regulated markets there is very little competition against flag carriers, and when deregulation takes place it should be boom time for the LCCs because there will be very little competition. 4. The surface transport infrastructure is very basic in many countries, and so air transport can offer a fast, relatively cheap alternative. Hope this gives you a few ideas to think about. I can write more if you like.
Profile picture for user cloud_9

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Hope this gives you a few ideas to think about. I can write more if you like.
Fancy doing my research for me...? :D (only joking!) I would be very interested to hear what else you have to say, so please PM me with the rest of your thoughts. My opinion is that because the success of low-cost carriers has been echoed in other regions of the world, there should be no reason why areas within Asia cannot develop a successful low-cost market. However, they can only be a success if they ensure that they can maintain the lowest possible operating costs, compared to the already price competitive, full service carriers. Anyone else got an opinion? Has anyone flown with a LCC in Asia? If so, what is it like, and are there any differences compared to other low-cost markets?

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13 years 8 months

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low cost carriers have only been successful in truely deregulated markets and asia is not even close, years of protectionist air service agreements to protect the legacy carriers like Cathay Pacific and others have menat that there are only a small number of routes that low cost carriers can fly and if more than one of those set up on any particular route then all that will happen is these carriers fly with losses or they end up merging, this has recently happened in singapore where jetstar asia (which was supported by qantas) and valuair merged as they found they just couldnt compete.
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[QUOTE=airportsexpress]low cost carriers have only been successful in truely deregulated markets and asia is not even close, QUOTE] Thats two of us saying that now. I really think you need to focus on this issue, do some work on the growth of LCCs in Europe and the US, and highlight the points of deregulation, then move the principle across to Asia, and look in depth at the regulations in Asia.
Profile picture for user cloud_9

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14 years

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Thanks for all your help, have finished the project for now, will feedback on my results if you want?