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How Low Cost Airlines Survive

HOW LOW COST AIRLINES SURVIVE INFOGRAPHIC ABOUT THE MAIN COST CUTTING STRATEGIES LOW COST CARRIERS TAKE OPERATING ADVANTAGES HIGHER SEAT DENSITY THE MORE PASSENGERS GET ON BOARD THE LOWER THE COSTS PER PASSENGER PER FLIGHT FOR THE AIRLINE. THIS IS TRUE ACROSS ALL COST CATEGORIES EXCEPT FOR FUEL - SINCE THERE IS AN INCREASE IN COST IF ADDITIONAL WEIGHT NEEDS TO BE CARRIED. 16 PERCENT COST REDUCTION COMPARED TO TRADITIONAL AIRLINES ON AVERAGE SMALLER AIRPORTS AND OPTIMIZED ROUTES LOW COST AIRLINES PREFER SMALLER CITIES IN ORDER TO KEEP THE AIRPORT FEES LOW. FURTHERMORE SMALLER AIRPORTS HAVE A SUBSTANTIALLY LOWER TRAFFIC VOLUME THAT ENABLES THE AIRLINES TO MAKE FASTER TURNAROUNDS AND THEREBY REDUCE TIME ON THE GROUND WHICH AGAIN REDUCES COSTS. ANOTHER IMPORTANT FACTOR IS POINT -TO -POINT ROUTES WITHOUT CONNECTING FLIGHTS. THIS IN FACT ENABLES THE CARRIERS TO PERFECTLY OPTIMIZE THEIR FLIGHT SCHEDULE AND AIRPLANE UTILIZATION WITHOUT TO BE DEPENDENT ON OTHER ROUTES OR AIRLINES. - STANSTED LONDON * REDUCED AIRPORT FEES * FASTER TURNAROUNDS * OPTIMIZED AIRPLANE UTILIZATION GATTWICK 6 PERCENT COST REDUCTION COMPARED TO TRADITIONAL AIRLINES ON AVERAGE LOWER FLIGHT AND CABIN CREW COST * SUBSTANTIALLY LOWER WAGES FOR AIRLINE STAFF 24 * MINIMUN EXPENDITURE ON AIRPLANE INTERIOR * REDUCED STAFF ON SERVICE COUNTERS * AUTOMATED PROCESSES E.G. MANDATORY ONLINE CHECK IN 3 PERCENT COST REDUCTION COMPARED TO TRADITIONAL AIRLINES ON AVERAGE SINGLE AIRCRAFT TYPE - FLEET WITH OUTSOURCED MAINTENANCE LOW COST AIRLINES RELY ON A HOMOGENOUS AIRCRAFT FLEET IN ORDER TO MAXIMIZE PLANNING FLEXIBILITY AND KEEP THE MAINTENANCE COST AT A MINIMUM LEVEL. GIVEN THAT ALL AIRPLANES ARE FROM THE SAME TYPE AND HAVE THE SAME TECHNICAL CHARACTERISTICS THEY CAN EASILY BE TRANSFERRED TO OTHER ROUTES OFFERED BY THE AIRLINE. IT IS ALSO CHEAPER TO MAINTAIN ONLY ONE SINGLE TYPE OF AIRCRAFT COMPARED TO A VERY DIVERSIFIED FLEET WHERE MANY TECHNICAL DIFFERENCES DEMAND A BROADER TECHNICAL MAINTENANCE SKILLSET. 2 PERCENT COST REDUCTION COMPARED TO TRADITIONAL AIRLINES ON AVERAGE DISTRIBUTION ADVANTAGES NO AGENT COMMISSIONS -6% SINCE NO TICKETS ARE SOLD VIA 3RD PARTY TRAVEL AGENTS REDUCED SALES COSTS:-3% GIVEN THAT ALMOST ALL MARKETING ACTIVITIES ARE DIRECTED THROUGH THE AIRLINES WEBSITE PRODUCT AND SERVICE ADVANTAGES LOW COST UNITED THIRD CLASS LOW COST UNITED Gate 19 Seat Gate Closes Gate Closes 20:42 278 Gate 20:42 19 Class THIRD CLASS Arrival Departure LONDON FRANKFURT 0187526644 REF No LCA7173748123123DIF THIRD CLASS 1U COMPLIMENTARY FOOD AND BEVERAGES NO COMPLIMENTARY NEWSPAPERS NO COMPLIMENTARY IN FLIGHT ENTERTAINMENT LOUCTION COSTA 5% NO COMPLIMENTARY BAGGAGE ALLOWANCE NO COMPLIMENTARY SEAT RESERVATION NO COMPLIMENTARY OVERALL LOW COST AIRLINES CAN REDUCE THEIR COST UP TO AROUND 50 PERCENT COMPARED TO TRADITIONAL AIRLINE COMPANIES SOURCES INTERNATIONAL JOURNAL FOR TRAFFIC AND TRANSPORT ENGINEERING, 2013, 3(1): 69 – 81 JOURNAL OF AIR TRANSPORT MANAGEMENT 15 (2009) 195–203 made with love for data and design by rightcolours. communication & design

How Low Cost Airlines Survive

shared by Rightcolours on Oct 21
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Infographic about the main cost cutting strategies low cost carriers take in order to stay profitable.

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Transportation
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