THE EVOLUTION OF THE LOW-COST AIRLINES IN US. THE CASE STUDY ON SOUTHWEST AND JETBLUE AIRLINES

Laura DIACONU (maxim) () and Cristian Popescu ()
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Laura DIACONU (maxim): Faculty of Economics and Business Administration, Al. I. Cuza University of Iasi, Romania

The Annals of the "Stefan cel Mare" University of Suceava. Fascicle of The Faculty of Economics and Public Administration, 2011, vol. 11, issue 1(13), 92-97

Abstract: The low-cost companies emerged for the first time in the USA airlines’ industry, their model being subsequently taken by the world-wide operators. The purpose of the present paper is to analyze the development stages of the USA low-cost operators’ market, identifying the determinants of the evolution of two major airlines: Southwest and JetBlue, through an empirical study conducted on these two companies in the end of the year 2009. Therefore, the information was collected both from secondary and primary sources, fact that allowed not only a descriptive approach of the low-cost airlines, but also an empirical research based on a questionnaire delivered by email to the two US operators. The information received was analyzed, tabulated and interpreted for each operator. The conclusions of this study suggest the fact that the market of the low-cost airlines from USA is in a stage much more advanced than those from other regions, being nowadays in the maturity phase. Regarding Southwest and JetBlue, we do notice the fact that the methods used by them in lowering the tariffs are based not only on the cost reduction, as it is the case of other low-cost operators, but also on maintaining a good ratio between their price and the quality of the services offered. The results presented in the end of the paper made the object of a larger case study.

Keywords: low-cost airlines; cutting costs strategy; competition; traditional operators; development stage (search for similar items in EconPapers)
Date: 2011
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