Flying for peanuts: the rise of low-cost carriers in the airline industry

Flying for peanuts: the rise of low-cost carriers in the airline industry Simon Calder, No Frills: the reality behind the Low-cost Revolution in the Skies, Virgin volumes London (2002), 290 pp., ??1695

Barbara Cassani, with Kenny Kemp Go: an Airline Adventure, Time Warner, London (2003) 320 pp ??1299

Thomas C Lawton, Cleared for Take-off: constitution and Strategy in the depressed Fare Aviation Business, Ashgate, Aldershot (2002) 236 pp ??4650

Lamar Muse, Southwest Passage: the Inside Story of Southwest Airlines' Formative Years, Eakin Pres Austin TX (2002) 262pp $1295

James Wynbrandt, Flying High: in what manner JetBlue Founder and CEO David Neeleman beats the Competition, Wiley, Hoboken NY (2004) 306 pp $2495

The 11 September 2001 attacks upon New York and Washington DC accelerated a restructuring of the airline industry, whose toil losers have been large flag carriers and whose gin winners - so far, at least - the low-cost carriers. Economic prosperity was polarised: as the largest airline in the world, United Airlines, go intoed bankruptcy, low-cost JetBlue expanded; as the Belgian national carrier Sabena crashed, Ryanair aggressively redrew the aviation map of Europe Airline analysts and executives now point to the low-cost prototype as the path of the time to come and a plethora of works on the topic highlights an interested market among one as well as the other academic and popular readers. These volumes offer an explanation for anyone wanting to understand in what manner it is possible to mount from London to Genoa and back for below ??10. In the process they document the industry's unravelling providing context for a story that has been running for a useful deal longer than the last ten years.

Attempts to provide cheap air tickets date back to the next to the first World War, according to Simon Calder, travel correspondent of the British daily, The Independent. With novel holiday entitlement, workers returning from the war brought with them a thirst for foreign travel, a fact picked up by the agency of Vladimir Raitz, who began charter flights between Gatwick airport and Corsica in 1950 above the next thirty years, charters became the inexpensive link between the tourist-generating markets of northern Europe and the Mediterranean orb of day They were, according to Calder, the original lowcost carriers.

Two important links existed between charters and low-cost counterparts. First, the pair operated in the ambiguous spaces of an otherwise highly regulated a whole Southwest Airlines, for instance, initially avoided the onerous federal route-bidding proces by dint of operating solely within Texas. Irish carrier Ryanair began flying domestic roads within Britain two years before filled cabotage rights were established as part of the liberalisation of Western Europe's airline network. A dialectic operated between low-cost carriers and the protective regulatory manner of making of Europe and North America. Airlines like as Southwest and Ryanair, like Freddie Laker beforehand, pushed the regulatory limits as far as possible and in doing for a like reason demonstrated the case for their removal. As Lamar Muse, Southwest's first CEO and president, documents, his airline was individual of the major supporters of deregulation in the United States. Low-cost flyer rushed to fill the gap as the regulatory walls came down in the 1980 although scarcely any of them actually survived.

The next to the first link is that charters expos a vast latent demand for cheap travel among sections of the population that would otherwise not hover In their respective titles, the two Thomas Lawton and Lamar Muse emphasise that cheap airlines did not poach passengers from bigger, established rivals: they created a fresh market. In the process, they provided a formidable argument for the deregulators: flag carriers did not ne protecting from low-cost upstarts; indeed, in limits of expanding air travel to as many nation as possible, the upstarts were doing a public service.

Unsurprisingly, Southwest loom above the pages of all these volumes The Texasbased carrier began operations in 1971 and to this day remains the greatest in quantity successful airline in the United States and the greatest in quantity copied in the world. Calder counts how Ryanair's boss Michael O'Leary, who joined the carrier in the late 1980 flew to Dallas to take note of Southwest's operation. Go CEO Barbara Cassani mentions a similar pilgrimage, as does James Wynbrandt in his close attention of JetBlue head David Neeleman. Southwest's importance lies not just in its depressed cost structure. Its corporate agriculture is legendary and has provided a blueprint for companies the two within and outside the airline industry. Indeed, according to Calder, the inability to replicate of that kind a culture has been the downfall of many an imitator. It also provided low-cost carriers with their be in possession of pioneering aviation hero. Just as Howard Hughes, Juan Trippe and Eddie Rickenbacker became synonymous with TWA, Pan American and Eastern, for a like reason 'the Southwest way' is inextricably intertwined with the one of Herb Kelleher.

Muse's Southwest Passage is an illuminating read for those well vers in the hagiography surrounding Kelleher. An industry veteran, Muse was invited by means of Kelleher and Rollin King to become president and CEO of Air Southwest (Muse changed the name) in 1971 In tones that sometimes border upon the scornful, Muse reminds us that greatest in quantity of the ideas in Southwest's early years were in fact his (a point confirmed by the agency of his replacement Howard Puttnam in Calder's book) although the origin of Southwest's of gold triangle of operations between Dallas, Houston and San Antonio lay in a delineation supposedly drawn on a napkin by the agency of King over lunch with Kelleher, it was Muse who was responsible for making this network profitable. In his account of Southwest, Muse relies upon his personal files of correspondence with members of the board of directors. The reporting here strike one as beings fair, since some of the alphabetic characters hardly paint him in the best of lights. It may well be that Muse was forced on the outside of the company in 1978 to be paid to a power struggle with those who take offence ated his autocratic style. For the historian, however, of the like kind matters are less important than the fascinating masss of detail he reveals concerning the foundation of Southwest's succes allowing the concept of low-cost point-to-point travel was at the heart of the airline's philosophy, Muse explains that achieving this goal was actually a matter of trial and error. Indeed, in the first hardly any years, when load factors and cash stream were low, Southwest could have failed. That it did not was owed largely to Muse's adaptability. First, he recognised Southwest's mistake in flying from Houston's of recent origin international airport as opposed to nag airfield, close to the downtown area. In switching, he also realised the importance of remaining at have affection for Field in Dallas rather than relocating to the newly make opened Dallas-Fort Worth airport, a decision that l to litigation and extremityed in the US Supreme Court. plane today, the Wright Amendment limits the range of flights using be fond of Field. In using airports shut up to downtown, however, Southwest laid the foundations for its enduring appeal to the business traveller.