WOW Airlines is an Iceland-based company that is currently
from Baltimore and Boston to Reykjavik for as little as $400 round-trip. They
use the Airbus A320 for the five-to-six hour trip. They are using smaller jets
so they need fewer passengers to fill them, which in turn reduces their risk
for not filling the planes. And charging on $400 round-trip, it almost
guarantees you will get all the passengers you need.
La Compagnie is a French-based company that is currently
flying from New York City and Paris. They use a 74 seat, all business class
seating 757 and La Compagnie charges around $2,000 round-trip. They are trying
to do a low cost, point-to-point, long-haul market. La Compagnie promises
everything the legacy carriers do except a crowded airplane.
WOW Air is more for short to medium hauls as compared to La
Compagnie which is more of a long-haul carrier. La Compagnie uses Boeing 757
fitted with 74 business class seating and WOW uses Airbus A320. Both have the
same philosophy low cost airfares and try to limit the time of the airplane on
the ground. I think WOW Air will be more successful, because they are more
focused on the short to medium hauls instead of the long haul like La
Compagnie. Focusing on the short to medium haul in my opinion has more of a consumer
base than the long hauls. This in turn means if you have lower airfares and a
small plane then you never have to worry about having a flight with a bunch of
empty seats.
I think the overall global impact of these types of airlines
is good for the market. These companies are trying to use the same model as
Southwest Airlines used and it has been successful here so why can’t it work in
the international market. I think that these business models are going to make
the market more competitive, which is a good thing.
http://uk.reuters.com/article/2014/11/03/airlines-wow-air-ceo-idUKL6N0ST34K20141103
