Air travel remains the as the number one link to exotic recreational places. Thus it prompts holiday makers choose this mode of transport as their link for worldwide tourism. This activity among business travel makes air industry among the fastest growing industry in the world. International trade, inter global investment, and economic growth enable the industry surge into higher ground as this activities are associated with international travel. International trade has also opened up places in South America, Asia and Africa that holiday makers would never have recognized before. Notably, these are the same areas that have been noted to have a surge in the growth of small airlines and low cost carriers to satisfy this market (Mouawad 2012).
Low cost airlines remained absent not until the 21st that their market become recognized and started growing (Casey 2010). The reason behind this is because low cost airlines were doomed as a failing market. Airlines that dad been established in the beginning of this industry enjoyed dominance in the market share because of the following reasons. Low cost airlines had incidents of terrorism thus passengers preferred the latter. Also, low cost airlines had a reputation of bad service and hospitality. Also, pilots of low cost airlines were rumored to endanger the lives of passengers due to carelessness and incompetence. However, this has not been an issue in this decade. Low cost airlines have undergone reforms and their services, manpower and professionalism is up to par with the larger established airlines.
Since the establishment of small airline being as reliable as big ones are, the big airline industry has faced numerous problems. The small airlines have raised the competitive bar on the airline industry that the old competitors are struggling to meet. The small airline industry has made the prices intensely competitive forcing bigger airlines to make budget cuts in order to meet these needs. Smaller airlines have improved customer service and this has made any big airlines to go under in their struggle to remain relevant in the market (Dunn 2010). The small airlines also offer direct routes for holiday makers who also prefer to travel in the more affordable price range. This has made the small airline industry like AirTran and JetBlue become more popular and many of them projecting profits in their fiscal year ( 2012). As a result, big airlines like Alaska Airlines are not performing so well. The rigid competition has had its toll in these traditional airlines that had not foreseen or prepared for times like this. Delta Air Lines remains among the few who continue to perform well in this aggressive industry.
The low cost airlines have had a huge economic benefit to the shareholders involved. The first of the parties to benefit are the airlines themselves. Their resilience to open up in areas that were in the past not as popular has paid off since holiday makers have responded positively to the new exotic travelling destinations. Some of these areas are include Asia and Africa. Also, shareholders in tourism industry have benefited immensely since the profit margins have increased and as a result, economies have grown. Dubai and South Africa have had booming economies since they share holders realized of the trade early enough and made inviting investments.
In conclusion, low cost airlines have opened up markets that were dormant in the recent past. For the risk they took, most have reaped amazing benefits. Holiday makers have also benefited from this venture since they have more and better yet more inviting destinations to travel. The low cost airlines have also created a job market for many who would have wrangled up in poor paying jobs especially in this economy. Consequently, low cost airlines have made the world a happier place for almost everyone and the economy.
Casey, Mark. Low Cost Air Travel: Welcome Aboard? Tourist Studies 10. 2 (2010) 175- 191.
Dunn, Graham. Special Report: Low Cost Carriers – Coming of Age, 2010.
, Kenneth. Fliers Like Alaska and JetBlue: Big Airlines Not So Much, 2012. Web.
Mouawad, Jad.For United, Big Problemsat Biggest Airline 2012. New York Times.