Author(s): Kuhn, Mattheus Mascarenhas
Date: 2017
Persistent ID: http://hdl.handle.net/10362/27906
Origin: Repositório Institucional da UNL
Subject(s): Airline within airline; Business model; Low-cost carrier; Strategy; Domínio/Área Científica::Ciências Sociais::Economia e Gestão
n light of the low-cost carrier phenomenon started by Southwest in the 1970’s, flagship airlines have taken many measures to fight the budget competition. On the one hand, this paper explains the success of budget airlines in detail, while giving insight into the new trend of adopting hybrid models in the low-cost market. On the other hand, it compares incumbent airlines’ strategies against the true low-cost model and elaborates that carriers within carriers fail because of insufficient implementation of low-cost structures, high cannibalization effects and low levels of autonomy that are required to build a successful subsidiary.
