Originally Posted by
rickair7777
They both essentially created a niche (below and in addition to the traditional legacy market), and occupy a large share of it. Some of their customer base came from legacies, some was new. Details are different.
Those three are established now and occupy a large share of their niche, taken together they are *roughly* analogous to SWA in the US. That creates an ecosystem in which it's going to be hard for new ones to grow and thrive.
The US is similar with SWA... not a ULCC but it DOES occupy so much of the "cheaper than legacy" market that it serves as a spoiler for the massive growth of ULCC here.
Different evolutionary path here vs. Europe. I don't think there are three large, distinct markets: Legacy, LCC, and ULCC. I think that spectrum can be covered by two large business models which establish economy of scale, with a few small niche players filling in the gaps. I don't think there's room for a vast ULCC market here with SWA in the way. Unless they can steal pax from SWA. Probably some room for point-to-point growth, to work around the legacy hub-and-spoke system. But the legacy customer base is either locked into hub-and-spoke (small towns), set in their ways (older folks), need overseas access, or are just too high-dollar for ULCC (JB has tapped some of that with high-end service between elite destinations).
Southwest is not a ULCC so comparing them to Ryan Air and others is off base in my opinion.
Southwest includes more freebies in their base ticket than any of the legacies. Southwest is also more expensive than flying any of the big three here in the US most of the time. Ryan, Easy Jet and Wizz are basically the same business model as Spirit and Frontier. Spirit and Frontier just aren’t as big.
Stage lengths are key for ULCC’s. The shorter the better. People don’t care whether they’re going from DTW to LGA or EWR to LAX they want to pay $50. If they can squeeze 228 people into a 321 going from DTW to LGA and sell them drinks, seat upgrades and bags it’s more profitable than selling them the same bags and upgrades going coast to coast. The longer the flight the harder it gets to make any money or break even on just the base fare.
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