The past decade and change has seen a remarkable phenomenon in the air-travel market: airline revenue and profits soared, but international flights became cheaper than ever.But in recent years, inexpensive flights have become the norm. Even before the rollout of basic economy class, flights from the US to Europe and South America and Asia could routinely be found in the low hundreds of dollars. And passengers could book flights to Asia, the Middle East, and Africa for just a little more.
But as the pandemic has decimated airline route networks, brought travel demand to a virtual standstill, and led airlines to cut capacity, it's easy to wonder whether the flight market will be recognizable once travel comes back in full force. Travel demand has already begun to recover, albeit slowly and far below levels that airlines need in order to stop burning cash. However, Keyes noted that with people still anxious about travel, airlines can use a combination of cheap fares with messaging about steps they're taking to help prevent transmission of the coronavirus.
The cheapest fares in the world won't be enough to bring back demand, Keyes said, unless there's actually something to do at the destination. Throughout and after the airlines' return to normal, those cheapest fares should continue to be available, he believes, partly thanks to new revenue models. In order to generate revenue, those frequent-flyer programs need members to be engaged, and loyal enough to the airline brand to spend on a cobranded rewards credit card. Making the cheapest seats on the plane accessible to a wider number of people with low fares is one of the many ways an airline can do this, Keyes said. That makes the lower margins airlines earn on those cheap tickets more worthwhile.
rohanbhaumik
After the pandemic? What evidence makes you think there is an end?
Sverige Senaste nytt, Sverige Rubriker
Similar News:Du kan också läsa nyheter som liknar den här som vi har samlat in från andra nyhetskällor.
Källa: BusinessInsider - 🏆 729. / 51 Läs mer »