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Title:

Competition through Service: Impact of Investing in In-Flight Services on Airlines’ Financial Gain

Accession Number:

01658034

Record Type:

Component

Abstract:

After US airline deregulation in 1978, a new era of competition among legacy airline and low-cost carriers has been observed. The no-frill business model seemed to attract a notable share of the market. However, adoption of this approach by legacy airlines often failed to achieve the same results. In this study, the authors are interested in researching the competitiveness of an airline from the perspective of its success is increasing customers’ willingness to pay. They particularly study the factors related to the quality of service. They use econometrics models to study the domestic US market from 1990 to 2017. The authors' results show that investing in flight attendance and to a higher degree in food and on-board services positively affect airlines’ yield while revenue from baggage fees has a negative impact on airlines’ yield.

Supplemental Notes:

This paper was sponsored by TRB committee AV040 Standing Committee on Aviation Economics and Forecasting.

Report/Paper Numbers:

18-00265

Language:

English

Authors:

Azadian, Farshid
Vasigh, Bijan

Pagination:

14p

Publication Date:

2018

Conference:

Transportation Research Board 97th Annual Meeting

Location: Washington DC, United States
Date: 2018-1-7 to 2018-1-11
Sponsors: Transportation Research Board

Media Type:

Digital/other

Features:

References; Tables

Uncontrolled Terms:

Willingness to pay

Geographic Terms:

United States

Subject Areas:

Aviation; Economics; Finance; Planning and Forecasting

Source Data:

Transportation Research Board Annual Meeting 2018 Paper #18-00265

Files:

TRIS, TRB, ATRI

Created Date:

Jan 8 2018 10:05AM