Strategies for airlines facing underperforming routes

Policy

Simple Flying | Simple Flying

By Sky Industry News

Dec 1, 2024

Airlines often face challenges when new routes do not perform as expected. Despite careful planning, some routes may not succeed due to unpredictable market dynamics and consumer behavior. According to International Airport Review, around 50-70% of airline routes avoid cancellation within a few months or years of launch. This indicates that even under optimal conditions, one in three routes may fail.

Airlines can consider several strategies to address underperforming routes. Reducing capacity is one approach. By decreasing the number of daily flights or using smaller aircraft, airlines can maintain profitable load factors. For instance, if United Airlines observes lower-than-expected load factors on flights from Newark Liberty International Airport to Lisbon International Airport, they might switch from larger Boeing 767s to smaller 757s.

Adjusting flight schedules is another option. Airlines might change schedules to optimize connections, cater to business travelers, or operate during off-peak times when fees are lower. An example is Aerolíneas Argentinas adjusting its schedule for flights from Buenos Aires to New York's JFK Airport.

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Changing the arrival airport can also be effective. Budget airlines might move services from higher-cost airports like London Heathrow and JFK to less expensive ones such as Newark and Gatwick.

Increasing service offerings may seem counterintuitive but could help attract more passengers by providing additional flight times or enhancing onboard services like business and premium economy seats.

Finally, doubling down on demand stimulation tactics can boost route performance. Carriers such as Azul, Breeze Airways, and Ryanair engage in strategies like local advertising and targeted promotions to increase demand for specific destinations.