Monday, March 25, 2013

Low Cost Airlines Fueling The Latest Civil Aviation Boom?

With Ryanair and Lion Air ordering billions of dollars worth of new planes, is the budget airline sector fueling the latest civil aviation boom? 

By: Ringo Bones 

Ryanair CEO Michael O’Leary might have picked the very right time to order 15.6 billion US dollars worth of the new Boeing 737 Max aircraft. After all, with Boeing’s on-going problems with the lithium ion batteries of the auxiliary power unit of their fleet of 787 Dreamliners already in service around the world, the Ryanair CEO could easily negotiate Boeing to buy a new fleet of 737 Max at a very keen price. 

On the East Asian low cost airline scene, Indonesia’s Lion Air  - currently Indonesia’s largest privately run airline company - decides to buy 24 billion US dollars worth of new fleet of aircraft from Airbus back in March 19, 2013 given that budget air travel is the only economically viable business move in the region at the moment. But can the budget airline sector manage to revitalize the currently struggling civil aviation market? 

Even though well-healed tourists had always associated budget airlines with shoddy sub-par service, overseas contract workers – especially from the economically depressed parts of the East Asian region – had been embracing low-cost carriers since the late 1990s as their commute of choice on their way to work in the more affluent parts of the Persian Gulf to earn money for their families. And if the world’s major civil aviation firms manage to make keenly priced intermediate range passenger planes favored by low cost airline operators, then maybe, low cost airlines could spearhead the global economic recovery all of us desperately needs. 

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