Growth Airline Economic Analysis

In the current economic environment, there is little growth even among growth airlines. However, those airlines still have different costs and other characteristics than traditional network carriers. In this report, we cover the following topics:

A) Domestic unit cost comparisons for value (low cost) versus network carriers. The two groups are compared in terms of average CASM (and RASM), and these same comparisons are provided for the individual carriers within each group. Also, value and network carrier cost trends are shown over time, providing insight on the question – are network carriers reducing their cost gap with value carriers, or is the gap widening?

B) Cost comparisons for similar aircraft operated by different carriers, including stage-length adjustments.

C) A closer look at fuel costs and potential impacts on airline profitability: Latest developments in system-wide and spot prices for fuel, including competitive airline cost comparisons based on equal fuel cost assumptions.

D) Discussion of cost differences between the smaller and larger narrowbodies operated by selected value carriers.

E) A ranking of regional aircraft in terms of unit cost.

F) Strategic outlook: A brief look at changes in industry capacity to help answer the question – where is the growth?

Growth Airline Economic Analysis