Kostin K.B., Polyntsev P.S.Published in:
Russian Journal of Entrepreneurship
– Volume 19, Number 2 (February 2018)

JEL classification: L91, L93, M11, M16

Keywords: international airline, low-cost airlines, pricing, profitability management, revenue management


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Abstract:

We present a comparative analysis of European airline market. We reveal the differences in the functioning of traditional and low-cost airlines on the basis of the data on the activities of the European budget airline EasyJet and its competitors. We’ve found out that, all other things being equal, budget airlines tend first of all to maximize their aircraft load in order to maximize revenues. We also found out that in conditions of elastic demand, the maximization of the load becomes possible due to the application of revenue management methods and technologies that allow dynamically setting prices in accordance with market requirements. We analyze the principles of international airline pricing.

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