Low cost carriers are an inevitable part of the airline industry that needs to be taken seriously by the full service carriers, says Tiger Group CEO Tony Davis.
"The reality is that customers want low fares," says Davis, who was speaking at the Association of Asia Pacific Airlines assembly of presidents in Singapore. "Everyone has to realise that this is the reality. Once they fly with us, they try us, they see how reasonable and efficient we are, especially on the short haul sectors, they continue to use us."
He reiterates that it is a mistake to dismiss low-cost carriers. Looking back to the start of his career at British Airways, he says that the UK carrier initially did not take upstarts like Easyjet and Ryanair seriously. This was to its cost, as both carriers are now major challengers to almost all legacy airlines in Europe.
During the economic crisis, it has been the low cost carriers that have proved better able to cope with lower demand and grow, he adds.
"Low cost carriers can use these dips in the cycle to grow," he says. "Low cost carriers are still ordering aircraft and taking delivery of aircraft at a time when everyone else is not. We are still growing."
Source: Air Transport Intelligence news
