How Do European Budget Airlines Afford To Offer Such Low Fares?

If you’ve ever been traveling in Europe and gone to book a one-way ticket on a budget airline , you wouldn’t be the first to be amazed at the rock-bottom prices that some European budget carriers offer for passengers. Fancy flying between London and the South of France for less than the cost of lunch on the high street? Or how about departing from Madrid to Budapest for half the price of a night’s accommodation?

Ultra-low fares in Europe

Thanks to intense competition and an open skies policy in Europe, airlines such as Ryanair , WizzAir , and easyJet , Europe’s three leading budget carriers, make low fares across the continent and North Africa a reality. But this raises the question: How can airlines offer such cheap tickets for travel across Europe?

To begin with, it’s not just about the markets they serve but their unique business model. Ryanair, the largest and one of the most famous low-cost carriers in Europe, has used its ‘no frills’ approach to travel, and they are reaping the rewards because of it. They have been able to achieve this with three core focuses:

User experience

There will be no fine dining onboard, so don’t expect seat-back entertainment. The interior of a Ryanair aircraft is an awakening bright yellow and navy blue. With seats unable to recline (known as pre-reclined seats), the seats gradually become more raked than usual economy seats. They are lighter, cost less to build, and don’t require as much maintenance.

Other examples of a refined user experience are no onboard WiFi, additional costs for seat selection, priority boarding, or food and beverages onboard.

Minimal operational costs

If you have ever traveled on Ryanair, you would be familiar with long transit times from gate to plane, even by bus, and boarding the aircraft by stairs. Using as few airport facilities as possible means the airline can pay minimal airport fees. This is also witnessed within the terminal by having passengers print their boarding passes at home or use the app on their phone to check in, meaning less staff is required at the airport.

An extensive network

Over the decades, Ryanair has built an extensive network across Europe and Northern Africa. By operating a robust network of flights, the airline has dominated market share across the continent.

Photo: Patryk Kosmider | Shutterstock

Its success is based on its quick turnaround. The airline aims to have arriving passengers disembark, reload the plane, and be back in the air within 25 minutes. This quick turnaround will allow the airline to operate more flights daily, maximizing its potential revenue.

In addition to building a trans-European network, low-cost carriers tend to avoid conventional airports. An example of this is in London, where easyJet, Ryanair, and Wizz Air have avoided London Heathrow. This is due to the cost of airport fees. Many of Europe’s largest airports have high usage fees, translating into higher ticket prices. Instead, the airlines look at unconventional airports, like Frankfurt Hahn or Stockholm Skavsta, where they can use bargaining tactics to demand runway slots at lower costs.

Point-to-point networks

Legacy carriers, like British Airways , Lufthansa, and Iberia for example, have built their network on the ‘hub and spoke’ model, where these carriers will offer direct flights from their home airport to several destinations. However, for example, if a passenger is looking to fly from Berlin to Malaga on British Airways, they will be required to transit via London Heathrow Airport , adding additional costs to the ticket price.

Source: Ryanair

In comparison, European ultra-low-cost carriers tend to build their model on a point-to-point service, offering a range of routes in varying markets across the continent. This can be seen with Ryanair, which, instead of having one main operating base, has almost 100. This, in return, relates to operating 250 airports and providing up to 3,600 daily flights.

Additional benefits of a point-to-point network

Not only does providing a point-to-point network make it easier for travelers to fly non-stop to their intended destination, but this also comes with a range of benefits for the airline themselves; these include, but are not limited to:

• Minimizes risk of delays
• No co-ordination required for passengers on connecting flights
• Create new routes that haven’t been operated before
• Generate demand on underserved city pairs

Photo: jamesdc152 | Shutterstock

With many creative approaches to air travel, budget airlines in Europe have become the king of increased efficiency in the aviation industry. Ensuring that they focus on reduced operating costs and offering the bare minimum for paying passengers has, in return, resulted in the lowest airfare possible for the consumer.

A unique business model operating on both sides of the Atlantic

This business model, which can also be seen in other markets such as the United States with Frontier Airlines , Southwest Airlines , and Spirit Airlines , has meant that millions of people can now look to travel where they may not have been able to afford it before. This fundamental change in how we travel has reduced the complexity of both leisure and business travel and has made travel more affordable without necessarily stripping all the convenience.

Budget airlines provide a wide range of ultra-low fares for the consumer and provide a lifeline to some small towns and cities across the continent. Ryanair and WizzAir have been able to spring into action when European legacy carriers may fail. An example of this was the demise of Malév Hungarian Airlines.

When the Hungarian carrier ceased operations, Ryanair and Wizz were able to respond quickly with added routes and capacity to and from the Hungarian capital.

Source: Simple Flying