Low cost carriers - or are they ?

One market sector within air transport has fared better in the last 12 months than any other - the low cost carrier .

But are those who announce their low cost credentials genuinely offering such a product? That basic 'get you a seat from a to b' product where anything on top attracts a charge . Analysis identifies that relatively few 'low cost carriers' now pass the test- few are now exhibiting the basic service that defines the true low cost model.

Want a ramp agent to place your bag in the hold - you pay for it ! Want a beer on board,want to pay for your ticket by credit card? - you pay for it ! Want a widow seat? - well that depends how fast you can run to the aircraft steps! Paying for each additional product facet has become the norm for 10s of millions of passengers worldwide. Those who will turn on the Ipod and listen to or watch their choice of entertainment and fore go the onboard in flight entertainment selected by someone else, bring their own drink on board and cram a weeks worth of clothes into the sports bag that with effort just passes the cabin bag size check at the gate.


Some who originally planned their business model with low cost foundations are adopting certain additional product features whilst the legacy carriers adjust their back end products taking them in the reverse direction to reduce costs. In times of difficulty there is the temptation to deviate from the known comfortable business model .

Enter the Hybrid carrier. Product creep towards the full service carrier whilst the legacy carriers creep backwards in terms of product in order to reduce cost has created this mongrel.

So does pre-boarding seat selection qualify under the low cost business model ? How about a hold baggage allowance? Free drink on board? Queuing for the traditional airport check in ?

Well many of the self stated 'low cost' carriers are exhibiting product creep by offering some of these additions in order to become attractive to the wider audience. In doing so they must now classify themselves as hybrid - parked between the genuine low cost business model and the traditional full service legacy model.

And with this comes additional cost - does the provision of these new products facets to attract the new 'need to have ' market set against offering them for the already converted and thus 'nice to have' market result in a net revenue improvement ?

So who is left on the loco ramp - by definition maybe 1 in Europe and 5 globally.

Of course the measure of success is the ability to take a product and deliver a return on investment when the market tours sour . This industry is good at re-inventing itself.

Who have been true to their no frills roots? Does it even matter that many of the low cost carriers are becoming Hybrid? Or is it something only marketing academics ponder over ?

What do you think ?