The airline cost equation: strategies for competing with LCCs

In spite of all the talk of business model convergence, there are still meaningful unit cost differences between low cost airlines and full service/legacy airlines. Anyone can unbundle and offer seat-only low fares, but this is not the same as having the low costs necessary to be profitable with such fares. Business model choice has implications for cost structure as well as for revenues.

Legacy airline responses to competition from low cost airlines have included cutting costs, adopting low cost features, setting up or buying a low cost subsidiary, and forging partnerships with LCCs. However, LCC market share continues to increase.

A panel discussion at the CAPA Airline Leader Summit on 17 & 18-May-2018 will discuss the theme 'The Cost Equation: cutting costs and strategies for competing with low cost carriers'. The panel will include IAG CEO Willie Walsh, Kenya Airways CEO Sebastian Mikosz, Amedeo CEO Mark Lapidus, AACO Secretary General Abdul Wahab Teffaha and AAPA Director General Andrew Herdman.