This study aims to provide a better understanding of Asia's low-cost carriers (LCCs) by empirically analysing their route entry patterns in Hong Kong. Two alternative models have been tested, namely a standard probit model and a generalized least squares estimation. Consistent findings from the two models suggest that LCCs in Asia have a preference for large markets with big populations, high incomes and high traffic volume. On the other hand, the dominance of incumbent full service airlines (FSAs), fierce route competition and the lack of secondary airports are not critical to the growth of LCCs. However, government regulations and airport access are main impediment factors. Despite the adoption of long-distance low-cost models by the region's airlines, geographic distance still plays an important role in LCCs' entry decisions. For the growth of low-cost travel and associated benefits in the tourism industry and overall economy, it is important for governments in the region to liberalize aviation markets, provide sufficient airport capacity, and promote efficient allocation of airport slots.
|Number of pages
|Journal of Air Transport Management
|Early online date
|13 Aug 2016
|Published - Sept 2017
|International Forum on Shipping, Ports and Airports 2015 - , Hong Kong
Duration: 29 Nov 2015 → 2 Dec 2015
Bibliographical noteSelected paper from "International Forum on Shipping, Ports and Airports 2015" (IFSPA), held in Hong Kong, 29 Nov to 2 Dec 2015.
- Hong Kong
- Low-cost carriers
- Route entry
- Traffic volume changes