Legacy airlines in upheaval: Keep or ditch the economy class?

AirAsia in Thailand

Conventional wisdom says that the LCC (Low Cost Carrier) model only works for short-haul flights and cannot compete with the legacy carriers for the long-haul business. But most legacy carriers know full well that it is only a matter of time until they are challenged by the LCC on the long-haul. Already AirAsia X and Norwegian are demonstrating that conventional wisdom is wrong and that the LCC model is not limited to the short-haul business. Lufthansa is toying with the idea of creating a long-haul LCC to South-East Asia and India in addition to its regional Eurowings and its low-cost Germanwings. With Norwegian now offering low-cost service to Bangkok from northern Europe, it is obvious that Lufthansa would stand to lose some of their economy business to Norwegian.

The metamorphosis of travel and tourism

How much mass tourism can squeeze on an island?

In the short span of a generation, travel and tourism has gone through a sweeping evolution with everything becoming easier, faster with fewer intermediaries. Wheels on our baggage, paperless travel, booking a room on your smartphone while walking in the lobby of that hotel, bringing your own lunch aboard, etc. a multitude of seemingly small changes that together have created a new dynamic causing a metamorphosis in the industry.

The flow of tourism no longer originates exclusively from developed countries as emerging countries, historically only exotic destinations, became significant generating markets in the last decade. The emergence of low cost carriers and online travel services have sent traditional travel agents the way of video stores. Tourism is now a two-way street anyone can use, mostly, without the middleman. There is still good business to be had for the middleman with groups, MICE and highly specialized experiences, but in a different role of coordination rather than information and booking. Destinations and operators, once dependent upon travel agents in generating markets to bring them customers, are now reaching customers directly and taking bookings without intermediaries.