Full-service carriers (FSCs) have long ruled the transAtlantic market, due to the absence of low fare competition, which has kept airfares high. However, renewed interest in lowcost, long-haul (LCLH) flights was prompted by efficient aircraft, low fuel prices, liberalization of air markets, and low-cost carriers' growth opportunities. Since 2013, multiple LCLH carriers have commenced transAtlantic operations, and their market share has grown to 8%. In response, FSCs are establishing their own LCLH subsidiaries and/or introducing basic economy airfares to more effectively compete in the transAtlantic market. The purpose of this dissertation was to further the understanding of LCLH and FSC passengers in the transAtlantic market by determining what demographics and airline service attributes affected their choice of carrier type, and also what impacted their willingness to switch carrier type and the amount they were willing to pay to do so. A total of 1,412 transAtlantic economy and premium economy passengers were surveyed at Los Angeles (LAX) and Seattle-Tacoma (SEA) Airports, which included those who had flown an LCLH (n = 787) or an FSC (n = 625). Exploratory and confirmatory factor analyses were performed to develop a factor structure for passenger travel experience attributes, which were identified as: Operations, Comfort, Onboarding, Service, and Flight Schedule, along with a variable, Airfare. v Binary logistic regression was used to determine the variables/factors that affected passenger choice of LCLH or FSC. Younger passengers preferred LCLH carriers, whereas older passengers preferred FSCs. Airfare was the most important predictor of choice of carrier type, followed by Comfort, Service, and Flight Schedule. Satisfaction with Airfare and Comfort were associated with choice of an LCLH carrier, whereas satisfaction with Service and Flight Schedule were associated with choice of an FSC. Willingness to switch from an LCLH to an FSC was evaluated, with 55% of respondents indicating they would remain loyal, and 45% of them being willing to switch to an FSC. Decision tree analyses were utilized to show the relationships between variables/factors that were relevant for passenger switching decisions. The variables/factors that affected an LCLH passenger's willingness to switch to an FSC were: Airfare, Income, Education, Age, Gender, Comfort, and Operations. Binary logistic regression was utilized to determine that Age, Education, and Cabin Class affected willingness to pay more to switch to an FSC. Willingness to switch from an FSC to an LCLH was evaluated, with 76% of respondents indicating they would remain loyal, and 24% being willing to switch to an LCLH carrier; with a decision tree showing that Gender, Service, Airfare, and Onboarding affected this decision. Binary logistic regression was utilized to determine that Airfare, Nonstop Flights, and Courtesy and Responsiveness affected willingness to pay less to switch to an LCLH carrier. This research has demonstrated that often overlooked aspects of air travel,...
There has been a resurgence of interest in low-cost long-haul (LCLH) operations as airlines seek new growth opportunities. However, researchers have yet to evaluate and compare the relative efficiency of LCLH carriers in this competitive business environment. The purpose of this paper was to determine the relative efficiency of LCLH carriers in the Trans-Atlantic and Asia-Pacific markets. Data Envelopment Analysis (DEA) models were developed to compare the efficiency of five low-cost carriers: AirAsia X, Cebu Pacific, Norwegian Air, WestJet, current LCLH carriers, and JetBlue, a prospective LCLH carrier. The key findings from this DEA were that AirAsia X, Norwegian Air, and JetBlue were relatively efficient for all four quarters, whereas, Cebu Pacific was relatively efficient for three out of four quarters, while WestJet was relatively inefficient. Recommendations include suggestions for WestJet to lower its cost structure, and increase load factor, revenue passenger miles, and total revenue to achieve success with LCLH operations.
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