IDEAS home Printed from https://ideas.repec.org/a/eee/jaitra/v55y2016icp234-244.html
   My bibliography  Save this article

Base abandonments by low-cost carriers

Author

Listed:
  • Malighetti, Paolo
  • Paleari, Stefano
  • Redondi, Renato

Abstract

This paper is the first attempt to systematically investigate the phenomenon of base abandonments by low-cost carriers (LCCs) in the world, from 1997 to 2014. Our results identify 109 cases where the LCCs decreased their presence in airports by at least 50 per cent in terms of offered seats. In 28 cases, the LCCs completely abandoned the airports. The incidence of downsizing is significantly reduced for important base airports. The abandonment by LCCs can be reversed, even though this is not very likely; in only 7.3 per cent of cases the same LCCs recovered full capacity. The impact on airports of LCC abandonments depends on the carrier level of dominance. The presence of middle size alternative airports increases the likelihood of downsizings.

Suggested Citation

  • Malighetti, Paolo & Paleari, Stefano & Redondi, Renato, 2016. "Base abandonments by low-cost carriers," Journal of Air Transport Management, Elsevier, vol. 55(C), pages 234-244.
    • Handle: RePEc:eee:jaitra:v:55:y:2016:i:c:p:234-244
    DOI: 10.1016/j.jairtraman.2016.06.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969699716300473
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jairtraman.2016.06.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Starkie, David, 2012. "European airports and airlines: Evolving relationships and the regulatory implications," Journal of Air Transport Management, Elsevier, vol. 21(C), pages 40-49.
    2. Anna Bottasso & Maurizio Conti & Claudio Piga, 2013. "Low-cost carriers and airports' performance: empirical evidence from a panel of UK airports," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(3), pages 745-769, June.
    3. Frédéric Dobruszkes, 2013. "The geography of European low-cost airline networks: A contemporary analysis," ULB Institutional Repository 2013/135954, ULB -- Universite Libre de Bruxelles.
    4. Gillen, David & Lall, Ashish, 2004. "Competitive advantage of low-cost carriers: some implications for airports," Journal of Air Transport Management, Elsevier, vol. 10(1), pages 41-50.
    5. Morandi, Valentina & Malighetti, Paolo & Paleari, Stefano & Redondi, Renato, 2015. "Codesharing agreements by low-cost carriers: An explorative analysis," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 184-191.
    6. Brueckner, Jan K & Spiller, Pablo T, 1994. "Economies of Traffic Density in the Deregulated Airline Industry," Journal of Law and Economics, University of Chicago Press, vol. 37(2), pages 379-415, October.
    7. de Wit, Jaap G. & Zuidberg, Joost, 2012. "The growth limits of the low cost carrier model," Journal of Air Transport Management, Elsevier, vol. 21(C), pages 17-23.
    8. Forsyth, Peter, 2003. "Low-cost carriers in Australia: experiences and impacts," Journal of Air Transport Management, Elsevier, vol. 9(5), pages 277-284.
    9. Warnock-Smith, David & Potter, Andrew, 2005. "An exploratory study into airport choice factors for European low-cost airlines," Journal of Air Transport Management, Elsevier, vol. 11(6), pages 388-392.
    10. Barrett, Sean D., 2004. "How do the demands for airport services differ between full-service carriers and low-cost carriers?," Journal of Air Transport Management, Elsevier, vol. 10(1), pages 33-39.
    11. Maria José Gil-Moltó & Claudio A. Piga, 2008. "Entry and Exit by European Low-Cost and Traditional Carriers," Tourism Economics, , vol. 14(3), pages 577-598, September.
    12. Steven A. Morrison, 2001. "Actual, Adjacent, and Potential Competition Estimating the Full Effect of Southwest Airlines," Journal of Transport Economics and Policy, University of Bath, vol. 35(2), pages 239-256, May.
    13. Dobruszkes, Frédéric, 2013. "The geography of European low-cost airline networks: a contemporary analysis," Journal of Transport Geography, Elsevier, vol. 28(C), pages 75-88.
    14. Graham, Anne, 2013. "Understanding the low cost carrier and airport relationship: A critical analysis of the salient issues," Tourism Management, Elsevier, vol. 36(C), pages 66-76.
    15. Bilotkach, Volodymyr & Mueller, Juergen & Németh, Adél, 2014. "Estimating the consumer welfare effects of de-hubbing: The case of Malév Hungarian Airlines," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 66(C), pages 51-65.
    16. Francis, Graham & Fidato, Alessandro & Humphreys, Ian, 2003. "Airport–airline interaction: the impact of low-cost carriers on two European airports," Journal of Air Transport Management, Elsevier, vol. 9(4), pages 267-273.
    17. Redondi, Renato & Malighetti, Paolo & Paleari, Stefano, 2012. "De-hubbing of airports and their recovery patterns," Journal of Air Transport Management, Elsevier, vol. 18(1), pages 1-4.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Keeling, David J., 2020. "Restructuring Argentina's airline networks: Successes and challenges," Journal of Transport Geography, Elsevier, vol. 86(C).
    2. Dobruszkes, Frédéric & Givoni, Moshe & Vowles, Timothy, 2017. "Hello major airports, goodbye regional airports? Recent changes in European and US low-cost airline airport choice," Journal of Air Transport Management, Elsevier, vol. 59(C), pages 50-62.
    3. William O’Brochta, 2017. "International tourism’s impact on regional autonomy," Tourism Economics, , vol. 23(8), pages 1632-1661, December.
    4. Nicolò Avogadro & Sebastian Birolini & Mattia Cattaneo & Paolo Malighetti & Chiara Morlotti & Renato Redondi, 2020. "Yardstick Regulation in a Competitive Context? The Case of the Italian Airports," Competition and Regulation in Network Industries, , vol. 21(3), pages 244-274, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Loh, Hui Shan & Yuen, Kum Fai & Wang, Xueqin & Surucu-Balci, Ebru & Balci, Gökcay & Zhou, Qingji, 2020. "Airport selection criteria of low-cost carriers: A fuzzy analytical hierarchy process," Journal of Air Transport Management, Elsevier, vol. 83(C).
    2. Choo, Yap Yin & Oum, Tae Hoon, 2013. "Impacts of low cost carrier services on efficiency of the major U.S. airports," Journal of Air Transport Management, Elsevier, vol. 33(C), pages 60-67.
    3. Dobruszkes, Frédéric & Givoni, Moshe & Vowles, Timothy, 2017. "Hello major airports, goodbye regional airports? Recent changes in European and US low-cost airline airport choice," Journal of Air Transport Management, Elsevier, vol. 59(C), pages 50-62.
    4. Dziedzic, Marcin & Njoya, Eric T. & Warnock-Smith, David & Hubbard, Nick, 2020. "Determinants of air traffic volumes and structure at small European airports," Research in Transportation Economics, Elsevier, vol. 79(C).
    5. Lu, Hua-An & Mao, Yun-Ru, 2015. "Evaluation of airport conditions to attract foreign low cost carriers: A case study of Taiwan," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 297-305.
    6. Wong, Wai-Hung & Zhang, Anming & Cheung, Tommy King-Yin & Chu, Jeremy, 2019. "Examination of low-cost carriers' development at secondary airports using a comprehensive world airport classification," Journal of Air Transport Management, Elsevier, vol. 78(C), pages 96-105.
    7. Jimenez, Edgar & Claro, João & Pinho de Sousa, Jorge & de Neufville, Richard, 2017. "Dynamic evolution of European airport systems in the context of Low-Cost Carriers growth," Journal of Air Transport Management, Elsevier, vol. 64(PA), pages 68-76.
    8. Budd, Lucy & Francis, Graham & Humphreys, Ian & Ison, Stephen, 2014. "Grounded: Characterising the market exit of European low cost airlines," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 78-85.
    9. Dobruszkes, Frédéric & Mondou, Véronique & Ghedira, Aymen, 2016. "Assessing the impacts of aviation liberalisation on tourism: Some methodological considerations derived from the Moroccan and Tunisian cases," Journal of Transport Geography, Elsevier, vol. 50(C), pages 115-127.
    10. Jimenez, Edgar & Suau-Sanchez, Pere, 2020. "Reinterpreting the role of primary and secondary airports in low-cost carrier expansion in Europe," Journal of Transport Geography, Elsevier, vol. 88(C).
    11. Stephen Pratt & Markus Schuckert, 2019. "Economic impact of low-cost carrier in a saturated transport market: Net benefits or zero-sum game?," Tourism Economics, , vol. 25(2), pages 149-170, March.
    12. Pandey, Mukesh Mohan, 2020. "Evaluating the strategic design parameters of airports in Thailand to meet service expectations of Low-Cost Airlines using the Fuzzy-based QFD method," Journal of Air Transport Management, Elsevier, vol. 82(C).
    13. de Wit, Jaap G. & Zuidberg, Joost, 2016. "Route churn: an analysis of low-cost carrier route continuity in Europe," Journal of Transport Geography, Elsevier, vol. 50(C), pages 57-67.
    14. Button, Kenneth & Kramberger, Tomaž & Grobin, Klemen & Rosi, Bojan, 2018. "A note on the effects of the number of low-cost airlines on small tourist airports' efficiencies," Journal of Air Transport Management, Elsevier, vol. 72(C), pages 92-97.
    15. Lohmann, Gui & Vianna, Camila, 2016. "Air route suspension: The role of stakeholder engagement and aviation and non-aviation factors," Journal of Air Transport Management, Elsevier, vol. 53(C), pages 199-210.
    16. Fageda, Xavier & Suau-Sanchez, Pere & Mason, Keith J., 2015. "The evolving low-cost business model: Network implications of fare bundling and connecting flights in Europe," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 289-296.
    17. Zuidberg, Joost, 2017. "Exploring the determinants for airport profitability: Traffic characteristics, low-cost carriers, seasonality and cost efficiency," Transportation Research Part A: Policy and Practice, Elsevier, vol. 101(C), pages 61-72.
    18. Lin, Eliver & Mak, Barry & Wong, Kevin, 2013. "The business relationships between LCCs and airports in Southeast Asia: Influences of power imbalance and mutual dependence," Transportation Research Part A: Policy and Practice, Elsevier, vol. 50(C), pages 33-46.
    19. Burghouwt, Guillaume & de Wit, Jaap G., 2015. "In the wake of liberalisation: long-term developments in the EU air transport market," Transport Policy, Elsevier, vol. 43(C), pages 104-113.
    20. B. F. Oliveira & A. V. M Oliveira, 2023. "An empirical analysis of the determinants of network construction for Azul Airlines," Papers 2312.05630, arXiv.org.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jaitra:v:55:y:2016:i:c:p:234-244. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/journal-of-air-transport-management/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.