Major, Minor, Low-Fare, High-Fare – What Exactly Is the Difference Between Airlines?
By Amy Ziff, Editor-at-Large
March 17, 2004
I can imagine one day a child of mine asking, "Mommy, what's the difference between a low fare carrier and a major airline?" I'll scratch my head and think, to myself, “you know, this used to be a simple question”. Not anymore. If forced to answer today, I'd have to say, "There's a storm brewing…"
Once upon a time, there were six major airlines: American, Continental, Delta, Northwest, USAirways, and United. They were sometimes referred to as the “big six,” and they ruled the skies. Customers chose them because they provided a big network, a premium product, reliable service and robust schedules. Back in the day, there were only a handful of small, lower-fare carriers, but they offered very limited schedules and were known more for their gimmicks such as snazzy outfits or off-beat snacks. Sometimes they worked, others they didn't. But for a long time, nobody thought all that much about them.
Southwest Airlines launched in 1971 and grew slow and steady. 1980 marked the beginning of Spirit. There was ValuJet in 1993, now part of Air Tran Airways, among others. Slowly but surely, this new breed of upstart grew – both in size and in confidence. And by 2000, when Jetblue took off, air travelers found the skies loaded with options. Some of the low-cost carriers focused on out-of-the-way airports like Oakland, Love Field, and Chicago Midway, while others went head to head with the big guys in places like Denver, Atlanta, and New York. Today the new guard is duking it out with the old guard from coast to coast, literally. Many low-fare carriers now serve transcontinental flights, and just last week, Jetblue -- the hometown airline of the world's largest travel market -- announced bold plans to become international, with flights to the Dominican Republic.
If you're wondering what all this means to you -- aside from better pricing where there is a low-fare carrier present – the answer is it depends. If you’re a price sensitive, occasional flyer, the bare-knuckled competition between carriers is great news. You may also see improved options for food, though you'll probably have to buy it, and more in-flight entertainment options. Where as loyal customers to a major carrier are more apt to be those with frequent flyer status still lured by the network breadth and elite status programs. No doubt the majors are going to try to do whatever it takes to keep loyal travelers, including giving more access to those pricey seats coveted at the front of the plane. But you can't help but wonder for how much longer the majors can afford to lose money to keep you in their seats.
For now, one one thing remains clear: the airline underdogs are doing something right. Very right. So look for the majors to emulate these onetime minor players in the months to come. As a matter of fact, one look at fares in the markets with heavy low fare competition indicates just how determined the big airlines are to win. For example where there is a Jetblue fare (14 days in advance) from New York to Long Beach for $278, there is a matching fare on American. From San Fran to Phoenix there is a $138 fare on Ted and USAir has a matching fare too. What may turn out to be terrible news for the old guard promises to yield continually better pricing for customers, at least in the short-run.
We are still in the early rounds of what promises to be a long, drawn out fight between the bigger, older airlines and the young whippersnappers. While the ultimate outcome is anybody’s guess, it sure is interesting to witness. The dust on the tarmac hasn't even begun to settle on this issue, in fact, from where I fly it looks like the dust storm has only just begun.
If you have a question or topic you would like me to cover in a future column, please e-mail Amy Ziff at askamy@travelocity.com And remember to look here for your topic each week!
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