Key Factors for Future Competitive Success

1. Key Factors for Future
Competitive Success
Like every other wide-serving industry, aviation must adapt its conventional business
model to meet changing consumer demands. Strategically diversifying the traditional
business model will allow airlines to satisfy passengers, capitalize on international
trade and serve potential niche markets that are currently underserved.
As air transportation becomes increasingly accessible to more people with rising
incomes, airline companies are looking to serve specific niche markets with revised
revenue models. Here are some of the key areas the aviation industry’s competition is
shifting toward in the future of aviation business:
 Low-Cost Carriers: Low-cost carriers (LCC) are hardly a new concept in the aviation
world, as no-frills, discount air travel has been available for decades. However,
what’s predicted to expand is the sheer volume of low-cost airline companies
available to consumers, as well as the selection of routes. LCCs used to be solely
reserved for short-distance flights, but industry business experts predict that long-
haul LCC options will increase thanks to the development of more LCC hubs around
the world.

2. Premium Economy: Consumers are increasingly seeking a middle-ground
option between luxurious-yet-expensive business class and affordable-but-
cramped economy seating. Many airlines are now offering Premium
Economy seating options, which give passengers additional legroom and
some extra perks for an additional fee. The limited availability of Premium
Economy seating on airlines drives demand within a specific consumer
segment looking to increase their comfort while still keeping within their
budget. This future aviation trend will likely expand further, particularly
within long-haul and transcontinental routes.
Air Cargo: Global trade is driving the increase in air cargo demand —
primarily in the Asia-Pacific region. That’s because household incomes and
population in the area are rising as are the region’s manufacturing and
distribution sectors. However, increased geopolitical friction and the
restriction of trade between countries could impede growth in air cargo
despite it being economically poised for expansion. As long as governments
maintain cooperative infrastructure between countries, air cargo could be
a major economic aviation trend.