Time to ditich the ‘Loco’ label?Back to Forum
Anonymous31 Aug 2013
When the likes of Ryanair, easyJet, Debonair, Buzz, Air Berlin et al started to make an impact, they were generically known as ‘low cost airlines.’
This was not a reference to their pricing, but to their strategy of focusing on achieving the lowest costs in the industry and this became synonymous with ‘low service’, in the form of unallocated seating, paid for F&B etc.
I no longer see such a clear division, since the boundaries are becoming blurred, e.g. Flybe is known as a ‘loco’ and yet has high operating costs, as does Norwegian, another ‘loco’; the latter, however, seems to be growing successfully.
Equally, Ryanair has maintained a very low cost focus and so has Wizz Air, which I believe has slight lower cost per ASK (available service kilometre), obviously not on the same scale.
At the same time, we see KLM starting to charge for bags and BA offering bagless fares, whilst the Lufthansa Group integrates Germanwings into it’s network as the non-hub carrier.
So is there any merit in describing airlines as ‘low cost’ in the context of offering reduced services?
I think not, but others may disagree.31 Aug 2013
Although you are totally correct FDOS, imo Joe Public will primarily associate the “Low Cost” as being low cost to them ie Low Priced. If Low Priced then Low Service/Better Value.
Imo although inappropriate, Loco as a nomenclature will stick as a differentiator from Legacy/National, though the definition is certainly increasingly blurred.
I can’t recall the classification of Sir Freddie’s Skytrain. It certain was not Loco.31 Aug 2013
From a marketing point of view, terming anything to do with aviation as “low cost” creates an impression of cheap and nasty as well as creating perceptions of poor safety.
it gives the airports the excuse to create second rate terminals and in some cases the “legal” ability to geographically associate some villages with cities, which take longer to get to than the flight itself!!
IMHO, “loco” is a terrible term, what would be more useful is a clearer policy by each airlines, exactly which market they in, in terms of passenger benefits….31 Aug 2013
I saw Ryanair recently describe themselves as an ‘ultra low cost carrier’….
I’ve always considered Flybe as a legacy carrier – they were full service in the Jersey European days and I suppose they are having the same challenges as other legacy operators in getting costs down.
You are right though, the boundary is a bit blurred, operators like Easyjet have done a decent job sinking their teeth into the business market whilst keeping costs down.31 Aug 2013
so within the same discussion why should the old style airlines be termed as legacy when quite clearly, some are offering new style “loco” service too ??..
Perhaps an Airline is just an airline and recognition (or service indicator) would be better by a universally accepted “recognition indicator” – whether gold stars, diamonds or even emeralds!!!31 Aug 2013
I do believe that the advent of ‘ancillary fees’ has blurred the distinction between the two airline types.
LX has brought in checked baggage fees (limited so far on routes to/from GVA) and one could argue that LH has too, given that all of its non-hub (yet still important) routes have been or will be hived off to German Wings.
The main difference is that conventional airlines will interline (unless holding separate tickets but even then some carriers will still through-check you) whereas low-cost carriers will not.1 Sep 2013
That’s interesting, but I even see some anomalies in interlining
e.g. Air Berlin and JetBlue, codesharing with Etihad (and Oneworld) and Aer Lingus codesharing with the latter.1 Sep 2013
The loco model is predominantly underpinned by an outsourced and transient workforce.
Ryanair is not the only carrier to have a substantial zero hour/contract flight/cabin crew plus a raft of outsourced ground services.
Their ability to rapidly flex supply to demand without maintaining a high level of over capacity means they have a far better asset utilization and cost ratios than the legacy carriers. It also means that relatively few of the people in their uniform are their employees.
Legacy to Commodity
Full Service to Pay as You Go Ancillary
… increasingly blurred as even individual airlines have a variety of offerings along each continuum, however the trend is toward commoditisation.1 Sep 2013
As Simon says, Easyjet have done a decent job sinking their teeth into the business market, and I cannot help but feel they are becoming more and more like BA, even beating BA in their European ops, but without the baggage BA carries from the past.
Is BA Europe really a full service airline anymore? A legacy carrier for sure, but full service I’m not so convinced, in the same way I’m not quite convinced EasyJet Is “Loco/LCC” anymore.1 Sep 2013
“Is BA Europe really a full service airline anymore? A legacy carrier for sure, but full service I’m not so convinced, in the same way I’m not quite convinced EasyJet Is “Loco/LCC” anymore.”
A very good point and I tend to agree with LP.1 Sep 2013
Are there any airlines that can truly say they are 100% full service ?
Are there any airlines that can truly say they are 100% loco ?
As FDoS has constantly stated, despite most of us avoiding FR, they are probably the only airline that actually performs as described…1 Sep 2013
This article appeared in the Daily Mail yesterday, headed:
“Is this the end of the ‘no-frills’ airline? EasyJet to sell tickets that include all the extras (but yes, there is an extra charge for that)”.
This is specifically aimed at business passengers, simplyflying the reservation process. However, this something that VUELING has been doing for some years with its “Basic, Optimum and Excellence fares”.
It seems to be another indication that the “low-cost”carriers are becoming more and more like the so called “legacy” carriers. The whole business is going full circle.
Norwegian´s new long-haul flights to Nortgh America should give a glimpse of the future.7 Sep 2013