We have been tracking the Long Haul LCC roller coaster. As we predicted in February of this year the market for Long Haul LCC would heat up in 2007. Seems like we might have even underestimated the scale.
If we look at the premier LCCs in the world today we can easily say that the top players include:
Ryanair, Gol, Air Asia, Air Berlin, Virgin Blue and Jetstar. (I am not counting hybrids like US Airways or Airtran who don’t quite count at the moment). Each of these players have taken a slightly different path to Long Haul LCC.
Ryanair will take advantage of the Semi-Open Skies between EU and US next year. Gol bought Varig, Air Asia has the Air Asia X JV with a certain Brit, Virgin Blue plumped down some of its cash for 777s to fly across the Pacific. Jetstar is a surrogate for QF and a replacement for Australian Airlines. Finally Air Berlin jumped into the fray with its purchase of LTU and the recent order this week for 25 787s.
The stage is now set for a explosive growth in long haul LCC. With so much capacity in the Europe-Asia markets, Transpac looking up and even the stodgy old Transatlantic market picking up - the opportunities for significant traffic number growth is looking quite good.
Now of course where will these people end up and is there enough capacity to entertain them once they get there? We shall see
Cheers
Timothy
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