Low-cost airlines may have an edge in a price-sensitive, regionally focused travel market

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Low-cost carriers are likely to have an advantage in a price-sensitive and regionally focused air travel market, analysts told CNBC. However, one observer cautioned that the benefit can only be enjoyed when demand recovers.

Shantanu Gangakhedkar of Frost & Sullivan said attractive prices have always been the "primary reason" for the success of low-cost carriers in Asia.

"More so than ever now, when individuals and companies alike are looking at cost-effective options, LCCs will of course have an upper hand," he said, adding that the competition between these carriers would be "fierce."domestic air routes are opening first,"LCCs have already started flying domestic routes and are even offering discounts and promotions to attract passengers and thus are expected to start moving into green much before most FSCs," he said.

Southeast Asia in particular, is in a "really difficult hibernation mode," he told CNBC via video call. "There is some activity happening, but it's very limited. It's certainly not the stuff that recoveries are built on." The problem is that the market has just collapsed and ... all the advantages they have in their model can't really be brought to bear anymore.

 

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