I just got a news report that Aer Lingus (EI) plans to leave the oneworld alliance. I found the press release on the oneworld website. It looks like its true! Now, the departure of EI will have next to no effect on oneworld, but I wonder will SkyTeam pick this carrier up? I recall when CO and EI had a partnership: at least I recall getting OP miles on Aer Lingus some time ago. I'd love to see CO and EI back in a business relationship again.

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I hope that ST picks up EI. I know that the product has degraded; the airline is in a tough battle with Ryanair. The company recently got new management, so perhaps they made this move. The carrier also seems to be transforming itself into a long-haul provider: at least it is adding lots of long-haul capabilities to the fleet.

Willie Walsh, now of BA, has put EI on a good course. The Irish government is planning to float the company--I read this report some time ago. I think it would mesh quite nicely with ST--or SA for that matter. It won't have a huge impact on any program, but I'd enjoy the LAX/DUB flight with connections to the rest of Europe.

From the press release:

"It has confirmed that it has no intention of joining another global alliance and that its key bilateral relationships will remain with oneworld members."

Too bad, since the start of the flights to DXB, EI was starting to become an interesting choice for oneworld RTWs again.

I read it and I don't believe it. It sounds like the little girl wants to be courted! There's really no way that EI could stay outside an alliance if it wants to remain a full service carrier; however, if the carrier wants to morph into an LCC, that's a different story! We'll know more this fall.

Hey, OT I know, but are you updating these miles each time you fly?

Apparently that is exactly what they are trying to do. here's another quote for you:

"The alliance's key target market is the multi-sector, premium, frequent international traveller, while Aer Lingus has repositioned itself as a low fares point-to-point carrier."

(Bold is mine)

Exactly. When my parents flew EI AMS-DUB on a KLM codeshare (they want CO EQM IAH-AMS, so they fly KL), even non-alcoholic drinks were not free. 1 euro for a cup of coffee. That's exactly the opposite position taken by CO in the US.

I have been reading various commentaries on the strategic direction of EI, particularly under the leadership of Willie Walsh. What they're doing doesn't make sense. They've always discussed following the LCC model, but the carrier hasn't bitten the bullet on that one. For example, the carrier offers business fairs. The prices are competitive, about $3k from the east coast, but I think if you want to call yourself a true LCC, get rid of the front cabin.

I think that the carrier must be thinking about who it is and where it belongs in the world. My gut tells me that EI will move in the direction of a long-haul, two-tier service carrier. It may be price competitive in coach, but it will continue to offer full service up front. I also expect it to join another alliance; I would love that alliance to be ST!

How does having a first/business cabin define an airline as being a true LCC?

LCC = Low Cost Carrier where "Cost" denotes operating expenses not ticket prices.

WN, F9, B6, FL, etc. are LCC's due to the nature of their cost structures and not ticket prices.

Having a first/business cabin does not define an airline as being a true LCC; I didn't say that.

First off, the LCC moniker is derived from the marketing strategy of the carrier.

There are fundamentally two marketing strategies in business: price or differentiation. LCC's are focused on price. The way that they can focus on price is to be a low cost provider. No company that wants a price strategy can avoid focusing on its cost. Legacies, for the most part, claim that they focus on differentiation--at least you hear all kinds of statements about business travelers, etc.; however, they end up contaminating their message by communicating low fares. If a carrier truly wants to focus on price, it shouldn't have a mixed message. It's not surprising that companies with a focused marketing strategy seem to remain profitable (in both the US and Europe--Asian companies are relatively new) If a carrier decides that it wants to differentiate itself (service usually), it incurs costs in this effort. Marketing to business travelers is very different than targeting Joe Six-pack. The company incurs other operating costs in the effort. Targeting the front end of the demand curve can be very profitable. EI markets to both budget conscious consumers and business travelers. LUV does that two, but LUV doesn't incur the costs of having two classes of service. I don't believe that EI can thrive with a mixed message. There are many choices of flights into and out of Ireland. If it's not part of an alliance, I believe the company will find it challenging to retain its high margin customers. The airline must either join another alliance or maintain reciprocity with a few select carriers to give customers more choices about where they can fly.

MaxJet is an LCC with all J service. YX is sort of an LCC with hybrid F/Y service (F comfort, Y meals).

It's not clear yet if MaxJet or EOS are low cost carriers; they've yet to provide financials.

Pimaris is another airline that is supposed to appear later this year at LAX. Those carriers aren't targeting the masses--they're not a Wal-Mart compared to a Nordstrom's if you will. I've seen these all-business concepts in the past and none has survived. Anyone recall UltrAir from IAH to EWR in the early 90's? Midwest is an interesting animal; they seem to be doing all right. The cabin isn't configured like MaxJet, EOS, like UltrAir was or as Primaris claims it will be. As you point out it's an J/Y hybrid.

The term LCC is bandied around a lot. When it's defined, it's invariably discussed in terms of the market strategy adopted by the carrier--which makes sense. Focusing on the marketing strategy makes sense, and then review how the airline configures its operations to achieve its goals.

If the term "LCC" commonly is defined relative to marketing strategies, and that interpretation makes sense, then MaxJet and EOS definitely would be considered LCCs, as they offer a J product for the price of Y to value minded business travelers. Same could be said for YX.