Connecting flights hold the key to low-cost long-haul success

By The Economist online

IT IS a peculiarity of the airline business that a connecting flight is often cheaper than a shorter nonstop route to the same destination. Normally, paying less to receive more is economically preposterous. But in transportation, where the fastest conveyance from A to B is the main utility, it makes perfect sense. For passengers, sitting on a plane any longer than necessary can be an exasperating, even painful experience. For airlines, flying empty seats is no less harmful. This inverse relationship between a journey’s value and its cost is something that Europe’s new breed of long-haul budget carriers may be overlooking.

As Gulliver reported in March, International Airlines Group (IAG), the holding company of several airlines including British Airways, is the latest pretender in the low-cost long-haul market. Its new venture, Level, has begun offering rock-bottom airfares from Barcelona to the West Coast of America, the Dominican Republic and Argentina. Routes from other European cities are expected shortly. In Germany, Lufthansa already deploys its low-cost carrier, Eurowings to the Americas, Thailand and Mauritius. Air…

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Category: Business and finance, Gulliver

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