Tag: low cost carriers

29
Mar

Why IT innovation is necessary for low cost airlines

On March 16, 1967 two men, an entrepreneur name Rollin King and a lawyer named Herb Kelleher started a tiny airline that would only fly within Texas using three 737s. Not flying out of Texas was a key strategy to avoid price controls and market regulations which applied to most other carriers and thereby allowed them to undercut their competitors. However their business model stretched far beyond routes. From inception, their strategy was to cut costs and increase efficiencies in any way possible. This allowed lower fares to be passed onto consumers. As it was decades before the possibility of IT innovation, this was the way of the ‘low cost’ airline revolution.

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