Here’s how fast budget carriers are growing

If you feel like you’ve seen a constant drumbeat of announcements of new routes by the discount carriers, it’s no illusion. The likes of Norwegian, WOW and a few others are growing fast, and it’s changing the trans-Atlantic picture.

Even though the big legacy carriers such as British Air, American, Delta, KLM/Air France and Lufthansa continue to grow, it’s slow. And the low-cost competitors are increasing market share every year.

Just for a sample: last year, Norwegian’s trans-Atlantic capacity grew 111%, while British Air grew capacity by 1.1%. Measured by another important scale, load factor, industry figures indicate BA flies the Atlantic about 82.5% full, while Norwegian reported 94%. Norwegian is approaching half of BA’s capacity as it expands, although it’s still only 7th in the market.

WOW Air, whose trans-Atlantic flights all involve a stop in Iceland, had 31% growth in the same period, second only to Norwegian. The only big legacy carrier to break into double digits was Iberia.

The growth has created changes for the ‘giants’ of the market. American has been ditching first-class to make room for more lower-cost seats, and has added ‘basic economy’ to the mix, as have several others. BA’s parent has created Level, its own low-cost carrier. Others have cut ‘frills’ or charged for them; it’s far from clear yet whether this will help hold market share.

Ironically, it’s not that long ago that Delta and other major carriers were thinking that the Gulf airlines were the biggest threat to their business; it’s not so long ago that many of them were sure there was no room in trans-Atlantic for true low-cost carriers.

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