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The effects of low cost carrier entry in the Turkish Airline industry

Author

Listed:
  • Resul Aydemir

    (Istanbul Technical University)

  • Cihad Haytural

    (Turkish Airlines)

Abstract

The paper examines the impact of low-cost carrier Pegasus Airlines’ entry on Turkish Airlines’ yields in domestic and international routes. We find that Turkish Airlines’ yields are lower in both types of routes in response to entry. Moreover, the LCC entry affects domestic routes substantially more than international routes. Due to lower fares and heightened competition, the number of passengers has more than quadrupled in the last decade. Hence, we argue that Pegasus entry has been instrumental in transforming the Turkish Airline industry, which has become more dynamically competitive recently.

Suggested Citation

  • Resul Aydemir & Cihad Haytural, 2016. "The effects of low cost carrier entry in the Turkish Airline industry," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 6(1), pages 111-124, April.
    • Handle: RePEc:spr:eurase:v:6:y:2016:i:1:d:10.1007_s40822-015-0039-0
    DOI: 10.1007/s40822-015-0039-0
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    References listed on IDEAS

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    Cited by:

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    2. Massoud Moslehpour & Wing-Keung Wong & Yi Hsin Lin & Thi Huyen Nguyen, 2018. "Top purchase intention priorities of Vietnamese low cost carrier passengers: expectations and satisfaction," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 8(4), pages 371-389, December.
    3. Zuidberg, Joost, 2019. "Network geographies and financial performances in low-cost carrier versus network carrier competition: The case of Norwegian versus SAS," Journal of Transport Geography, Elsevier, vol. 79(C), pages 1-1.

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    More about this item

    Keywords

    Low-cost carriers; Market entry; Turkish Airline industry; Pricing strategies;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
    • R49 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Other

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