Need to find new ways of doing business
Airlines have to find ways to evolve and to do things differently, Alex Cruz, ceo of low cost Spanish carrier Vueling.
"We have to find ways of doing things that we have not done before but it also means controlling costs," he said.
Speaking at the World Low Cost Airlines Congress in Barcelona today (September 29), Mr Cruz said his airline was spending energy looking for the new "Holy Grail" which would increase revenue but not add costs.
He was speaking in a debate on the low cost model versus the legacy versus the hybrid model.
He said Vueling had been accused of "deserting" the low cost model by putting its inventory on GDSs but he said the industry could not manage on a single model.
Vueling has reached out for the business traveller so corporate travel managers would use the airline.
"There are a number of things these travellers want besides a punctual service, like loyalty schemes, lounges and specialised services.
"But generally we are quite shy about getting involved in these things because they drive costs," he said.
"But we live in a different world to the one of 10 to 15 years ago and I don't believe these amenities are now worth it for short haul.
"We will continue to introduce new things but that will be where we are adding value but not adding cost."
Mike Rutter, chief commercial officer for the UK airline Flybe, said there was no low cost carrier rule book - "never has been one and never will be one."
He said Flybe, the UK's largest domestic airline, was a hybrid between the legacy and low cost carriers (LCCs).
He said Flybe's product and distribution methods were from its legacy background while its cost focus and ancillary services were from LCCs.
Jorge Vilches, ceo of LAN Peru, said airlines had to adapt to their market.
"South America is very different in terms of costs from Europe or North America," he said.
He said his airline operated the low cost model for short haul and the legacy model for long haul.
"The secret is to give each passenger what he wants in terms of what sector he is flying. If it is a three hour flight, they do not want a lie flat bed.
"But we do need the GDSs as we want people from England, Spain and New York to get onto our domestic operation. So our network is key," he said.
Walter Prenzler, ceo of Nas Air, a Saudi Arabian LCC, said that legacy carriers had to move "more strongly into the markets of the low cost carriers".
He added: "They are under immense pressure from some customers. They are losing their traditional business clientele as these passengers are becoming more price sensitive.
"But it all depends in the end on the passenger and the culture.
"I think they will integrate more with each other," he said.
www.flybe.com [1] www.vueling.com [2] www.flynas.com [3] www.lan.com/peru [4]