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Low-cost airline

The goal and objectives

My aim is to make a flyting company that can compete with the leaders of this sector. This company will give the same comfort and service at the cheaper cost. And also it will include some lines between cities, which are not commonly used by the biggest companies in airlines sector. Main tool of my project is an efficiency using of minimum number of planes.

What it means low-cost airline?


A low-cost carrier or lowcost airline is an airline that generally has lower fares and fewer comforts. To make up for revenue lost in decreased ticket prices, boarding, seat allocating, and baggage etc.

Type of aircrafts
Commonly most low-cost airlines operate aircraft with a single passenger class, and the most operate just a single type of aircraft. Mostly they use the Airbus A320 or Boing 737 families, which are more efficient aircrafts that help to reduce training and servicing cost.

Boing 737
Airbus A320

Extra equipment

Minimum set of extra equipment, further reducing costs of acquisition and maintenance, as well as keeping the weight of the aircraft lower and thus saving fuel. Pilot conveniences may be excluded such ACARS and auto throttle.

For Example

The first airline company with low-cost model is Southwest Airlines Co. This company started working in 1967 and it is the largest airline in US, based upon domestic passengers carried. This fact shows that low-cost airline is a beneficial project.

From 2001 to 2003, when industry of air carrying was damaged from terrorism, wars and SARS (severe acute respiratory syndrome), most of full-cost airline made a losses, while many low-cost air companies declared a profit.

Research Strategy

As a research strategy I used descriptive and explanatory study, because I collect the information about the companies that were before my project and used that information to construct my own idea. I used an experience of another companies in this sector. Also I need an statistical data about the number of travelers to different destinations.

Methodology

Our project should be rentable if the minimum percentage of passenger in one flight will 90% according to the whole number of seats in aircraft. While in another airlines it needs only 70% of passengers, another 30% of passengers gives only profit. We can get profit form only 10% of passengers because our project has a low-cost idea and it firstly social oriented project.

The ways of making low-cost airlines

Strategic comparison between Regular and Low-Cost Carriers


National carriers Business model Network Fleet Product Sales policy Global Strategy & High cost Hub & spokes Global alliance Different types of planes Full service Sales departments Distribution by GDS Low-cost carriers Niche strategy& low cost Point to point between secondary airports Standardization Self service Direct sales Call centers / internet

Data collection
I used secondary and tertiary data. Everything I took from internet.

Expected results

The main goal for the first years is to make company rentable. The purpose is to increase the number of passengers by withdrawing them competing companies. We can think about profit only after 2-3 years, when the amount of regular passengers will be large and our company will earn some positive reputation.

Information to stakeholders

This project dont need too much money, we need just a standardized aircrafts ( ex: Airbus A320) to start the project, after 2-3 years of maximum efficiency using these two airplanes, the project should cover the costs of them. And only from that point company should think about increasing park of planes.

Thank you

The main idea is to give people a cheap alternative in traveling by airplanes.