Low Cost Carriers

Tag Archives for Low Cost Carriers.

The era of fare unbundling is about to hit full service carriers

Christoph Müller is an interesting man, the new CEO of the troubled Malaysia Airlines has always been known as a ‘terminator’ for his skills related to cost cutting by trimming workforce and brining airlines back to profit. He has done this successfully with Aer Lingus and Sabena in the past and he has already started that process at Malaysia Airlines by letting go almost 6,000+ employees of the airline. What’s really catching the eye though is his statements this week at the IATA Annual General Meeting in Miami about turning the airline into a “value airline” for its customers by offering customized unbundled fares where customers have a choice to choose what all features they and what they don’t. He has discussed about unbundling business…

Continue Reading »

“Scoot” will it prove to be a game changer?

Finally the talk of the town has become a reality, Singapore Airlines unveiled its Long Haul Low Cost Carrier “Scoot”. Singapore Airlines plans to tackle the recent onslaught of Low Cost Carriers eating up its market pie with its new offering upto 40% cheaper fares than full service carriers. Scoot plans to begin operations in mid-2012 with 4 Boeing 777-200 purchased from parent Singapore Airlines for operating to various destinations in the booming markets of Australia and China, It aims to have about 50 pilots and 250 cabin crew by the end of next year all of whom will be hired from outside and plans to operate 14 aircraft by the middle of this decade. The airline will operate from Changi Airport’s terminal 2, offering…

Continue Reading »

Kingfisher’s air viability under question

As per Kingfisher’s annual report for the year ended March 31, 2011, the airline is in dire need of funds to keep going. Saddled  with huge debt and mounting losses, the airline has been finding it tough to raise money in the current market conditions. The airline had planned to raise $250-$350 million through an issue of global depositary receipts in January 2011 but it turned out to be a non-starter. Even though Kingfisher cut its debt through a restructuring by issuing shares to 14 banks which as of today own 29 percent of Kingfisher and has obtained approval from its board for equity infusion, the shareholders are highly worried about the operational sustainability of the airline which has led to  its market value slumping to under…

Continue Reading »